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Annual Meeting 2007

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June 2007
Washington, DC

The 2007 Annual Meeting of the Bretton Woods Committee was held on June 12th, at the International Monetary Fund headquarters in Washington, DC. Attendees of the meeting heard from the leadership of the Bretton Woods institutions and participated in interactive discussion sessions. The meeting ended with a luncheon plenary.

Gerald E. Corrigan, Co-Chair of the Bretton Woods Committee, opened the meeting with a brief global financial update. He warned that while the global economy appears to be in good shape, it would be highly imprudent to assume that either the business or credit cycle were dead. Mr. Corrigan then introduced Rodrigo de Rato, Managing Director of the IMF.

Developments on the International Finance Landscape: A Dramatically Different IMF

Mr. de Rato spoke about the importance of IMF (Fund) reform in an age of financial globalization, drawing particular attention to three issues: surveillance, funding, and governance.

Surveillance: Mr. de Rato called for a revisiting of the legal framework for the IMF's surveillance of exchange rate policies, which were set out in 1977. He emphasized that changes were necessary to ensure that the IMF can be attentive to its members.

Funding: On the issue of funding, Mr. de Rato discussed the report of the Committee to Study Sustainable Long-term Financing of the IMF. The Committee, led by Sir Andrew Crockett, issued its report at the start of the year.

Governance: The final issue addressed by the Managing Director was that of IMF governance reform. Mr. de Rato discussed the negotiations over quota changes and pointed out that in order to maintain the institution's legitimacy, all members must have adequate representation.

Following Mr. de Rato's remarks, attendees broke into two groups for concurrent interactive sessions.

What is the Fund's Role in the Future?

One session, moderated by Gerry Corrigan, dealt with the future of the IMF.

Nancy Jacklin, a former U.S. Executive Director at the IMF, agreed with Mr. de Rato that the surveillance role of the IMF is in need of a revision. She explained that because of global economic integration, the IMF should focus on the international effects of policies rather than the domestic ones. She also warned against a possible reduction in the American quota at the IMF.

Ted Truman, a Senior Fellow at the Peterson Institute for International Economics, discussed four aspects of the IMF's non-lending activities where the Fund could enhance its performance: exchange rate policies, multilateral surveillance, financial stability, standards and codes, and the accumulation and management of reserves and their holdings of cross-border assets. On the area of exchange rates, he accused the IMF staff of "excessive timidity."

Congressional Perspectives on the IMF and World Bank

In the second session, moderated by Committee Co-Chair Bill Frenzel, attendees heard about congressional perspectives on the IMF and the World Bank.

Scott Morris, a professional staff member of the House Financial Services Committee outlined congressional priorities with regards to the IMF. Mr. Morris said that the key areas of congressional interest are the surveillance issue and the role of the Fund in poor countries. He also warned that IMF bills would come with conditionality, a warning that was echoed by the two other panelists.

Julie Chon, the International Economic Advisor to Chris Dodd, Chairman of the Senate Banking committee, explained how low levels of congressional confidence in the IMF were leading to a trade remedy for the exchange rate issue with respect to China. She cautioned that a "vacuum of leadership" on exchange rates could seriously undermine the international financial institutions.

While agreeing with the other panelists, Nilmini Rubin, a member of the minority staff of the Senate Foreign Relations Committee focused her remarks on the need for greater outreach when it comes to funding the Bretton Woods institutions. She explained that members of congress need to be able to explain to their constituents why they are funding the institutions and expressed her regret that she had never had a local group advocating for the institutions.

Progress Report on Multilateral Trade Talks

After the breakout sessions, attendees reconvened to be addressed by Pascal Lamy, Director General of the World Trade Organization via videoconference from the WTO headquarters in Geneva. Mr. Lamy presented an update on the Doha Round of trade negotiations. He emphasized the importance of reaching an agreement on agriculture and called for additional effort from Americans in this area. He also encouraged the renewal of Fast Track authority, which he explained would be seen as a token of good faith by negotiating partners.

Multilateral Collaboration: Collaborating, Reinforcing and Rationalizing Multilateral Efforts

Following a brief Question and Answer session with Mr. Lamy, Graeme Wheeler, Managing Director of the World Bank, discussed the World Bank's growing role as a full service banking provider and knowledge broker. Mr. Wheeler also discussed the role of the International Development Association and its importance both as a platform for other donors to build upon, and as a mechanism for increasing aid effectiveness. He expressed his hope that there would be sufficient funding for IDA 15.

Mr. Wheeler, Mr. de Rato and Mr. Lamy then addressed the issue of collaboration between the three institutions and answered questions from the Plenary moderator David Lipton, Managing Director for Global Country Risk Management at Citigroup.

Partnerships with Multilateral Institutions: What Can Be Achieved?

During the ensuing luncheon, there were three presentations. First, Clay Lowery, Assistant Secretary for International Affairs at the Department of Treasury, outlined their work on the foreign affairs budget. Mr. Lowery expressed his hope that Congress would agree to fund the arrears they had requested.

Elizabeth Littlefield, CEO of the Consultative Group to Assist the Poor, spoke about the role of microfinance in the developing world. She cautioned that the accounts of microfinance loans leading to the establishment of small businesses remained largely a myth. Nevertheless, access to microfinance can improve the lives of individuals.

Matthew Clark, Director of Global Strategic Accounts for Microsoft Corporation, discussed his experiences of working with the multilateral institutions. While Mr. Clark expressed that collaboration between the institutions and the private sector is both possible and beneficial, he explained the challenge as one of maintaining enthusiasm and engagement between partners.

Audio Transcripts:

Use the player above to listen now or right-click on any of the following links and select "Save as.." to download the individual audio files to your computer.

Videos:

  • Developments on the International Finance Landscape: A Dramatically Different IMF
    Watch now | Download [MP4, 249MB]
  • What is the Fund's Role in the Future?
    Watch now | Download [MP4, 273MB]
  • Congressional Perspectives on the IMF and World Bank
    Watch now | Download [MP4, 279MB]
  • Partnerships with Multilateral Institutions: What Can Be Achieved?
    Watch now | Download [MP4, 292MB]
  • Progress Report on Multilateral Trade Talks & Multilateral Collaboration
    Watch now | Download [MP4, 333MB]



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