Thursday, December 11, 2014

With IMF Reform Not in CRomnibus, Lagarde Fights Back -- in January


By Matthew Russell Lee

UNITED NATIONS, December 11 -- With IMF quota reform not included in the more than 1000 pages of the US Continuing Resolution / Omnibus known as CRomnibus, what now will IMF Managing Director Christine Lagarde do?


  At the first IMF embargoed press briefing in four weeks, Deputy Spokesperson William Murray was asked (Inner City Press submitted this and five other questions before the briefing, see below.)

  Murray referred to Lagarde's Work Plan for 2015, also under embargo until 10:30 am. Now, at that time, here it is, Paragraph 12:

"12. Governance and resources. Prompt entry into force of the 2010 Quota and Governance reforms is of utmost importance to preserve the quota-based nature of the IMF, and strengthen its legitimacy, effectiveness and relevance. In line with the IMFC’s commitment to maintaining a strong and adequately-resourced IMF, steps will also be taken to ensure the availability of sufficient Fund resources for crisis prevention and resolution. As flagged in the Spring WP, in the event that the 2010 Board Reform Amendment and the 14th General Review of Quotas have not become effective by the end of 2014, a Board meeting on alternative options for rebalancing quotas and increasing Fund resources will be scheduled for January 2015. The Board will discuss a draft report to the Board of Governors on the
15th General Review of Quotas before the end-January deadline for the completion of the 9 Review. The timing of Board meetings on the 15th General Review and on revisions to the quota formula will be determined, taking into account progress made in ratifying the 2010 reforms."

 So there will be an IMF Board meeting in January on the topic. Murray said the date of the next briefing, in January, is not yet set, pending the date of Lagarde's cusp of the year speech then travel to Davos. Watch this site.

  Inner City Press on December 11 - actually, submitted December 10 -- asked:

If not asked “in the room,” what if the IMF's response to IMF quota not being included in the US Congress' end of year Continuing Resolution / Omnibus?

On Yemen, does Saudi Arabia withholding budget support due to advances by the Houthis impact the IMF's program or predictions? Relatedly, what is the IMF's response to the Yemeni central bank's Mohammed Bin Humam being quoted that “our current level of foreign reserves is still sufficient and in line with our program with the IMF”?

On Ireland, what is the IMF's response to protests against its role in the raised water charges for consumers in that country?

What is the IMF's response to UNASUR Secretary-General Ernesto Samper being quoted, Dec 8 in Quito, opposing Managing Director Lagarde's comments on Latin America and that “the IMF does not have the moral authority to give any recommendations to us after we were subject to their constraints for many years, negating any possibility for progress”?


On Dec 10, the UN's Department of Economic and Social Affairs' World Economic Situation and Prospects 2015 report addressed Ebola imposing “major economic costs in the affected countries through disruptions to travel and trade.” What are the IMF's estimates now of Ebola's impact?


  Watch this site.

  Who to believe on when Ebola will be under control: the UN or the International Monetary Fund? Or are the two using different definitions? Inner City Press on November 13 asked the IMF and then the UN.
  When the IMF held its biweekly embargoed media briefing on Thursday, November 13, Inner City Press again asked about Ebola, including new World Bank estimates of budget shortfalls in Liberia.
 Inner City Press on November 13 asked, "On Ebola, what is the IMF's response to the US call for debt forgiveness for three countries? The World Bank has indicated that Liberia's revised 2014-15 budget has an unmet financing gap of more than half of the budget deficit projected at over $300 million. What can or will the IMF do about this?"
  IMF Deputy Spokesperson William Murray replied that given the flare up of Ebola cases in unexpected areas. "The IMF staff's previously projections were assuming the epidemic would be brought under control in the first quarter of 2015. However it now appears that it could be well into the second half of 2015 before the Ebola epidemic is brought under control in these three countries."
   Three hours later at the end of a UN General Assembly session on Ebola, Inner City Press asked a panel of UNGA President Sam Kutesa and UN Ebola envoys Anthony Banbury and David Navarro about the IMF's new projection: is it consonant with the UN's?
  It was Tony Banbury who answered, saying that the UN is aiming at 70% safe burials for example by December 1 and to turn the Ebola epidemic around.
  Is that the same thing as getting the epidemic "under control," the definition under which the IMF now projects the second half of 2015?  The work goes on. Watch this site.
  The day before at the UN on November 12 when the UN Security Council met, Liberia's Ambassador Marjon Kamara spoke not of the IMF but of the World Bank, saying "the World Bank recently gave a gloomy depiction of the economic effects of the disease on the three most affected countries - Guinea, Liberia and Sierra Leone."
     Per Thoresson, Deputy Ambassador of Sweden which chairs the UN Peacebuilding configuration on Liberia, specified that “according to the World Bank, the two-year regional financial impact could reach $32.6 billion by the end of 2015. The World Bank also indicated that Liberia's revised 2014-15 budget has an unmet financing gap of more than half of the budget deficit projected at over $300 million.”
  So where's the money going to come from? Back on October 30, Inner City Press asked the International Monetary Fund about its stated $130 million commitment to Liberia, Sierra Leone and Guinea.
   Inner City Press asked IMF spokesperson Gerry Rice for an update at the IMF's embargoed briefing on October 30.
  Rice said the outlook has worsened, with region-wide fall offs in travel and tourism. As to the three countries most impacted, there are "large financing needs likely for 2015."
  At the Annual Meetings earlier this month, the IMF met with the three countries' authorities, Rice said. "2015 is going to be a challenging year." If the outbreak spreads, it would have larger spillovers. The IMF, Rice said, is ready. We'll see.
  In the UN Security Council on November 12, the head of UN Peacekeeping Herve Ladsous recited that Justice Minister Christiana Tah resigned and five soldiers have been demoted for disciplinary offenses while enforcing a quarantine of an Ebola-affected community in Monrovia.
  Under Ladsous, it must be noted, UN Peackeeping has covered up attacks on civilians in Darfur and the Central African Republic. Ladsous himself refused repeatedly to answer Press questions about rapes by his partners in the DR Congo Army. Video compilation here. Most recently, Ladsous tried to block the Press' camera, Vine here. Thus is the UN UNdercut.
  Also during the October 30 embargoed IMF briefing, Inner City Press submitted this question: "On Ghana, does the IMF have any comment on the October 28 launch of the “Civil Society Organization Platform on the IMF Bailout to Ghana”? Will the IMF meet with the group?")
 On Ebola back on August 28 Rice told Inner City Press that the IMF was working on the ebola crisis with the government of Liberia, Sierra Leone and Guinea.  Later came the $130 million commitment.
  While most questions on August 28 concerned IMF Managing Director Christine Lagarde being under investigation -- she will brief the IMF Board “very soon,” Rice said, calling it “highly unlikely” it would be on August 29 along with the Board's meeting on Ukraine -- Inner City Press also asked about Yemen, Ghana, Pakistan -- and ebola, IMF transcript here:
“Has the IMF produced any estimates of the impact of the ebola crisis? Any IMF responses to it?”
  Rice read out the question, then said that ebola's "acute impacts" are “macro-economic” and social, hitting three “already fragile” countries (Guinea, Liberia and Sierra Leone). He said "growth is likely to slow sharply in all three cases" and significant financial needs will rise: "increased poverty and food insecurity" and impacts on employment in the key agricultural sector.
  Rice concluded, "We are actively working with all three countries to prepare... additional financing that may be required."

Watch this site.
 
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