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G20 to end West’s hold on IMF, World Bank

world Updated: Jun 27, 2010 01:31 IST

Agencies
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The leaders of the world’s 20 top economies are set to end the 60-year domination by Europe and the US of the World Bank and International Monetary Fund (IMF) at a summit here this weekend, draft documents say.

But they are not expected to approve European Union calls for a worldwide levy on bank risk-taking and a tax on financial transactions, German Chancellor Angela Merkel said.

The leaders of the Group of 20 (G20) “agree that the heads and senior leadership of the international financial institutions should be appointed without regard to candidate nationality”, read a draft summit statement seen by DPA. G20 leaders still have to approve the text.

Since the two bodies were founded after World War II, the World Bank has traditionally been headed by an American while the head of the IMF has been a European.

But the emergence of new powers such as Brazil, China and India has led for calls to overhaul that system.

The G20 itself embodies that change. Since its first summit in November 2008, the club of the major developed and developing states has emerged as the world’s most important economic body. The G20 is “the premier forum for our international economic cooperation”, the draft says.

Merkel said after talks with the smaller Group of Eight (G8, which joins the world’s major developed economies) that neither body was likely to endorse EU calls for bank and transaction taxes.

G8 condemn N.Korea

The Group of Eight rich nations condemned North Korea for an attack which sank a South Korean naval ship and called on Iran’s leaders to respect rule of law and freedom of expression.

In a draft communique at their summit in Huntsville, the G8 also asked Afghanistan’s government to be ready by a July conference in Kabul to show its allies it is making tangible progress on assuming greater security responsibility.