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Lending $268 billion to 93 countries since the start of the pandemic
September 14, 2022
11:06 am
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The International Monetary Fund confirmed that it is in the process of increasing emergency funding to countries affected by high food prices and shortages caused by the war in Ukraine, as 20 to 30 countries are in dire need of these supplies.
Fund manager Kristalina Georgieva said its executive board members were “very positive” about the proposed aid plan when they met informally on Monday, and she hoped they would approve it to allow the money to be quickly disbursed.
The plan, first reported by Archyde.com on Monday, would allow the IMF to provide additional, unconditional emergency financing to countries hit hard by the food crisis triggered by Russia’s war in Ukraine and global inflation in the wake of the COVID-19 pandemic.
“There is a sense of urgency so we must act,” Georgieva said at a conference hosted by the Center for Global Development. “What we are proposing is to increase the access of the most vulnerable countries to emergency financing for a year.”
She added that the changes would benefit low-income food-importing countries that have seen their costs skyrocket, or other countries such as Ukraine whose exports have been crippled by the war.
She stated that the program will be available to countries that do not already have a larger IMF program, and estimated that about 50 countries will be eligible, and it is expected that 20 to 30 will be the most in need.
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IMF spokesman Jerry Rice said the fund has loaned more than $268 billion to 93 countries since the start of the pandemic and is looking at “all options to enhance our toolkit, including helping countries affected by the food crisis.”
He added that the Fund has provided loans worth 27 billion dollars to 57 low-income countries, and continues to encourage its member states to “come to us early to obtain the required financial support.”
Informed sources said that the proposal discussed Monday would allow all member countries to borrow up to an additional 50 percent of their quota in the IMF under the Fund’s Rapid Financing Instrument, with low-income countries able to benefit from the Rapid Credit Facility.
Food prices – which have already fueled inflation – have soared around the world after the start of the Ukraine war due to supply route closures, sanctions and other trade restrictions.
However, a UN-brokered deal allowed for the resumption of grain exports from Ukrainian ports, which has facilitated trade flows and lower prices in the past few weeks.
Archyde.com
https://tinyurl.com/nhc6hhwt