By Lalit K JhaWashington, Oct 14 (PTI) The US today called for theInternational Monetary Fund to improve its operationalefficiency, and serve as a model on budget discipline andefficient use of limited resources.
"The IMF should find ways to further enhance itsoperational efficiency," US Treasury Secretary Steven Mnuchintold a gathering of world finance ministers and head ofcentral bankers here.
As a public institution – just like the memberinstitutions it monitors and advises – the IMF should serve asa model on budget discipline and efficient use of limitedresources, he said in his address to the annual meeting of theIMF and World Bank.
"Achieving this goal will necessarily entail toughchoices, potentially with regard to management and staffsalaries and benefits," he said.
Asserting that the IMF plays an important role in theinternational monetary system through the promotion ofeconomic stability and global growth, Mnuchin said to bestexecute this role, the IMF must deliver on its core mandate.
It can do so by encouraging stable exchange rates thatreflect underlying economic fundamentals, promoting soundpublic financial management and a market-oriented regulatoryframework, and pressing for independent central banks topursue transparent monetary policy, he said.
As the IMF moves into the post-global financial crisisperiod, Mnuchin urged it to structure its lending programmesto prioritise reforms that drive private sector-led economicgrowth.
In too many countries, a large public sector crowds outthe private sector. In others, a burdensome and inefficienttax system or excessive regulatory barriers fail to createeffective incentives for private sector capital and labourmobilisation, the US treasury secretary said.
The IMF must design programmes with the right policyreforms, in the right sequence, to support the private sectoras the growth engine, he told the gathering.
"In this vein, we strongly approve of IMF efforts toreassess how the institution addresses corruption in membercountries. Corruption at all levels of government wastespublic resources and often deters private sector investmentand growth," he said.
Observing that the IMF also has a key role to play inpromoting stronger debt management processes, particularly inlow income countries, he welcomed its work to strengthen thelow-income debt sustainability framework.
The framework's effectiveness, however, depends cruciallyon accurate and complete debt data, he said.
"The IMF should press for timely, accurate, andcomprehensive debt information from borrowers and creditors –including private sector and emerging market debt – to improvetransparency and reduce the negative outcomes of opaquelending," Mnuchin said. PTI LKJKUN.
This is unedited, unformatted feed from the Press Trust of India wire.