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US legislators: IMF needs more money to keep nations from failing

Mar 18, 2009, 17:02 GMT

Washington - The International Monetary Fund must be given more resources to rescue poorer nations battered by the financial crisis, US legislators said Wednesday, calling the global recession a threat to national security. Democratic Senator John Kerry, who heads the Senate Foreign Relations Committee, warned the economic crisis had the potential to create 'failed states' that could become breeding grounds for terrorism, drug trafficking and other security threats. 'In the end, you invite chaos if you don't ... lead in the right direction,' Kerry said after a private committee meeting with the heads of the IMF and its sister organization the World Bank. Dozens of developing countries around the world - especially in central and eastern Europe - are facing massive budget shortfalls as local banks fail and wealthy investors have pulled out resources due to the financial crisis back home. President Barack Obama's administration has called for at least 500 billion dollars - 100 billion from the United States - in extra funding for the IMF, which serves as a backstop for governments that need emergency loans. Kerry and Republican Senator Richard Lugar said there was bipartisan support among legislators in the committee for increasing the IMF's resources.

Business News

US legislators: IMF needs more money to keep nations from failing

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