The writer is resident fellow at the Mossavar-Rahmani Center for business and government in the Harvard Kennedy School and former assistant secretary for international affairs at the US TreasuryMembers of the IMF are gathering in Marrakech, Morocco, for their annual meeting this week. High on their agenda is the 16th review of IMF quotas, commitments by members to provide funds to the multilateral institution to be lent to other members.
IMF members have not changed the total size and distribution of quotas since 2010. Another failure to reach agreement on doing this would further imperil the status of the IMF as the central institution of the international monetary system. A perpetuation of the status quo would weaken its credibility and capacity to serve as lender of last resort and global standard-setter.
Members gather at IMF meetings and ritually declare that the lender should be a quota-based institution. But the truth today is that less than 50 per cent of resources available for the IMF to lend come from quota subscriptions. An agreement in Marrakech to change quotas requires a compromise on three issues that have led to a stalemate on negotiations for more than a decade.