Fin24

Lagarde: IMF war chest needs $400bn boost

2012-04-17 09:57

Frankfurt - The head of the International Monetary Fund (IMF) on Tuesday called for members to loan more than $400bn to the global lending body, ahead of a crunch meeting to debate crisis financing.

Asked by German daily Frankfurt Allgemeine Zeitung how much the fund needed in additional firepower should other eurozone countries required a bailout, Christine Lagarde said: "$400bn plus".

"My hope is that we will get a critical mass this week," said Lagarde.

She had previously called for an additional $500bn dollars to boost the fund's war chest in case more debt-ridden eurozone states fall victim to the crisis.

At a meeting of finance ministers and central bank chiefs from the IMF in Washington starting April 20, officials will discuss the extra financing the fund needs to combat the debt crisis.

The eurozone had appealed to the IMF to bolster its firewall against the crisis but emerging economies and the United States demanded the 17-nation bloc first puts its hand in its pocket.

After a month of wrangling and some German resistance, the eurozone last month clinched a deal it claimed was worth more than $1 trillion, even though €300bn of that was in loans already pledged.