Will America Lose the IMF?

From the May 2003 Trumpet Print Edition

International Monetary Fund (IMF) statutes require that its headquarters be located “in the territory of the member having the largest” weighted vote (Wall Street Journal, Nov. 7, 2002).

Europe is considering the idea of consolidating the voices of its many constituent countries and speaking as one legal body within this international financial institution, making it the largest IMF member.

“The main advantage of greater economic policy coordination would be a more coherent voice for the eurozone on the world stage,” said Andrew Duff, a delegate from Britain at last November’s Convention on the Future of Europe (ibid.).

The fact that a unified Europe would control 34 percent of the IMF’s total voting rights, compared to America’s current 17.2 percent, is certainly not lost on decisionmakers. Nor is the fact that it would necessitate moving IMF headquarters from Washington D.C., to Europe.

One problem to this European proposal is that only individual nations are allowed to be members of the IMF. Nevertheless, convention delegates are confident that the rules would be changed by the IMF. “We would have to negotiate accession, as it were,” said Duff, adding that “it would be impossible for the IMF to resist” (ibid.).

This is just one more example of the fact that, whether the U.S. government sees it or not, power is shifting from Washington.