.gif)
A global financial industry group Monday called on the Group of 20 countries to act swiftly to boost International Monetary Fund resources to deal with a deteriorating world economy.
The Institute of International Finance (IIF) said the "immediate issue" amid the global financial and economic crisis was "how to quickly put into place the resources that have been committed by the G20 -- especially when legislative action at the national level is necessary to secure the funds."
The IIF call was made in a letter written to the head of the IMF's policy-steering committee, Youssef Boutros-Ghali.
The letter from IIF managing director Charles Dallara, less than two weeks before the IMF and World Bank meetings, emphasized that follow-through on pledges from G20 developed and developing countries at their London summit was critical to confronting the crisis.
"Time and leadership are of the essence. Only with funds in hand can the IMF provide timely and meaningful assistance to emerging economies that have been severely affected by a crisis originating elsewhere," the letter said.
Dallara at a news conference acknowledged the difficulty of mobilizing the resources pledged, which includes "up to" 100 billion dollars from the United States.
"The challenge now is to translate the broad commitments on policy and funding that were made at the G20 summit into a reality, and to do so with considerable urgency, because we all know that the backdrop remains one of a deteriorating world economy," Dallara said.
Although the pace of the deterioration of the world economy "may have eased somewhat," employment and production data in the US, Europe and Japan remained "quite weak," he said.
The IIF called for the IMF to improve its multilateral surveillance of the global financial system and launch a framework for regular and extensive interaction with private-sector market participants that would be fed back into economies, including China and India, he said.
Such a framework was "profoundly lacking over the past decade and it has cost us dearly," Dallara said.
"Nothing short of a transformation of the IMF is called for if these resources are to be effective," he said.
The IMF needs to take a more forceful approach to strengthen coordination of macroeconomic policies to reduce global imbalances, said the IIF, which represents more than 375 financial institutions in 70 countries.
"Towards this end, IMF management -- with the active support of enlightened shareholders -- needs to invigorate multilateral surveillance and consultations, including visible benchmarks for all key countries," Dallara wrote to Boutros-Ghali, chairman of the International Monetary and Financial Committee.
The IIF said its new Market Monitoring Group could be a key conduit between the private sector and the official sector. The group, launched Friday to detect "seeds" of crisis, is headed by Jacques de Larosiere, a former IMF managing director, and David Dodge, a former head of the Canadian central bank.
The IMF and World Bank hold their annual spring meetings on April 25-26 in Washington.
