The world needs a supervisory body for financial markets to which end the International Monetary Fund (IMF) must become more independent, German President and former IMF chief Horst Koehler said on Friday.
“I urge us to create an international supervisory organization, and I think it’s right that the International Monetary Fund should be given the task of overseeing the stability of the global financial system,” he said according to the text of a speech at a banking congress in Frankfurt.
“In order for it to be able to perform this task effectively, the IMF should be granted more independence,” added Koehler, who was head of the IMF between 2000 and 2004. Koehler said a major cause of the global financial crisis had been the emergence of massive “current account imbalances” between major economies. Analysts regularly cite the U.S. current account deficit as such an imbalance.
“We need a binding political process which ensures that these global imbalances are reduced and cannot come about again in this form,” said Koehler. “This also requires a discussion about exchange rates, and a clear rejection of egotism and protectionism.”
German presidents have traditionally shied away from commenting on specific aspects of economic policy, but Koehler has shown less reluctance to weigh in than his predecessors have.
(Writing by Dave Graham, editing by Chris Pizzey)
Topics Germany
Was this article valuable?
Here are more articles you may enjoy.
4,800 Claims Handled by Unlicensed Adjusters in Florida After Irma, Lawsuit Says 
Miami Retirement Fund Class Action Alleges Globe Life Officers Concealed Fraud 
‘Buffett Got it Wrong’ on California Fire Risk: PG&E CEO 
The Top 15 U.S. Metros with High Exposure to Wildfire Risk 
