In early September, Mr. Lieftinck proposed to the Board of Directors that a resolution or series of decisions for review and adoption be submitted to the Board of Governors at the annual meeting. He believed that a resolution by the governors could aim to give the Fund an “appropriate role” and additional powers to executive directors. The Governing Council could, for example, push the governments of Member States that have a fundamental imbalance to redirect the exchange rates of their currencies. Governors could strengthen the steering committee`s position by expressly inviting it to take all necessary steps to continue the Fund`s work in the current circumstances, to put forward proposals for greater exchange rate flexibility, and to study long-term monetary reform. Some CEOs responded favourably to Mr. Lieftinck`s proposal. However, some felt that there was not enough time to agree on a draft resolution or that the Group of Ten meetings, which were to take place before the annual meeting, would no longer necessity the need for a decision by the governors, had not been supportive of the idea. There has also been a reluctance on the part of the US authorities to get the Fund to take such measures as part of monetary reform, as indicated by a resolution of the governors. The resolution should also ensure the Fund`s role in future discussions on monetary reform.
Executive Directors were invited to submit a report to governors without delay on the necessary or desirable measures for the improvement or reform of the international monetary system. To this end, Executive Directors were specifically invited to examine all aspects of the international monetary system, including the role of reserve currencies, gold and DSDs, convertibility, provisions of the articles relating to exchange rates and problems of recovery of capital movements. They were also asked to include, as far as possible, in the reports the texts of possible amendments to the statutes they considered necessary to implement their recommendations. Reactions to U.S. actions expressed by executive directors on August 16 illustrated the initial reactions of most monetary authorities. There was indeed an atmosphere of crisis. Many executive directors have pressed Mr. Dale for the intentions of the U.S.
authorities, particularly with respect to the exchange rate situation, which would occur immediately, and the import surcharge. Some felt that there was an urgent need to negotiate new values in the coming days. When the Executive Directors took up a draft decision that contained the Fund`s response to the U.S. communication, Dale said that U.S. authorities believed that U.S. measures were essential to create the dynamism of industrialized countries in the form of exchange rate and negotiation measures, which are essential to correct the imbalance in global payments. They therefore preferred that the Fund not make a decision at this stage.