U.S. Likely to Back Increased Funds for IMF, Official Says

The United States is likely to agree soon to back an increase of up to $80 billion in the International Monetary Fund’s resources so it can boost growth in poor countries and cushion any economic shocks in the industrial world, a top IMF official said Monday.

Dutch Finance Minister Onno Ruding, chairman of the IMF’s policy-making Interim Committee, said he expected an increase by the end of the year of between 50% and 67% in the fund’s pool of resources, now $120 billion.

“It’s very well possible that it will be 67%,” Ruding told a news conference after the committee met.

For an increase to occur, U.S. Treasury Secretary Nicholas F. Brady would have to back off from his insistence on Sunday that the IMF had no pressing need for more money.

The United States, as the largest economy, has the power of veto in the 152-nation agency, which makes loans to countries with balance-of-payment difficulties.

Brady said he was committed to making a decision on extra resources by the end of the year and U.S. officials say they will have more flexibility to ask Congress for the money once the 1990 budget has been finalized, probably in mid-October.

Ruding said the IMF had enough cash for now, but added: “From the date of a political agreement, it takes up to two years before the necessary ratifications can be reached.”

Separately, Japanese Finance Minister Ryutaro Hashimoto warned Monday that if Japan is not given a ranking within the IMF that matches its growing global influence, his Liberal Democratic Party may have trouble in getting the legislature to continue financial support for international lending agencies.

Hashimoto said that Japan should rank second, behind the United States, when IMF “quotas”--deposits by members--are increased. Japan now ranks fifth.