Senior monetary officials of the five main industrial nations reached broad agreement last night in Kronberg, West Germany, on a 50 percent increase in funds available to the International Monetary Fund, European monetary sources said.
But the sources said negotiations will continue on how to expand IMF quotas, or the contributions members make to the fund, and on a possible tripling of the pool of money the five make available under their General Arrangement to Borrow .
One source said Treasury Secretary Donald Regan held out his final approval of the 50 percent increase, arguing that the administration may find it hard to win congressional approval for more than a 40 percent increase.
The United States had been reluctant to raise its IMF contribution by more than 25 percent.
Lamberto Dini, who was chairman of the meeting, told reporters that IMF quotas were likely to be increased from $66 billion to between $93 and $109 billion.
The IMF board will review the situation before Christmas, and ministers or other officials from the main industrial nations -- known as the Group of Five -- may meet again next month to discuss advancing a meeting of the IMF's decision-making Interim Committee to February from April.
Negotiations on improving IMF resources have been speeded up because of fears that the continuing recession may cause a financial crisis following severe debt problems in Brazil, Mexico and Argentina.
Finance ministers of the five leading industrial nations said that they see signs of global economic recovery but reacted cautiously to Treasury Secretary Donald Regan's ideas to reform the international monetary system.
The finance chiefs, who held private talks in a 19th Century castle converted into a hotel in the wooded hills outside Frankfurt, were the first to hear Regan's ideas for an overhaul of the monetary system to coordinate aid to near-bankrupt nations such as Brazil, Mexico and Poland.
"They reacted with caution and curiosity," Regan said. "I was encouraged to go away and come up with more specific plans."
He said he wanted "a more concerted effort" by the industrialized nations to control and assist the failing economies of developing nations.
West German Finance Minister Gerhard Stoltenberg told a news conference that he and the representatives of Britain, France, Japan and the United States are worried about the economic recession and problems of unemployment and growing protectionism.
"But we see some signs of gradual recovery in the world economy," Stoltenberg said, citing the fall in the rate of inflation and interest rates.
Regan's ideas include stabilizing exchange rates and possibly holding a worldwide conference.
Regan's plans, which he called a "personal initiative," also were seen as a hint that the United States is preparing to assume a leading role in bolstering the IMF to cope with the economic crisis.