The G24, an inter-governmental club representing developing countries, is to set up a working group to boost its influence at the IMF and World Bank. This group will set the agenda for the G24 by the next Annual Meetings and its establishment reflects frustration with progress on promises made by developed countries to loosen their grip on the Bretton Woods institutions.
The G24 working group is to be headed by senior staff and once broad parameters are defined, a technical group will research the key issues and develop a position behind which all members can rally. The group will be open to all countries, developed and developing.
The group will start by examining the governance of the International Financial Institutions, focusing on the call for a greater share of votes and quotas for developing countries. Other issues to be considered include a better funded mechanism for tackling and resolving crises and more assistance in helping low- and middle-income countries achieve the Millennium Development Goals. The G24 also proposes a simpler formula of quotas and votes to give greater weight to measures of purchasing power parity, rather than market exchange rates which skew quotas in favour of developed countries.
Officials at the G24 told Emerging Markets that they have called for the Fund to "go back to basics" and focus on areas once considered its primary domain. This includes, for example, a more active role in making recommendations on managing exchange rates.
Furthermore, officials say that although they do not want the Fund to become heavily involved in development issues - which the G24 believes should remain the preserve of the Bank - the Fund must retain and enhance its ability to lend in times of crisis.