Saturday, April 25, 2015
China’s Offering a World Bank Alternative — and U.S. Allies Are Signing Up
The United States and 15 developed countries control 52 percent of voting rights at the IMF, leaving 48 percent for the 168 other member countries. China, now the world’s biggest economy, has only 3.8 percent of voting power — that’s a smaller share than those of the UK, France, Germany, or Japan. Brazil, South Korea, and Mexico each enjoy less voting power than tiny Belgium.
Despite much protest from the BRICS and other developing economies, they’ve received just 6 percent more voting power over the last 20 years. The proportions and trends have been roughly the same at the World Bank.
The United States and the Europeans have also held tightly to what’s been characterized as their “feudal” prerogatives of filling the World Bank presidency with a U.S. citizen and the managing director post at the IMF with a European.
With some 17 percent of the vote in both institutions, the United States also exercises veto power over key policy decisions. To show that it didn’t want to replicate the Americans’ behavior at the World Bank, Beijing announced that despite its contribution of the largest share of capital to the AIIB, it would not demand veto power over policy decisions.
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