September 1998

A breathing space for the IMF: A new way to fund the IMF


Eugene Black argues the case for an alternative method of funding the IMF that would enable it to tap the private markets and reduce the need to return to member states for additional funds.


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It is astonishing that there has been no public discussion, or debate in congress, about the IMF's utilizing the private market for the bulk of its funding. This article suggests that it can be done with a minimum of effort and in a manner that does not require the IMF to return to congress and member nations' legislatures periodically for replenishment.

Before examining the best method of using the private capital markets to supplement the IMF's resources, it is well to consider present funding procedures and certain problems in the IMF's articles of agreement. The IMF's present sources are:

Member states' contribution of quotas relative to their size and wealth. These quotas are periodically increased but this requires legislative approval from each state,...


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