Journal Issue

Aftermath of terrorist attacks: World Bank and IMF will not hold Annual Meetings as scheduled

International Monetary Fund. External Relations Dept.
Published Date:
January 2001
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Following devastating terrorist attacks on the World Trade Center in New York City and the Pentagon outside Washington, IMF Managing Director Horst Köhler and World Bank President James Wolfenshon announced in a joint statement that the World Bank Group and the IMF would not hold their Annual Meetings scheduled for September 29-30. The decision was taken, according to the joint statment, “out of deepest respect and sympathy for the families of all those touched by the horrific events of last Tuesday, and in order to dedicate law enforcement personnel fully to the extraordinary and immediate priorities at hand” (IMF News Brief No. 01/89, September 17).

In an earlier statement issued on September 12, Köhler said: “I have assured the membership that the IMF is closely monitroing the situation, and stands ready to assist its member countries as appropriate. Our present assessment is that, despite the scale of the human tragedy, these terrible events would have only a limited impact on the international monetary and financial system.” (IMF News Brief, No. 01/88, September 12).

Statements in Europe

In Rome, the Italian Treasury, the current president of the Group of Seven, issued a statement on September 12 on behalf of the Group’s finance ministers and central bank governors emphasizing their commitment “to ensuring that this tragedy will not be compounded by disruption to the global economy.”

The ministers of economies and finance of the European Union, the European Central Bank, and the central bank governors of the European Union and European Commission, issued a joint statement in Brussels on September 12, pledging to take “all necessary measures…to ensure the proper functioning of markets and the stability of the financial system.”

Swap agreement

In a further move to stabilize the system, on September 13, the U.S. Federal Reserve Board announced that it and the European Central Bank (ECB) had agreed on a swap agreement “in order to facilitate the functioning of financial markets and provide liquidity in dollars.” Under the agreement, the ECB would be eligible to draw up to $50 billion, receiving dollar deposits at the Federal Reserve Bank of New York. In exchange, the New York Federal Reserve Bank would receive euro deposits of an equivalent amount at the ECB.

The statement said that the ECB would make these dollar deposits available to national central banks of the Eurosystem, which will use them to help meet dollar liquidity needs of European banks, whose U.S. operations had been affected by the disturbances in the United States. The swap line will expire in 30 days.

The next issue of the IMFSurvey will be published on October 8.

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