Greater Arab role needed at IMF, says UAE official

More Arabs are needed at the IMF to give it credibility with the region's member states, the UAE Minister of State for Financial Affairs says.

Arabs account for fewer than 3 per cent of employees at the IMF, said Obaid Humaid Al Tayer in a statement. Christopher Pike / The National

More Arabs are needed at the IMF to give the international lender credibility with member states from the region, the UAE Minister of State for Financial Affairs said yesterday.

Arabs account for fewer than 3 per cent of employees at the IMF, said Obaid Humaid Al Tayer in a statement issued on behalf of several countries during the IMF's spring meeting at the organisation's headquarters in Washington.

"We consider staff diversity as integral to the fund's credibility with members," Mr Al Tayer said in a statement posted on the IMF website. "The number of Arab economists at the fund has declined since 2009. Additional recruitment efforts are needed at all economist staff levels."

In the wide-ranging statement, Mr Al Tayer also said voting power at the IMF needed to be overhauled. To give all members an adequate voice and representation, he said changes were needed in the quota system, which determines how many votes each member has on the fund's executive board.

"The large weight of GDP in it undermines the voice and representation of most developing and emerging economies," said Mr Al Tayer. "A small open economy has clearly more at stake in the global financial system than a large economy with few external linkages."

Several emerging countries including Brazil, Russia, India, China and South Africa - the Brics - are campaigning for more say at the IMF as part of a push for broader reform of the global financial system to reflect emerging nations' growing clout.

The effort to secure more influence comes after a recent fund-raising drive by the IMF to help fight the euro-zone debt crisis. Christine Lagarde,the fund's managing director, on Friday said the lender had raised more than US$430 billion (Dh1.57 trillion) in extra capacity via pledges by Group of 20 economic powers. From the Middle East, Saudi Arabia is contributing an extra $15bn.

Ms Lagarde said the extra pledged funds had doubled the IMF's lending capacity.

"This signals the strong resolve of the international community to secure global financial stability and put the world economic recovery on a sounder footing," she said in a statement.

Mr Al Tayer said Arab countries supported the call for additional resources, saying they were important to address emerging risks to the global economy. But it was also important that the fund keep sufficient reserves, he said.

"Fund lending is at record levels and loans are highly concentrated," he said.

Mr Al Tayer's statement was issued on behalf of the UAE, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Libya, the Maldives, Oman, Qatar, Syria and Yemen.

The IMF's role in the region has come under greater scrutiny since the eruption of unrest in the Arab world at the end of 2010.

The organisation has drawn criticism from some observers as not focusing enough in the past on indicators of "inclusive growth" in its research in the region. Despite strong economic growth, unrest flared in Egypt, Tunisia and elsewhere, partly because of unhappiness among citizens over high unemployment and low living standards.

The IMF has also been in talks with Egypt's government about the possibility of a $3.2bn loan.

"The IMF has a potentially important role in promoting the adjustment and reform efforts in the region through policy advice, financial support, and adequate and timely technical assistance," Mr Al Tayer said.

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