Mr Jagdeo, Guayanese Finance Minister, has attacked the IMF for its lack of commitment to debt reduction and using the HIPC Initiative as a means of forcing countries to comply with ESAF programmes.
Action to change the IMF’s Articles of Agreement to extend the Fund’s purview to cover capital account liberalisation has been put on hold since the financial crisis.
Leading non-governmental thinkers and advocates met in Ottawa in parallel with the Commonwealth Finance Ministers’ meeting to discuss financial crises and the needs of the world’s most vulnerable and poorest people.
In late October the G7 took limited steps to strengthen the international financial architecture, after the World Bank-IMF annual meetings ended with a plethora of proposals but no substantive agreement.
Investors’ growing aversion to risk is leading to a general withdrawal of finance from many Southern countries.
There are signs that the IMF may be reconsidering its stance that all capital flows are harmful.
Borrowers from the International Bank for Reconstruction and Development (IBRD), the main World Bank lending arm, may have to pay higher charges for their loans in the future.
The UK government is leading the effort to enable the IMF to pursue capital account liberalisation (CAL) in its member countries.
An estimated 70,000 people demonstrated in Birmingham to call on G8 leaders to cancel poor countries’ unpayable debts.
In addition to extending the IMF’s role, its governors have been examining measures to prevent future financial sector crises.