Strauss-Kahn: Lidstaten zullen verminderde invloed bij IMF goedkeuren (en)
EU member states would be willing to accept a diminished share of voting rights within the International Monetary Fund, said Dominique Strauss-Kahn, the new French managing director of the global financial institution.
"The EU countries know that their share of the voting power will be reduced," Mr Strauss-Kahn told Dow Jones Newswires on Saturday (26 January).
He made the comments at the World Economic Forum (WEF) in Davos, Switzerland, the annual meeting of top business leaders, international political leaders and the occasional Hollywood or pop superstar.
In 2006, IMF member countries agreed to a two-year deadline by which the organisation's arcane voting system would be re-jigged to give greater influence to developing countries.
However, it was concern over the rapidly worsening global financial situation that dominated discussions at the WEF over the weekend, with the IMF chief surprising commentators with his support for a Keynesian response to a global economic slowdown.
Mr Strauss-Kahn, a former candidate for the presidential nomination of the French Socialist Party, but also a character firmly on the right of the centre-left political grouping, said that the cutting of interest rates should be accompanied by a loosening of fiscal policy in those countries that could afford it.
While the IMF has a history of prescribing still further fiscal discipline as a cure for ailing economies, the organisation's new director said the current credit crunch was so acute that lowering interest rates was not sufficient, endorsing the Bush administration's proposed fiscal stimulus package.
"I don't think we would get rid of the crisis with just monetary tools," he said, according to the Financial Times.
Larry Summers, former US treasury secretary, also speaking at the Forum, noted that this was the first time in 25 years that the IMF had embraced a classical Keynesian solution to an economic crisis.
Elsewhere at the WEF, European trade commissioner Peter Mandelson said that the EU is to accelerate talks with Russia in an attempt to ensure the country's accession to the World Trade Organisation.
Mr Mandelson made the comments after meeting his Russian counterpart, Alexei Kudrin, in Davos.
However, at a dinner in the Swiss resort town, Lithuanian President Valdas Adamkus called on the EU not to rush into any new agreement with Russia.
Trade ministers from 20 countries also met informally on the sidelines of the WEF to attempt to achieve some movement on the long-stalled Doha round of trade negotiations.
Swiss economy minister Doris Leuthard announced that the trade ministers "will probably have a ministerial meeting in April" in Geneva on the subject, according to AFP.