World News : IMF moves to calm market fears over European debt

WASHINGTON (World News) -- Finance ministers and central bank governors hope a more than $ 430 billion increase in resources of the International Monetary Fund will be enough to handle any fresh crisis in the eurozone.

IMF Managing Director Christine Lagarde announced the new figure at the conclusion of discussions of the G-20 major economic powers Friday. She said that some countries, including Russia, India, China and Brazil, had made private pledges but did not want to issue public commitments until they had conferred with officials in their home capitals.

But she said when the public and private commitments were combined, the tota l raised would exceed $ 430 billion, nearly doubling the IMF's available resources to make loans to nations in trouble.

Lagarde called the fundraising a "huge effort" that would increase the current $ 485 billion available for loans to more than $ 1 trillion.

"We have the necessary tools in the toolbox and we will use this wisely," she told reporters at a news conference wrapping up discussions of the G-20, which includes traditional economic powers such as the United States and Germany and emerging powers such as China and Brazil.

Talks continue Saturday as the policy-setting committees of the IMF and its sister institution, the World Bank, meet. The IMF helps countries with financial crises and the bank provides loans for development projects in many poor nations. Both 188-nation organizations are based in Washington.

Lagarde said the extra resources would help support global economic stability. Finance officials hope the new lending power wi ll be a backstop should another, larger European country get into trouble in repaying government debts.

Already three European nations - Greece, Ireland and Portugal - have been forced to accept IMF rescue packages along with sizable bailout support from other nations using the euro currency. But the concern is that Spain and Italy, much larger economies, are now facing financial difficulties. If either of those nations needed rescue packages, the costs would be far higher than what has been raised so far.

Showing there was not unanimity on boosting the IMF crisis arsenal, two major members, the U.S. and Canada, refused to participate in boosting its resources. They believe European countries are wealthy enough to do more.

And the four countries that did not publicly reveal their contributions - China, Russia, India and Brazil - all expressed reservations about pledging additional resources until the IMF implements a 2010 agreement to give emerging marke t nations more of a say in how the IMF operates.

There are doubts whether the deal to boost the voting power of China and other emerging countries can be achieved anytime soon.

As Canadian Finance Minister Jim Flaherty said, "There is a tendency to agree" changing voting shares "but then not act on them."

The Europeans, who have eight seats on the 24-member IMF executive board, are reluctant to give up two seats, to make room for cash-rich emerging market countries.

Elizabeth Stuart, a spokeswoman for the development agency Oxfam, said that now that emerging market economies such as China have agreed to make increased contributions to the IMF's resources, it was important for European nations to drop their objections to reducing their voting shares in favor of the new economic powers.

"Emerging economies have kept their part of the bargain by giving the IMF the money it asked for," she said. "Europe needs to make room at the decision-making table in exchange."

Of the more than $ 430 billion in increased support that the IMF raised, the agency released a list of specific commitments from 12 individual nations ranging from $ 60 billion from Japan to $ 2 billion from the Czech Republic.

The biggest total amount was $ 200 billion pledged back in December by Europe, including $ 150 billion from nations that use the euro currency and $ 50 billion from other European countries.

The publicly announced amounts total $ 362.3 billion, leaving $ 68 billion in the pledges that Lagarde said she has received from China, Brazil, Russia and India. Officials offered no breakdown of those amounts and also did not disclose any possible timing of when these countries might make their pledges public.

The support is coming in the form of loans the countries will make to the IMF, which will be able to use those resources to make loans to countries facing financial difficulties. While most other nat ions do not have to get approval from their legislatures for these loans to be made by their central banks, the U.S. Federal Reserve cannot extend credit to the IMF without approval by Congress.