UN: IMF, World Bank need reform

Global financial bodies like the International Monetary Fund and the World Bank badly need reform but the world remains divided on how to improve them, UN Secretary-General Ban Ki-moon said on Wednesday, Yahoo News reported.

"The world institutions created generations ago must be made more accountable, more representative and more effective," Ban said at the opening of a three-day meeting of the UN General Assembly on the global financial crisis and its impact on the developing world.

"I regret that financial institutional reform has divided (UN) member states," he said. The question of reforming the IMF, World Bank and other international financial bodies was one of the issues that the 126 nations participating in this week's financial crisis had struggled to agree on during months of negotiations on a set of proposals for reforming the global financial system. A 15-page draft outlining the proposals, which delegates hope to approve on Friday, does call for improving the IMF.

The draft, obtained by Reuters, said nations "recognise that it is imperative to undertake, as a matter of priority, a comprehensive and fast tracked reform of the IMF ... to increase its credibility and accountability, its legitimacy and effectiveness."

But the only specific reform it calls for is that the decision-making power of emerging market and developing states be increased in the next IMF quota review by early 2011.