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Emerging Nations Poised to Gain IMF Sway as U.S. Impasse Eases

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IMF

U.S. lawmakers are poised to give emerging economies more of a voice at the International Monetary Fund, ending a five-year impasse that fed criticism of the American-led global monetary order by China and other countries.

House and Senate negotiators on a $1.1 trillion spending plan included language implementing the IMF change, according to the text of the bill. That gives the IMF provision a strong chance of passing Congress later this week and being signed into law by President Barack Obama.

Passage would be a victory for the Obama administration and Treasury Secretary Jacob J. Lew, as they seek to maintain the strength of Washington-based international institutions like the IMF while China seeks alternatives such as the new Asian Infrastructure Investment Bank.

The IMF’s executive board approved a plan in 2010 to increase the voting share of emerging economies and double the amount of permanent funding available to the Washington-based fund. While supported by the Obama administration, the changes require ratification by Congress, and Republican opposition has prevented the IMF from implementing the changes.

Some Republican lawmakers had previously said the shift would give too much influence to countries that don’t share U.S. interests, while others questioned the need for international bailouts.

Emerging-market leaders had warned the IMF would lose legitimacy if its voting structure didn’t reflect the growing economic clout of countries such as India and China. The delay was cited as one of the reasons that China established the AIIB, a development lender similar to the World Bank.

Veto Power

The changes require approval by countries representing 85 percent of the board’s voting power, allowing the U.S., with its 16.7 percent voting share, to exercise its veto.
China, the world’s second-largest economy, currently ranks sixth in voting shares at the IMF, behind the U.S., Japan, Germany, France and the U.K. Under the 2010 plan, China would jump to third, while India would climb to eighth from 11th and Brazil would move up four spots to 10th.

The IMF was conceived during World War II to promote international monetary cooperation and exchange-rate stability. It has evolved into the world’s lender of last resort for countries facing capital crises.

The fund is primarily financed by shares, known as quotas, assigned to its 188 member countries. The 2010 proposal would increase the proportion held by emerging economies.
The plan would give emerging countries two more seats on the 24-member executive board, by removing two seats currently headed by representatives from advanced European nations. All executive directors would be elected by member countries.

The proposal also would double the number of total quotas, while rolling back by a corresponding amount a credit line funded by 38 governments and central banks. The credit line was increased during the global financial crisis to give the fund more power to help countries in crisis.

Bloomberg

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Government

Zabarmari Massacre: Buhari to Provide More Resources for the Nigerian Military

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President Muhammadu Buhari

President Muhammadu Buhari has promised to provide more resources to the military in the aftermath of the Zabarmari massacre.

On Saturday, Boko Haram killed 43 people with around 70 people still missing in Zabarmari, a village in Borno State.

Reacting to the massacre, Buhari, through his official Twitter handle @MBuhari said “Nothing is more important than ensuring the security of lives and property of Nigerians. Everything is secondary when security is at stake. I will ensure that more resources are made available to the military and other security agencies to prosecute the war against terrorism.

“As we mourn all the lives lost in Zabarmari, the Armed Forces have been given the marching order to take the fight to the insurgents, not on a one-off, but on a continuous basis, until we root out the terrorists.

“We will intensify our cooperation with neighbouring countries on bilateral and multilateral levels, to ensure that there is no hiding place for the terrorists.

“As I noted earlier, the massacre by Boko Haram in Zabarmari is nothing short of senseless, barbaric, gruesome and cowardly. It reinforces our resolve to root out all forms of insurgency and insecurity not just in Borno but everywhere across Nigeria.”

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Boko Haram Kills Rice Farmers in Borno State, Northeast Nigeria

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Rice farmers were killed on Saturday morning in the Northeast Nigeria by suspected Islamist militants, Boko Haram, according to a Reuters Report.

The report also noted that 30 of the people killed were beheaded while over a dozen others were still missing.

However, resident of the Zambarmari Village where the attacks took place said a total of 70 people were feared dead.

Another resident and Amnesty International were quoted as saying at least 10 women were among those missing.

In another statement by Edward Kallon, the United Nations’ humanitarian coordinator in Nigeria, it was armed men on motorcycles that led the brutal attack on civilians harvesting their fields.

Armed men on motorcycles led a brutal attack on civilian men and women who were harvesting their fields,” Edward Kallon stated.

“At least 110 civilians were ruthlessly killed and many others were wounded in this attack,” he added, noting that several women are believed to have been kidnapped.

“The incident is the most violent direct attack against innocent civilians this year. I call for the perpetrators of this heinous and senseless act to be brought to justice,” Kallon said.

On Sunday, Governor Babaganan Umara Zulum of Borno State, who was at the burial told journalists that at least 70 farmers were killed on Saturday.

The Governor, therefore, called on the Federal Government to recruit more Civilian Joint Task Force members, Soldiers and civil defence fighters to protect farmers in the region.

He added that people are facing desperate choices.

In one side, they stay at home they may be killed by hunger and starvation, on the other, they go out to their farmlands and risk getting killed by the insurgents,” he said.

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In The Fight Against Corruption, No Individual is Bigger Than The State – Buhari

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Muhammadu Buhari

In response to the suspended acting EFCC Chairman, Ibrahim Magu, President Muhammed Buhari, lamented that the anti-corruption war becomes endangered “when persons entrusted with the responsibility of that magnitude become suspects themselves.”

Buhari, whose vision is to put an end to corruption in Nigeria, believed that every aspect of the nation’s life is enshrined in corruption and it’s of major concern when leaders of institutions saddled with the mandate to fight the menace are found in the waves of the corruption they claimed to be fighting.

This act is a great abomination not only because it strikes at the root but it also trivialises and undermines the anti-corruption crusade itself, the President explained.

He further said that in a bid to put an end to this great abomination, he had set up Ayo Salami Panel to unravel the mystery behind the mystique of Magu’s alleged involvement in corruption that his administration is fighting.

Buhari said that his administration is ready and willing to go all out in the fight against corruption, and no one is too big nor above the law to become a victim of anti-graft’s sledgehammer.

The president said, “However, the stark reality of widespread corruption becomes poignant when allegations of corruption touch on the leadership of an institution set up by law to coordinate and enforce all economic and financial crimes.

“It is an abomination that strikes at the root and undermines the government’s anti-corruption programme.

“It was in response to the serious allegations against the Economic and Financial Crimes Commission that I set up a panel headed by the Honourable Justice Isa Ayo Salami, retired President of the Court of Appeal, via an Instrument dated 3rd July 2020 pursuant to the Tribunals of Inquiry Act (Cap T21, LFN, 2004).

“We recognise that there are more grounds to cover in the war against corruption, and we are prepared to go out to possess those lands by cutting off any stream that nourishes the seed of corruption and supports its growth.

“Let it be known that in the fight against corruption, no one is too big to tackle, as no individual is bigger than the Nigerian State!”

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