Global economy can be more resilient with stable financial architecture: BRIC leaders

BRASILIA - The global economy can be more resilient with the help of a stable financial architecture, said leaders of Brazil, Russia, India and China (BRIC) at the end of their deliberations here on Thursday.

In a joint statement issued after their interaction, the BRIC leader said: “We believe that the world needs today a reformed and more stable financial architecture that will make the global economy less prone and more resilient to future crises, and that there is a greater need for a more stable, predictable and diversified international monetary system.”

“We support the increase of capital, under the principle of fair burden-sharing, of the International Bank for Reconstruction and Development and of the International Finance Corporation, in addition to more robust, flexible and agile client-driven support for developing economies from multilateral development banks,” they added.

They also said that they would strive to “achieve an ambitious conclusion to the ongoing and long overdue reforms of the Bretton Woods institutions.”

“The IMF and the World Bank urgently need to address their legitimacy deficits. Reforming these institutions’ governance structures requires first and foremost a substantial shift in voting power in favor of emerging market economies and developing countries to bring their participation in decision making in line with their relative weight in the world economy,” they added.

“We call for the voting power reform of the World Bank to be fulfilled in the upcoming Spring Meetings, and expect the quota reform of the IMF to be concluded by the G-20 Summit in November this year. We do also agree on the need for an open and merit based selection method, irrespective of nationality, for the heading positions of the IMF and the World Bank,” they said.

They said there is a special need to increase participation of developing countries.

“The international community must deliver a result worthy of the expectations we all share for these institutions within the agreed timeframe or run the risk of seeing them fade into obsolescence,” the BRIC joint statement quoted the leaders, as saying.

They said that in the interest of promoting international economic stability, they had asked their Finance Ministers and Central Bank Governors to look into regional monetary arrangements and discuss modalities of cooperation between our countries in this area.

On the issue of promoting international trade, the BRIC leaders laid stress on the importance of the multilateral trading system, embodied in the World Trade Organization, and called for an open, stable, equitable and non discriminatory environment for international trade.

“We reiterate the importance of the UN Millennium Declaration and the need to achieve the Millennium Development Goals (MDGs),” the BRIC leaders said. By Ravinder Singh Robin (ANI)