MercoPress. South Atlantic News Agency

UK calls on China and Gulf states to boost IMF resources

British Prime Minister Gordon Brown called on Tuesday for an increase in funding of the International Monetary Fund (IMF) to cut the risk of “financial contagion” and said China and oil-rich Gulf states should make the bulk of the contributions.

Brown, speaking at a news conference in London, said a "substantial" increase in the 250 billion US dollars fund would reduce the risk of "contagion" from Eastern European countries like Hungary spreading around the world. "It is in every nation's interest and in the interests of hard-working families in our country and every country that financial contagion does not spread," said Brown. "When we see the crisis unfolding in Hungary we know that we have got to take action immediately," said Brown, referring to IMF assistance for Hungary. He left open whether Britain would make any contributions to an enhanced IMF fund but made clear that he believed that countries with "big reserves" should be first in line to help. "We don't rule out anything in this, because everybody has got to play their part in helping," said Brown. "But I think that, as happened in the '70s, the big surplus countries - those that have got big reserves - are in a position to help most and we will be urging them to do so". Brown said he would raise the issue during a four-day trip to the Gulf starting on Saturday, when he will visit the leaders of Saudi Arabia, Qatar and the United Arab Emirates. He was also planning to speak by phone with Chinese premier Wen Jiabao to discuss the matter. "I believe it is possible in a very short period of time to create an international fund that is strong enough to help withstand the difficulties", said Brown. Asked to name the countries which he thought able to provide the largest additional funding, Brown said: "It is the countries that have substantial reserves - the oil-rich countries and others - who are going to be the biggest contributors to this fund." "China also has very substantial reserves. There is a number of countries that actually can do quite a lot in the immediate future to make sure that the international community has sufficient resources to support countries that get themselves into difficulties," said Brown.