YALTA, Ukraine (Agencies) - Policy moves by the Chinese government to free the yuan from a dollar peg will help the Chinese currency rise, Dominique Strauss-Kahn, the head of the International Monetary Fund, said on Saturday.

""I am confident that the new policy of the Chinese authorities will lead to the revaluation of the yuan,"" Strauss-Kahn said during a conference in the Black Sea resort town.
Finance Ministers from the Group of Seven major industrialized nations will meet informally on the sidelines of an IMF meeting in Washington on October 8, which will focus on potential currency depreciations by some countries who may seek to increase exports.
China's policy of keeping the yuan artificially weak has drawn criticism that Beijing is maintaining an artificial advantage in international trade at cost of jobs in consumer countries.
Strauss Kahn warned against efforts by other countries to hide their own economic problems behind China's currency policy.
""This kind of policy is in their own interests. The revaluation of the renminbi should not be used (by other governments) as a curtain to hide problems in their own country. It is always easy to have scapegoats""
Meanwhile China on Thursday warned that a bill passed by the U.S. House enabling tariffs against currency-manipulating countries could damage ties between the world’s biggest economies.
----IMF reforms
Belgian Finance Minister Didier Reynders, whose country holds the 27-nation EU’s rotating presidency, said the bloc was ready to discuss the quota system that determines voting strength at the IMF’s board seats.
EU finance ministers Friday approved a proposal that would share with emerging nations two of the continent’s eight IMF executive director’s current 24 seats.
He spoke three days before a summit of Asian and European leaders in Brussels and ahead of the annual IMF meeting on October 8-10.
If the United States agrees to a swing of five percent in these quotas, favoring advanced emerging economies such as China or India, then Europe will consider rotating two of the nine seats it holds on the 24-seat IMF board with emerging countries. Reynders indicated the concession would only be negotiated if Washington dropped a demand to return the board to its statutory 20 seats by November 1, when the two-year IMF board is selected. Striking a deal with the U.S. will prove difficult because Washington, which controls 16.7 percent of the votes, can block a required majority for action of 85 percent. The U.S. would have to relinquish its ability to block majority decisions taken by old and new partners. The U.S. has made it clear that it does not intend to give up on this privilege. The extra four IMF seats, allocated to Argentina, Brazil, India and Rwanda, would have to be cut back of no agreement is reached before November 1.
The current IMF executive board representative and quota structure reflects post-World War II snapshot of the global economy. But given the rise of emerging nations such as China, India and Turkey in the last several decades, there are calls for fundamental restructuring of IMF’s governance.
Photo: Bundles of 100-yuan notes are stacked at a teller's station in a bank in Hefei, China, October 1, 2010. Beijing has refused to let its currency rise in value as quickly as the U.S. and other trade partners would like. (Photo: AFP)