A bill ratifying International Monetary Fund (IMF) quota increases for member countries was approved in Greek Parliament’s Standing Committee on Economic Affairs on Tuesday, and will be tabled in plenary on Wednesday.
The bill is named “Ratification of the no. 79-1 Decision of the Board of Governors of the International Monetary Fund related to the 16th General Review of Quotas and the chart for the reduction of New Lending Arrangements.”
It was approved by ruling New Democracy, while main opposition SYRIZA-Progressive Alliance, PASOK-Movement for Change (KINAL), and Plefsi Eleftherias reserved judgment for the plenary session. The Communist Party of Greece (KKE), Elliniki Lysi, Nea Aristera, Niki, and Spartiates voted against it.
Greece’s quotas
Quotas are the building blocks of the IMF’s financial and governance structure; an individual member country’s quota broadly reflects its relative position in the world economy. Quotas are denominated in Special Drawing Rights (SDRs), the IMF’s unit of account.
In December 2023, the IMF Board approved the increase of IMF members’ quotas by 50 percent (Special Drawing Rights/SDR 238.6 billion, or US $ 320 billion). Following the Board’s approval, member countries must agree to consent to their respective quota increases by November 15, 2024. For Greece, the decision specifically increases the country’s quotas from 2.48 billion SDR to 3.64 billion SDR, and reduces the new lending arrangements from 1.68 billion SDR to 1.40 billion SDR.
In a statement following the approval in December 2023, the IMF had said that its Executive Board, which had made the proposal, “also recognized and informed the Board of Governors of the urgency and importance of quota share realignment to better reflect members’ relative positions in the world economy, while protecting the quota shares of the poorest members.”
Statements in committee
Addressing the parliamentary committee, Deputy National Economy & Finance Minister Christos Dimas said that the rise in IMF quotas is related to the Fund’s ability to continue to provide aid to weaker countries, a role that was further enhanced during the years of consecutive crises hitting mosty vulnerable countries. “Greece supports this role of the Fund, which is proven by the provision of funds from our country to the Poverty Reduction and Growth Trust, through which the IMF provides funding on very favorable terms to countries of low incomes.”
He added that ratifying the bill would enhance Greece’s credibility and prestige by participating in a large international economic organization that serves as a last-recourse lender in cases of serious fiscal imbalances or imbalances in their balance of payments.
