The International Monetary Fund (IMF) on Monday March 22 made another bid to throw its lot in to respond to the global coronavirus pandemic when its executive board approved further extensions to already temporary adjustments which it had made to its lending frameworks during the early months of the pandemic. This had been done in order to allow for adequate access by hard-hit countries to Fund financing through emergency instruments, namely the General Resources Account (GRA), and the Poverty Reduction and Growth Trust (PRGT). The Fund said in a release after the executive board had made its decision that the measures “reflect the unique circumstances created by the pandemic.”
In a release issued by its communications department, the Fund said that it will “ensure that member countries continue to be able to access IMF financing, through both IMF-supported programmes and emergency financing in case of urgent balance of payments needs.”
The extensions to countries in annual and cumulative access limits that apply to the Fund’s emergency financing limits will apply through 2021. Those extensions had been introduced last April and originally extended in October 2020. So far, 74 member countries, including 49 low-income countries have benefitted from emergency financing through these instruments.
Last week the Fund’s executive board also cleared an extension of the increase in the annual access limit to the IMF’s GRA, introduced in July 2020. The increase also extends through 2021. Additionally, it also approved an increase in both annual and cumulative access limits on concessional lending through the PRGT, through end-June 2021. “The increase in access to PRGT financing, recognizes that many low income countries that have been hard hit by the pandemic had already borrowed significantly from the IMF,” the media release says. It asserts that higher borrowing limits would “provide flexibility for poorer countries in the coming months to avoid having to request support through the Fund’s general resources on non-concessional terms.”
Meanwhile, the Fund says that its directors are looking forward to “a broader discussion of the Fund’s lending facilities for low-income countries (LICs) and how these can be financed as part of the forthcoming Review of Concessional Financing and Policies.”
