The International Monetary Fund, IMF has responded to distress call from Nigeria and other poor countries that they cannot fight the corona virus pandemic without financial assistance of development partners.
As such the IMF has now responded to the clarion call by providing $1 trillion as loans to Nigerian and others to assist them fight the virus that has ravaged the world in the last five months.
The fund, had last week, released $3.4 billion loan to Nigerian to combat the novel virus.
Kristalina Georgieva, the fund’s managing director, said she has received many distress calls for help from poor nations, particularly in sub –sahara Africa.
The IMF boss spoke ahead the Fund’s virtual spring meeting coming up next week.
According to her “We have $1 trillion in lending capacity and are placing it at the service of our membership.
We are responding to an unprecedented number of calls for emergency financing—from over 90 countries so far.”
She stated that all bottlenecks are being removed to make sure countries in desperate need of support get it on time.
“Our Executive Board has just agreed to double access to our emergency facilities, which will allow us to meet the expected demand of about $100 billion in financing.
Lending programmes have already been approved at record speed—including for the Kyrgyz Republic, Rwanda, Madagascar, and Togo—with many more to come.
We are reviewing our tool kit to see how we might better use precautionary credit lines to encourage additional liquidity support, establish a short-term liquidity line, and help meet countries’ financing needs via other options—including the use of Special Drawing Rights (SDRs).”
Georgieva stated that highly indebted nations are not likely to get loan facility this time
“And where we might be unable to lend because a country’s debt is unsustainable, we will look for solutions that can unlock critical financing,” she said.
She said the fund is working with other development partners to provide debt relief for poor countries as well as restructure debt servicing moratorium, so that available fund could be channeled to more priorities such as education, health and infrastructure.
IMF has “revamped our Catastrophe Containment and Relief Trust to provide immediate debt relief to low-income countries affected by the crisis, thereby creating space for spending on urgent health needs rather than debt repayment.
We are now working with donors to increase the Centre for Cultural Resources and Training (CCRT) to $1.4 billion to extend the duration of the debt relief.
And together with the World Bank, we are calling for a standstill of debt service to official bilateral creditors for the world’s poorest countries. I am proud of the staff of the IMF for stepping up in this crisis.
And I look forward to the discussions during the Spring Meetings next week on what more we can do”, Georgieva said.
