Sigapore - The International Monetary Fund has agreed to increase the influence of China, South Korea, Mexico and Turkey within the organization in acknowledgment of their rising economic strength, its chief said Friday.

The IMF's executive board agreed to increase the four countries' voting shares as part of a two-year program to reform the IMF's governance, Managing Director Rodrigo de Rato told journalists in Singapore in a satellite-linked press conference from Washington.

Voting rights of individual countries in the IMF are determined in part by the amount of money that they are to put toward the fund, called quotas.

"At present the relative quotas and voting shares of our members do not adequately reflect the greatly increased economic weight of major emerging market economies in the global economy," de Rato said, adding China, South Korea, Mexico and Turkey were "clearly underrepresented."

De Rato also said that while Asia accounted for about a quarter of the world's gross domestic product, its share of fund quotas was a third less by proportion _ with China's share of the global GDP 1.5 times its share of fund quotas and South Korea's portion of the world GDP twice its allocated fund quotas.

At present, major industrial nations such as the United States, Japan, Britain, Germany and France have single seats on the IMF's 24-member governing executive board, while a country like Brazil, South America's largest economy, shares a seat with eight other countries. The United States is the largest shareholder in the IMF.

De Rato said the agreement will be submitted to the IMF's board of governors for approval when the IMF convenes in Singapore in two weeks' time for its annual meeting. The decision signals recognition that power within the IMF, created at the end of World War II, no longer accurately reflects the relative economic strengths of its 184 member nations.

The IMF is expected to discuss other reforms at the multilateral body as well as consider macroeconomic issues in rapidly developing economies such as India and China.

The IMF's chief also said the Washington-based body believes that the level of the Chinese currency, the yuan, should reflect the strength of the Chinese economy.

A stronger yuan would help China achieve sustained economic growth, bolster domestic consumption and make investment more efficient, de Rato said.

De Rato also said some inflationary pressures are building in India, with the country having enjoyed above-trend growth of 8 percent in the last three years.

His comments come after the Reserve Bank of India said earlier this week the outlook for inflation is "clouded," prompting talk of a rate hike in October.

In July, the Indian central bank said it expected inflation in the fiscal year ending in March 2007 to average between 5 percent and 5.5 percent.

More broadly, de Rato said: "For Asia, with growth remaining strong, some modest rebalancing of growth is likely, as exports moderate with slowing global growth and domestic demand strengthens."

The region's business environment needs to become more attractive with more efficient financial integration and to attract more investment, he said.

The world economy needs to adjust to high oil prices and to reassess policies such as subsidies, de Rato also said.

That will also require better safety nets as well as social and labor reforms to help individuals cope with the changes, he said.