Norway offers to boost IMF with up to $4.6 billion

International Monetary Fund Managing Director Dominique Strauss-Kahn. Photo: Wikipedia

OSLO (AP) — Norway on Saturday said it has offered to boost the International Monetary Fund with up to 30 billion Norwegian kroner ($4.6 billion) in a move to help struggling countries, such as neighboring Iceland and Latvia, pull through the financial crisis.

In a statement, Norway’s Finance Minister Kristin Halvorsen said the crisis “calls for an IMF with adequate lending capacity. It is natural for Norway, who has considerable international reserves, to contribute to this end.”

“Norway’s offer has a scope of up to 30 billion Norwegian kroner,” she said.

Halvorsen on Friday sent IMF’s Managing Director Dominique Strauss-Kahn a letter saying her country was ready to make more money available.

She also informed Strauss-Kahn of Norway’s stance for next week’s G20 summit in London, saying she found it crucial that the decisions taken there are anchored in multilateral institutions such as the IMF, the Multilateral Development Banks and the United Nations.

Halvorsen said the crisis had exposed flaws “in the regulation and supervision of the financial systems in several countries,” and that efforts now need to be focused on crisis management and ways to prevent it from happening again.

“There are also lessons to be learnt for the formulation of macroeconomic policy,” she said in the letter, noting the IMF ought to be given a stronger role in surveilling the world’s financial markets.

In a separate statement, IMF’s Strauss-Kahn welcomed Norway’s offer, saying he looked forward to discussing Norway’s “final size and form of support.”

“We hope that other countries may now provide their own support to our efforts to restore stability to the global economy,” he said.

Source: Associated Press