April 8 (Reuters) - * IMF could turn to markets to raise additional resources
* Step may be useful in times of global market stress
* Well-funded IMF important for global confidence
WASHINGTON, April 7 (Reuters) - The International Monetary Fund said on Thursday it was worth exploring ways that the global institution could borrow from financial markets at short notice to raise additional funding for its lending programs.
In a paper that looks at progress by the Group of 20 major economies in reforming the global monetary system, the Fund said building confidence in the IMF's ability to respond to crises may warrant looking at alternative ways of fund-raising, including turning to markets.
The G20 meets in Washington next week before semi-annual meetings of the IMF and World Bank where changes to the global monetary system will be discussed by finance ministers.
"A more secure and flexible global safety net might require mobilization of additional resources," the IMF said.
"This could have the added advantage of offering a relative safe haven asset during times of global market stress," it added.
The IMF boosted its resources in 2009-10 by turning to member countries for loans or by raising members' subscriptions through so-called quota increases. But the IMF paper noted that the process took time and may not always be politically feasible.
The IMF's largest contributors are facing rising public debts and slashing budgets at home to try to balance their budgets, making it politically difficult to make the argument to voters to lend to international financial institutions.
The IMF was called on recently to provide rescue loans alongside the European Union to Ireland and Greece as they faced market pressures to fix problems in their economies.
On Wednesday, Portugal indicated it was next to ask for financial help after its borrowing costs rose to unsustainable levels.
NEW ROLE FOR SDR
Among issues being explored to update the global monetary system is whether or not to include the Chinese renminbi in a basket of currencies that make up the IMF's special drawing rights -- an international reserve asset of the IMF.
The basket is currently made up of the dollar, euro, pound sterling and the yen. Created in 1969, it does not reflect the rising importance of China.
One of the biggest obstacles to the SDR playing a bigger role in the global financial system was technical challenges and a "great deal of consensus-building and policy coordination," the IMF report said.
The report said most of the ideas being considered to remake the global monetary system would require more collaboration among countries. In addition, some proposals would take time to implement, the report said, suggesting it could be a while before a new monetary system is rolled out. (Reporting by Lesley Wroughton; Editing by Kim Coghill)