China, which has the third highest voting power in the World Bank now, on Monday said giving a larger say to countries like China and India in the Bank is the first reform to achieve equitable power between the developed and developing countries, besides helping the IMF quota reforms.
Hailing the hike in voting power of the developing nations in the World Bank as a historic moment, Chinese Finance Minister Xie Xuren said the shift of voting power laid a foundation for deepening related reforms of the World Bank.
“This is the first reform that aims at enhancing voice and participation of the developing and transition countries in the World Bank’s history. It will contribute to achieving the ultimate goal of equitable voting power between developing countries and the developed ones,” Mr. Xie said in a statement, adding the reform will also have a model effect, which will help promote International Monetary Fund’s quota reforms.
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The voting pattern shift will increase the number of votes of the developing world to 47.19 per cent from 44.06 per cent. And China’s stake at the bank, in terms of voting power, rises from 2.78 to 4.42 per cent now, making it the third largest, next to the U.S. (15.85 per cent) Japan (6.84 percent).
Post-reforms, India has moved to the seventh spot with 2.91 per cent voting right.
“This reform has increased the representation and voice of the developing countries and makes the World Bank’s governance structure fairer and more reasonable. It will protect interests of the developing countries and provide them chances to play a bigger role. It will also enhance the World Bank’s contribution to helping developing countries’ economic development and poverty reduction,”,” Xinhua quoted Mr. Xie as saying in Washington today.
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The World Bank member—countries reached an agreement on a 3.13—per cent shift in voting power to give the emerging and developing nations greater influence in the Bank last week.
Mr. Xie said the reform reflects the reality of enhanced economic power and status of the developing world. The rise in China’s voting power will strengthen cooperation between China and these Washington—based multilateral lenders.
The achievement is “only part of the ongoing process,” he said noting China supported periodic review of the International Bank for Reconstruction and Development (IBRD) shareholding in future. The IBRD is the original institution of the World Bank Group and normally represents the group.
“The future shareholding principles must continue to be based on economic weight, give full consideration to the contribution of the developing world to IBRD as development partners, and aim to achieve the ultimate goal of equitable voting power between the developing countries and the developed ones,” he said.