Need to deliver changes quickly : IMF Chief

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Vikram Pandit buys Citi stock worth $8.4 mNeed to deliver changes quickly : IMF Chief

WASHINGTON :: The International Monetary Fund's new Managing Director Dominique Strauss-Kahn said on Friday he had lobbied for the job promising reforms and would now have to deliver change quickly at the global institution.

Facing reporters for the first time since taking his post on Thursday, the former French Socialist finance minister said the IMF faced critical questions about its relevance and effectiveness in a changing world economy.

As he picks up the reins from Spaniard Rodrigo Rato, Strauss-Kahn also acknowledged that changing the 63-year-old institution would not happen overnight.

"There are definite questions which are at stake for the institution, namely ... what are we going to do in a changing world and how can we do that," he said.

Those changes have been brought on by the fast rise of emerging powers such as China and India that are now sources of economic growth and stability while the United States and Europe grapple with slowing economic growth and the effects of recent credit and liquidity problems in world markets.

That shift has never been reflected in the voting power of the 185-member fund, which has been dominated by the United States and Europe since its inception after World War Two.

An intensely political process to shift voting power to emerging economies was initiated by Rato in 2005 as developing economies increased their calls for a greater stake in the world's premier financial institution.

Strauss-Kahn said the shift in voting power needed to be a significant one but the IMF's reform had to go beyond simply increasing the stake of emerging economies.

"A shift has to be significant from the developed and rich countries to the low-income and emerging market countries, that is clear," Strauss-Kahn said. "But it is not enough and so on my agenda we cannot stop with only the quota question, the legitimacy of the institution must go much further," he added.

Strauss-Kahn said he had initiated a proposal for the use of a double majority voting system, which needed to be discussed by the IMF board.

The system would require two separate majorities, one based on one-country one-vote and the other on economically weighted voting power in the IMF, for any decision to be made.

Strauss-Kahn said the double voting system meant "the management will have to take into account the number of chairs supporting an idea or fighting against a proposal."

He added: "There are many other ideas like this."