IMF directors have agreed to overhaul the institution to give more influence to developing countries including China, reflecting the shifting balance of power in the global economy.
Under the plan, China, South Korea, Turkey and Mexico will see immediate increases in their voting rights as part of a broader two-year program of reform, IMF managing director Rodrigo Rato said.
"I think that all members recognize that relevant quotas and voting shares do not adequately respond to the reality of the world economy," Rato told Asia-based reporters in an online briefing from Washington late on Thursday.
The 184-member fund, which was set up at the end of World War II and lends money to countries in deep economic difficulties, remains dominated by the US, European countries and Japan.
Despite is growing stature as an economic powerhouse, China has less voting power than Belgium and the Netherlands combined.
Along with its sister institution the World Bank, the IMF has come under criticism in countries such as Argentina and in Southeast Asia and Africa for prescribing severe belt-tightening measures.
Rato said there was an agreement that a new formula for quotas should be based on the size of a country's economy and its openness but the exact parameters had not yet been decided.
The quotas determine how much a member contributes to the IMF, its voting rights and access to financing, which currently totals US$28 billion in loans outstanding to 74 countries.
At the same time Rato said it was important to protect the voice and representation of lower income countries through an increase in the number of basic votes a member is allocated regardless of their economic clout.
African countries are worried that with the focus on fast-growing economies they could miss out on a chance to get a greater say themselves at the IMF.
The plan, approved by the 24 IMF directors late on Thursday, will be submitted to the governors from each member country and is expected to be given final clearance at the fund's annual meeting on Sept. 19-20 in Singapore.
Some US critics oppose any increase of China's IMF influence unless the booming country takes rapid steps to revalue its currency, whose relatively cheap value has encouraged an explosion in Chinese exports.
The US government sees reform of the IMF as central to its goal of redressing global economic imbalances, which have frequently been cited by Rato as one of the biggest menaces to world growth.
"The United States has expressed clearly that they are backing the reform package," the IMF chief said.
Rato, a former Spanish economics minister, called on China to go further with currency liberalization but declined to link the issue to IMF reform.
"We believe it is in the interest of China to implement more forcefully the exchange rate regime it gave itself last year and to let market forces determine things in China in a more clear way," he said.
The fund is also looking to step up its financial surveillance role through multilateral consultations to make it more effective and tackle question marks about its continued relevance.
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