The Executive Board of the International Monetary Fund (IMF) said it has approved an improvement in the access to emergency financing to help countries face the challenges stemming from the coronavirus crisis.
In a statement issued on July 22, IMF announced that “on July 13, the Executive Board of the International Monetary Fund (IMF) approved a temporary increase in the annual limits on overall access to resources in the General Resources Account and the Poverty Reduction and Growth Trust,” the statement read. This means countries could temporarily be granted higher financing than the initial limit.
“The severe impact of the COVID-19 pandemic on global economic conditions has resulted in an unprecedented number of member countries seeking financial support from the IMF […] Given the unique circumstances created by the pandemic, the IMF’s Executive Board approved temporary increases in these annual access limits, to remain in effect through April 6, 2021,” the IMF said.
Observers have recently called on the IMF to increase its support to the poorest countries, particularly in Africa, where governments have limited capacity to respond to the pandemic. In late June 2020, the Fund’s Managing Director, Kristalina Georgieva, invited countries in a position to do so to allow the institution to issue an additional $1 trillion in Special Drawing Rights (SDRs).
Let’s note that the IMF Board also approved the temporary suspension of the limit on the number of disbursements under the Rapid Credit Facility (RCF) through April 6, 2021. “This allows emergency financing to the IMF’s poorest member countries to be provided more frequently over a year, provided that the combined amounts of support provided under the RCF does not exceed the annual limit on access under this facility,” IMF explained.