Landen eurozone oneens over zetel in IMF (en)
EUOBSERVER / BRUSSELS – Finance ministers from the 16-country eurozone remain divided on whether the currency area should hold a single seat at the International Monetary Fund i (IMF).
Luxembourg's prime minister, Jean-Claude Juncker i, who chairs the monthly eurogroup meetings due to his double-hatted role as the country's finance minister, said he supported the move towards one seat on the international financial institution.
European commissioner for economic and monetary affairs,Joaquin Almunia i, also said he was in favour of the move.
"The best way to have a clear and a strong defence of our common interests as an economic and monetary union at the IMF level is to have a single chair," Mr Almunia told journalists after the meeting on Monday (6 July).
"This is not the opinion of some of the members of the euro area," he added.
Earlier French finance minister Christine Lagarde said a single eurozone chair on the IMF was unrealistic, reports Dow Jones.
However, Mr Juncker said eurozone finance ministers were more receptive to a plan to cut the number of IMF seats from 24 to 20, but again no final agreement was reached. Europe currently controls eight of the IMF board's 24 seats.
Reform of the IMF to give developing nations such as China and India a stronger voice in the multilateral lender was one of the commitments emerging from the G20 leaders' meeting in London this April.
In March, G20 finance ministers agreed to bring the next IMF quota review forward to 2011 from its previously scheduled date of 2013.
Although the West is keen that countries with large foreign currency reserves such as China make greater donations to the IMF to help ensure global liquidity, it has so far appeared reluctant to give up power in the Bretton Woods' institution, formally set up in 1945.
The topic will also be debated by G8 leaders meeting in Italy this week and is expected to really get going this October as the spring 2011 deadline comes closer.
Exit strategies
Eurozone finance ministers also discussed the area's stimulus spending and the need for credible exit strategies on Monday.
However Mr Almunia said now is "not the moment to withdraw the stimulus" as economic growth is not expected to return to the eurozone before next year.
"We will co-ordinate the withdrawal when the moment defines this," he said.
The comments, mirrored by Mr Juncker, are in line with forecasts by the Organisation for Economic Co-operation and Development. The body cut its outlook for the 16-country region last month, even as it raised its outlook for the global economy as a whole.
However the debate over how quickly to reduce national budget deficits – a bi-product of the worst recession since World War II - is set to intensify after the summer recess.
Sweden, which took over the six-month rotating presidency of the EU on 1 July, is among countries keen to claw back the money quickly using tax hikes and spending cuts in order to boost investor confidence.
Other member states plan to adopt a slower timetable, with French President Nicolas Sarkozy recently announcing plans for a new government multi-billion euro loan.