IMF fundraises in developed economies to help poorest countries

IMF fundraises in developed economies to help poorest countries

Economy & Policy Fixed Income Loans Latin America Caribbean Coronavirus Haiti

The International Monetary Fund (IMF) announced on Friday it would provide debt relief for its poorest and most vulnerable members through the lender's Catastrophe Containment and Relief Trust (CCRT) to help them cope with the spreading health care crisis caused by the outbreak of COVID-19.  

The IMF changed the CCRT qualification criteria to enable it to provide debt service relief for up to two years. Specifically, countries with per capita income below the World Bank’s operational threshold for concessional support will now qualify. 

The IMF also said it is seeking to raise $1 billion to be used by the CCRT for focusing on the pandemic. Currently, the CCRT only has $200 million available for poor countries, it said. The UK responded with a pledge of £150 million ($184 million) on March 11.  

On Friday, the IMF welcomed the US Congress’ expedited approval to commit to strengthen the IMF’s resources. 

“The US decision to speed up approval of its substantial new contributions to the IMF is a powerful message to the international community and helps solidify the IMF’s $1 trillion lending capacity. It comes at a crucial time as the whole world fights COVID-19 and demand for IMF resources is high” said IMF Managing Director Kristalina Georgieva.  

Georgieva also announced on Friday that Haiti had requested financial support from the bank’s Rapid Credit Facility, adding that the IMF staff was “working expeditiously” to respond to this request and provide the rapid support necessary to help Haiti. The announcement did not provide information on the size of the request.