IMF Executive Board Approves a Proposal to Increase IMF Quotas
IMF News, November 7, 2023
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- Published: November 7, 2023
Executive decision and purpose
- The Executive Board approved a proposal to be considered by the Board of Governors to conclude the 16th General Review of Quotas (16th Review) with a significant increase in quotas.
- The proposal is centered around an increase in quotas of 50 percent, allocated to members in proportion to their current quotas.
- Rationale:
- Help preserve a strong, quota-based and adequately resourced IMF at the center of the Global Financial Safety Net.
- Safeguard global financial stability and respond to members’ potential needs in an uncertain and shock-prone world.
- Enhance the IMF’s permanent resources and reduce reliance on borrowed resources.
Resource implications and lending capacity
- Once quota increases are in effect:
- Borrowed resources comprising the Bilateral Borrowing Agreements and New Arrangements to Borrow (NAB) would be reduced to maintain the Fund’s current lending capacity.
- The quota increase would strengthen the quota-based nature of the Fund by reducing the reliance on borrowing and ensuring the primary role of quotas in Fund resources.
Quota realignment and follow-up work
- Membership acknowledged urgency and importance of quota share realignment to better reflect members’ relative positions in the world economy while protecting the quota shares of the poorest members.
- The proposal includes a call for the Executive Board to work to develop, by June 2025, possible approaches as a guide for further quota realignment, including through a new quota formula, under the 17th General Review of Quotas.
- Work to implement this guidance will begin as soon as feasible after the conclusion of the 16th Review.
Governance and approval timeline
- The Executive Board has requested that the Board of Governors vote on this proposal by December 15, 2023.
- Approval by the Board of Governors requires an 85 percent majority of the total voting power.
Key quotations from IMF Managing Director Kristalina Georgieva
- “Concluding the 16th Review with a quota increase will help preserve a strong, quota-based and adequately resourced IMF at the center of the Global Financial Safety Net. An adequately resourced IMF is essential to safeguard global financial stability and respond to members’ potential needs in an uncertain and shock-prone world.”
- “The proposed quota increase comes at a complex time for the global economy and the IMF’s membership. In the spirit of international cooperation, I am hopeful this proposal will garner the broadest possible support from the membership, and that we will then make progress on a quota realignment under the 17th Review.”
- “As the world grapples with rising fragmentation, today’s decision is a strong signal that the membership can still come together in support of cooperative solutions that instill confidence in the IMF’s ability to effectively support its membership navigate a challenging global landscape.”
Press Release No. 23/383 — IMF Executive Board Approves a Proposal to Increase IMF Quotas (November 7, 2023).
