UK signs over £10bn for the IMF

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**SilverMK2**

Another £10bn into the IMF black hole while the UK slashes spending at home and increases taxes for pretty much everyone (except the richest who get a tax break?!?)?

http://www.independent.co.uk/news/uk/politics/osborne-signs-10bn-cheque-for-new-bailout-loan-to-the-imf-7665926.html

After clutching his cards close to his chest for weeks, George Osborne showed his hand yesterday. What the Chancellor revealed was a $15bn (£10bn) cheque for the International Monetary Fund.

Mr Osborne, attending the spring meeting of the IMF and the World Bank in Washington DC, said the decision to bolster the resources of the lender of last resort for distressed economies was firmly in Britain's national interests.

"Jobs and growth in Britain depend on stable world economy," he said. "That needs a strong IMF. The UK sees itself as part of the solution to the global debt crisis rather than adding to it."

But he was quick to point out that the extra £10bn in loans, which will be drawn from Britain's currency reserves, would not require a vote of approval in Parliament. MPs voted last July to raise the UK's commitment to the IMF up to a ceiling of £40bn. Only £30bn has been drawn down so far, enabling Mr Osborne to avoid a fresh vote for his new £10bn pledge. Last year, 32 Conservatives voted against the increase.

Yesterday, the Chancellor was at pains to stress that the new funds were not specifically earmarked to assist the eurozone, although Spain and Italy are widely known as the two economies most likely to need an IMF bailout soon.

Eurosceptic Tory backbenchers, who oppose any additional UK contributions to the IMF that could end up being used to support single currency nations, were restive last night. Peter Bone described the decision as "bonkers".

Labour was also critical, saying European governments had not yet done enough to help themselves. The shadow Chancellor, Ed Balls, said: "It is disappointing that the Chancellor has not taken the opportunity to press the wealthy eurozone countries to dig into their own pockets and establish a strong firewall of their own, before offering up more funding from Britain."

Mr Osborne said Britain would earn interest on its increased loan commitments and pointed out that no country had ever lost money lending to the IMF. The fund is a preferred creditor whenever it bails out countries, meaning it must be repaid before anyone else.

The UK pledge coincided with new commitments to the IMF from Australia ($7bn), Singapore ($4bn) and South Korea ($15bn). In total the IMF director, Christine Lagarde, managed to raise the Fund's lending resources by $430bn.

Earlier this week, Japan pledged $60bn. Sweden has committed $10bn, Poland $8bn, Switzerland $26bn and Denmark $7bn. Eurozone countries promised $200bn. But the IMF's largest shareholder, the US, has refused to offer more this time.

**Bromsy**

I am forgainst it.

**AustonT**

IMF's largest shareholder, the US, has refused to offer more this time.

Let's hope that after this the UK does the same. feth the IMF.

**htj**

Finally, a way to get rid of all that excess money that the British economy currently has!

**Joey**

loan/lōn/
Noun:
A thing that is borrowed, esp. a sum of money that is expected to be paid back with interest.

Lending to others at interest is a source of income.
Grow up.

**htj**

The question is more whether it's a sound investment to make, Joey. No need to be shirty, everyone knows how loans work. Well, hopefully.

**SilverMK2**

Indeed.

**AustonT**

Joey wrote:loan/lōn/
Noun:
A thing that is borrowed, esp. a sum of money that is expected to be paid back with interest.

Lending to others at interest is a source of income.
Grow up.

No one actually expects the loans made by the IMF in the Eurozone to be paid back, let alone with interest.

**Da Boss**

The british government is propping up the IMF to protect private institutions from their own poor judgement.

It's a pretty complex question as to whether that is really smart, or colossally unjust.

But Britain has certainly profited from the lax regulation that contributed to the crash, and many british citizens are being bailed out by (for example) the Irish taxpayers who are paying their private debts for them. If the Irish government is unable to continue to pay these debts, and defaults, it will mean that there is suddenly a huge debt burden being shifted back towards the various banks and individuals. It is very likely that many of the individuals will not pay back the debt, so these support schemes are a way of retrieving some of the value.

**Joey**

AustonT wrote:
Joey wrote:loan/lōn/
Noun:
A thing that is borrowed, esp. a sum of money that is expected to be paid back with interest.

Lending to others at interest is a source of income.
Grow up.

No one actually expects the loans made by the IMF in the Eurozone to be paid back, let alone with interest.

Weird, everyone's been predicting the EU will fall apart for the last 2 years. Well, everyone outside of continental Europe.
The EU has the combined economies of Germany, France, The Netherlands, Belgium, the United Kingdom, to name only the stable Northern countries.
You may as well as say California's budget deficit will bankrupt the USA. There is integral strength in the European economy as well as a huge amount of political will into making it work.
Hell the Germans have imposed unelected governments on Italy and Greece in an effort to make it work. That in itself is incredible.

**AustonT**

Joey wrote:
AustonT wrote:
Hell the Germans have imposed unelected governments on Italy and Greece in an effort to make it work. That in itself is incredible.

I am SHOCKED, shocked I tell you that the Germans have imposed thier technocracy on other countries...oh wait.

**Da Boss**

The Germans have done bugger all. Please don't spread rubbish like that around the forum.