The EU has "offered" a solution of rotating seats, but according to the Wall Street Journal, this offer is likely to be denied.
And today, from the Herald Sun:
China urges EU to cede IMF power to emerging marketsSource HERE.
CHINESE Premier Wen Jiabao urged Europe overnight to cede more power to emerging markets in international financial institutions, as South Korea welcomed an EU offer to give up some IMF seats.
Mr Wen made his appeal in a speech at the opening of the Asia-Europe Meeting (ASEM) amid complaints by emerging economies that Europe is over-represented at the International Monetary Fund.
"We need to improve the decision-making process and mechanisms of the international financial insitutions," Mr Wen told fellow Asian and European leaders gathered at the royal palace in Brussels.
The Chinese Premier said there was a need to "increase the representation and voice of developing countries, encourage wider participation and fully accommodate each other's interests and concerns".
European finance ministers last week agreed to hold talks with the US and other partners on reviewing EU representation at the Washington-based international lender.
A top official from South Korea, which will host the summit of G20 leaders in Seoul in November, welcomed the proposal as a "great improvement".
"The Europeans show some flexibility and also offer some solutions," Changyong Rhee, head of the committee preparing the G20 meeting, told reporters on the sidelines of the ASEM summit.
"I don't know whether they will be 100 per cent accepted by the (G20) members," he said.
"But I think the fact that Europeans show flexibility and willingness to negotiate is an important advancement and I hope that the other countries will show the same kind of flexibility so that we can have a unanimous solution."
An agreement on IMF reform must be reached at a meeting of the Group of 20 rich and emerging nations on November 11-12 in the South Korean capital, Mr Rhee said.
"In order to maintain the effectiveness of the G20, I think leaders have to deliver this outcome," he said.
"I hope and expect that we should deliver on this subject."
Looking back a decade or so, the IMF seemed to be irrelevant, consigned to "saving" emerging market economies. Just ask Argentina. But now with the rising influence of the G20, the waning influence of the UN (was it ever really relevant?) The IMF seems to be the financial arm of the G20. A New World Order is definitely emerging here. And with this New World Order, amidst a growing global financial crisis, a new monetary system is bound to arise. Will these two institutions, the G20 and IMF, rise to the occassion and foster cooperation to avoid a repeat of the 1930s which led to World War II?
The currency war is still raging, recent Central Bank actions (or noticeable inactions):
Japan cuts interest rate to around zero
Australian Central Bank skips rate hike.
As I speculated in a prior post, it looks like no one is listening to Dominique Strauss-Khan. The developments continue...