G-20 to Agree to Boost IMF Resources, European Official Says

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http://www.bloomberg.com/apps/news?pid=20601087&sid=ay.xSfxD4VHc&refer=home

G-20 to Agree to Boost IMF Resources, European Official Says

By Mark Deen and Christopher Swann


March 14 (Bloomberg) -- Group of 20 finance ministers will today endorse boosting the resources of the International Monetary Fund as the economic crisis forces more countries to seek its support, according to a European official.

G-20 ministers meeting in southern England have yet to settle on how much they will increase the Washington-based fund’s firepower, the official told reporters near the town of Horsham on condition he not be named.

IMF Managing Director Dominique Strauss-Kahn has lobbied for the fund’s cashpile to be at least doubled to $500 billion. It needs the money after being inundated with loan requests from Pakistan to Hungary as the global economy fell into recession.

The U.S. Treasury has also sought an expansion of the IMF’s supplementary borrowing program by up to $500 billion. The fund is currently able to borrow about $50 billion -- from 26 mostly wealthy member countries -- through these special financing arrangements. If that proposal won international support the fund could have the ability to lend $750 billion and possibly more.

In the past six months, the IMF has approved $16.4 billion for Ukraine, $15.7 billion for Hungary, $10.4 billion for Latvia, $2.5 billion for Belarus, $2.1 billion for Iceland, $7.6 billion for Pakistan and $516 million for Serbia -- a total of about $55 billion. Turkey is negotiating an IMF loan accord, and Romania has expressed an interest in borrowing.