A London Based Digital Publication Covering Diplomatic & Business Activities Globally

Thursday, March 28, 2024

IMF to launch new form of aid

IMF to launch new form of aid
IMF to launch new form of aid

(Washington) – The International Monetary Fund (IMF) announced that it will launch a new tool to support governments in financial trouble — but one that involves no money — formalising a step it took last week for Greece.

Instead of providing cheap loans to member countries, the new IMF tool will serve as a good housekeeping seal of approval for a government’s reform program.

With that approval in hand governments would be more likely to be able to access other forms of financing from banks and bond markets, the IMF said in a statement.

“The new instrument is designed to help countries unlock financing from official and private donors and creditors,” the IMF said.

“It enables them to signal commitment to reforms and catalyse financing from other sources.” The IMF last week revived a rarely-used mechanism under which it approved a one-year loan to Greece but withheld the disbursement of funds until the country receives significant debt relief from its eurozone partners.

That had a similar effect as the new tool: allowing Greece to return to markets this week to issue three billion euros ($3.5bn) worth of five-year bonds, and removing a major roadblock in the negotiations with the euro area.

The IMF board this month approved the new non-financing Policy Coordination Instrument (PCI), which unlike traditional fund programs will not have any eligibility criteria, as long as the country is not delinquent in payments to the IMF.

Rather than providing loans in exchange for strict adherence to an agreed program of economic and financial reforms — with performance targets reviewed quarterly — the IMF will focus only on the government’s policy package.

Latest Posts

Latest Posts

Stay in touch

To be updated with all the latest news, offers and special announcements.

RELATED ARTICLES

UAE & Turkmenistan expand Economic ties

Turkmenistan's Berdimuhamedow urges UAE collaboration in gas field development....

Crown Prince Appreciates the World Governments Summit Team

The Crown Prince Appreciates the valuable efforts of the...

WTO Promotes Consensus

The final World Trade Organization General Council meeting before...

UK and Azerbaijan celebrate growing bilateral relations

UK PM Rishi Sunak congratulated President Ilham Aliyev on...

World Government Summit brings Global leaders to Dubai

The pre-summit day of the World Governments Summit (WGS)...

HH Shiekh Mohammed bin Rashid Meets Youth

Sheikh Mohammed bin Rashid Al Maktoum met with Arab...

Shiekh Hamdan Bin Zayed Honors Environmental Achievers

His Highness Sheikh Hamdan bin Zayed Al Nahyan, Ruler’s...

Princess Kate shares a Message after meeting HM the King

Prince William and Kate Middleton share a Children's Mental...

HM King of Sweden to visit Europe

King Frederik X of Denmark and Queen Mary will...