March 11, 2002
Using unusually blunt language, Brazilian President Fernando Henrique Cardoso on Monday lashed out at the International Monetary Fund, saying its accounting rules should be changed to help developing nations to fend off financial crises more easily.
Speaking at the 43rd annual meeting of the Inter-American Development Bank, Cardoso fired a broadside at the Fund and its attitude toward developing nations. "Why freeze our possibilities to finance our development by using mere accounting maneuvers?" asked Cardoso, adding that the Fund's accounting rules for developing nations were not the same as those used in Europe, for example.
He also said the Fund's Special Drawing Rights should be increased to allow the IMF to react faster and more effectively in helping poorer nations fend off financial crises.
Special Drawing Rights are the IMF's artificial currency units used to supplement members' reserve assets and determine their loan availability. "We have already asked the IMF several times to clarify this issue," said the usually diplomatic Cardoso. "The answers they've given us so far were as if we were illiterates," he said. "We're not. The Peruvian President is an economist. He can read. I am a sociologist."
Cardoso's remarks, coming on the heels of an appeal from Peruvian President Alejandro Toledo that the pursuit of free-market reforms should not eclipse Latin America's need to combat widespread poverty, won Cardoso a hearty ovation.
There was no immediate comment from IMF officials at the meeting. The broadside came as Latin American nations are increasingly questioning the effectiveness of free-market reforms as a bulwark against financial crises.
FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Policy Forum distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.
