FOR IMMEDIATE RELEASE
Tuesday, March 26, 2014
US Congress Fails to Pass IMF Reform, Again
Major Blow for Global Economic Governance and Credibility of US Leadership
Washington, DC – Yesterday, Senate Majority Leader Harry Reid (D-Nev.) announced that the US Senate will remove the IMF reform legislation from its Ukraine assistance bill. This is a major setback for global economic governance and the credibility of US leadership. In 2010, the United States – in cooperation with emerging economies –spearheaded the IMF reforms. Since then, every country has ratified the reforms except for the US, whose approval is required in order for the reforms to become effective. Congress has had several opportunities to approve the IMF reforms, including January of this year.
“We are astonished that Congress failed, again, to pass the 2010 IMF reforms. This not only undermines the credibility of the US as a trusted leader and partner, it fragments global economic governance. US inaction weakens the prospects for international cooperation, especially with emerging powers. While these reforms are not perfect, they are a step toward bringing emerging powers to the table, instead of isolating and pushing them away” said Jo Marie Griesgraber, Executive Director of New Rules for Global Finance.
There was disagreement in Congress about the relevance of the IMF reforms to providing financial assistance to Ukraine, as well as misunderstanding of the IMF and the changes that the 2010 reforms would impose. The IMF reforms –which would provide a modest increase in voting power to emerging economies and reduce overrepresentation of European countries – would not require any new financial commitments from the US.
“This was a win-win for members of Congress who would like to strengthen US global leadership, specifically its position on Ukraine vis-à-vis Russia, without additional costs to US taxpayers” stated Ms. Griesgraber. “It is disheartening that political brinkmanship has spoiled another opportunity to approve the 2010 IMF reforms.
We stand with former Cabinet members and government officials from both parties, as well as policy experts and civil society, who agree that the US Congress cannot wait any longer to approve the 2010 IMF reforms.”
New Rules for Global Finance is a 501(3)c non-profit organization that promotes reforms in the rules and institutions that govern international finance; in order to support just, inclusive and sustainable economic development.
For more information, please visit www.new-rules.org.