Germany wants IMF funding raised to US$1 trillion
BERLIN, Germany — GERMANY wants the International Monetary Fund’s (IMF’s) lending capacity to be brought to some US$1 trillion, meaning adding another US$400 billion to its coffers, a senior official in Berlin said yesterday.
The official, speaking on condition of anonymity in line with government policy, said bringing the IMF’s war chest to a “similar” level as the European financial firewall of euro800 billion (US$1.1 trillion) would send a strong signal to markets.
Financial officials from the Group of 20’s biggest economic powers are expected to discuss the issue at a meeting in Washington this weekend.
“We are very hopeful and have been working hard so that we can produce a number together in Washington like what we have already done and delivered in Europe,” the official said.
The IMF has already given out some US$250 billion in loans and has about US$385 billion on hand, meaning it would need about US$400 billion more to reach that figure.
Going in to the meetings, European countries have already pledged around US$200 billion more for the IMF, and Japan yesterday pledged US$60 billion.
Germany will also be pushing for stricter financial market regulations to help prevent another crisis, as well as structural reforms to promote growth — reminding others of the 2008 pledge by G-20 leaders in Toronto to reduce their deficits by half by 2013, the official said.
“Germany will make clear that we see possibilities through further structural reforms to boost economic growth,” the official said.