Agreement on Draft Amendment of Article IV
- International Monetary Fund
- Published Date:
- February 1996
French and U.S. officials reached agreement on a draft amendment of Article IV of the Articles of Agreement of the Fund when the heads of state and government of six nations met in the Chateau de Rambouillet in France on November 15-17, 1975. Following is the text of the declaration issued on November 17, 1975 at the close of this economic summit. Paragraph 11 deals with exchange rate arrangements.
Declaration of Rambouillet
(November 17, 1975)
The Heads of States and Governments of France, the Federal Republic of Germany, Italy, Japan, the United Kingdom of Great Britain and Northern Ireland and the United States of America, met in the Chateau de Rambouillet from 15th to 17th of November, 1975, and agreed to declare as follows:
1. In these three days we held a searching and productive exchange of views on the world economic situation, on economic problems common to our countries, on their human, social, and political implications, and on plans for resolving them.
2. We came together because of shared beliefs and shared responsibilities. We are each responsible for the government of an open, democratic society, dedicated to individual liberty and social advancement. Our success will strengthen, indeed is essential to democratic societies everywhere. We are each responsible for assuring the prosperity of a major industrial economy. The growth and stability of our economies will help the entire industrial world and developing countries to prosper.
3. To assure in a world of growing interdependence the success of the objectives set out in this declaration, we intend to play our own full part and strengthen our efforts for closer international cooperation and constructive dialogue among all countries, transcending differences in stages of economic development, degrees of resource endowment, and political and social systems.
4. The industrial democracies are determined to overcome high unemployment, continuing inflation, and serious energy problems. The purpose of our meeting was to review our progress, identify more clearly the problems that we must overcome in the future, and to set a course that we will follow in the period ahead.
5. The most urgent task is to assure the recovery of our economies and to reduce the waste of human resources involved in unemployment. In consolidating the recovery it is essential to avoid unleashing additional inflationary forces which would threaten its success. The objective must be growth that is steady and lasting. In this way, consumer and business confidence will be restored.
6. We are confident that our present policies are compatible and complementary and that recovery is under way. Nevertheless, we recognize the need for vigilance and adaptability in our policies. We will not allow the recovery to falter. We will not accept another outburst of inflation.
7. We also concentrated on the need for new efforts in the areas of world trade, monetary matters, and raw materials, including energy.
8. As domestic recovery and economic expansion proceed, we must seek to restore growth in the volume of world trade. Growth and price stability will be fostered by maintenance of an open trading system. In a period where pressures are developing for a return to protectionism, it is essential for the main trading nations to confirm their commitment to the principles of the oecd [Organization for Economic Cooperation and Development] pledge and to avoid resorting to measures by which they could try to solve their problems at the expense of others, with damaging consequences in the economic, social, and political fields. There is a responsibility on all countries, especially those with strong balance of payments positions and on those with current deficits to pursue policies which will permit the expansion of world trade to their mutual advantage.
9. We believe that the multilateral trade negotiations should be accelerated. In accordance with the principles laid down in the Tokyo Declaration, they should aim at substantial tariff cuts, even eliminating tariffs in some areas, at significantly expanding agricultural trade, and at reducing nontariff measures. They should aim at achieving the maximum possible level of trade liberalization therefrom. We propose as our goal completion of the negotiations in 1977.
10. We look to an orderly and fruitful increase in our economic relations with socialist countries as an important element in progress in detente, and in world economic growth.
We will also intensify our efforts to achieve a prompt conclusion of the negotiations now under way concerning export credits.
11. With regard to monetary problems, we affirm our intention to work for greater stability. This involves efforts to restore greater stability in underlying economic and financial conditions in the world economy. At the same time, our monetary authorities will act to counter disorderly market conditions, or erratic fluctuations, in exchange rates. We welcome the rapprochement, reached at the request of many other countries, between the views of the U.S. and France on the need for stability that the reform of the international monetary system must promote. This rapprochement will facilitate agreement through the Fund at the next session of the Interim Committee in Jamaica on the outstanding issues of international monetary reform.
12. A cooperative relationship and improved understanding between the developing nations and the industrial world is fundamental to the prosperity of each. Sustained growth in our economies is necessary to growth in developing countries: and their growth contributes significantly to health in our own economies.
The present large deficits in the current accounts of the developing countries represent a critical problem for them and also for the rest of the world. This must be dealt with in a number of complementary ways. Recent proposals in several international meetings have already improved the atmosphere of the discussion between developed and developing countries. But early practical action is needed to assist the developing countries. Accordingly, we will play our part, through the Fund and other appropriate international fora, in making urgent improvements in international arrangements for the stabilization of the export earnings of developing countries and in measures to assist them in financing their deficits. In this context, priority should be given to the poorest developing countries.
13. World economic growth is clearly linked to the increasing availability of energy sources. We are determined to secure for our economies the energy sources needed for their growth. Our common interests require that we continue to cooperate in order to reduce our dependence on imported energy through conservation and the development of alternative sources. Through these measures as well as international cooperation between producer and consumer countries responding to the long-term interest of both, we shall spare no effort in order to ensure more balanced conditions and a harmonious and steady development in the world energy market.
14. We welcome the convening of the conference on international economic cooperation scheduled for December 16. We will conduct this dialogue in a positive spirit to assure that the interests of all concerned are protected and advanced. We believe that industrialized and developing countries alike have a critical stake in the future success of the world economy and in the cooperative political relationships on which it must be based.
15. We intend to intensify our cooperation on all these problems in the framework of existing institutions as well as in all the relevant international organizations.