|The IMF is using all its instruments to the fullest to help members combat the crisis.||The IMF is putting all its resources in the service of the global fight against the pandemic and its economic, social, and financial repercussions, in close cooperation with other international financial institutions and development partners.|
To this end, the IMF is deploying its flexible emergency response toolkit—the Rapid Financing Instrument (RFI) and the Rapid Credit Facility (RCF)—to quickly help countries with urgent balance of payments needs as a result of the crisis. The RFI is available to all member countries, while the concessional RCF provides zero interest loans to PRGT-eligible members. Both provide assistance without the need for a fully fleshed out economic program. As per April 13, the IMF has received 74 such requests for emergency financing, more requests are expected in the coming weeks. The IMF has also temporarily doubled the amounts available to countries under the emergency response facilities in light of the pandemic.
The IMF’s Catastrophe Containment and Relief Trust (CCRT) can provide grants to the poorest countries to pay off debt service to the IMF, thus freeing up resources for containment and mitigation of the pandemic. Earlier this week, the IMF Executive Board approved relief for 25 countries on obligations falling due until mid-October. We are working closely with bilateral donors to further enlarge the CCRT’s resources and extend the duration of this relief.
Emergency financing can pave the way for new IMF-supported programs with larger loans, drawing on the IMF’s $1 trillion lending capacity. At this juncture the IMF has 39 ongoing arrangements—both disbursing and precautionary— with combined commitments of about $160 billion. Augmenting these arrangements where program implementation is on-track is another option for providing financing rapidly. Moreover, the IMF is exploring options to offer members with very strong policies a short-term liquidity line, with a view to granting predictable and renewable access to IMF resources.
Beyond lending, the IMF is helping its members assess the macroeconomic implications of the outbreak. It provides policy advice on measures to fight the crisis and is reprioritizing its capacity development program to this end. Moreover, the IMF will continue to play its role at the core of the global financial safety net, facilitating and coordinating support from other International Financial Institutions, Regional Financing Arrangements, and bilateral donors. The IMF will also explore further options for creditor coordination in order to facilitate comprehensive and fair debt restructuring and restore debt sustainability.
|While combatting the pandemic’s impact takes precedence for now, other policy priorities remain on the agenda.||Beyond the immediate efforts to fight the pandemic and its impact, the IMF will continue to work toward a more resilient and sustainable global economy. At this juncture, the IMF is prioritizing its work to help its members respond to the crisis. However, key challenges, such as containing the economic and financial repercussions of climate change, combatting debt vulnerabilities, aiding states in fragile situations, and supporting the modernization of the rules-based global trade system, will remain high on the IMF’s agenda.|