IMF chief expects members to reach $100 bln target for shifting reserves to vulnerable countries

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WASHINGTON, Oct 13 (Businesshala) – International Monetary Fund Managing Director Kristalina Georgieva said on Wednesday that she expects advanced economies to reach their goal of transferring $100 billion of their newly created emergency reserves of $650 billion to countries in need. Will reach

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Georgieva told reporters that she was encouraged by the IMF’s executive board to consider a new Resilience and Stability Trust (RST), which would give rich countries their share of new special drawing rights compared to only low-income countries. will allow donations or loans to more countries in the Eligible for such help under the IMF’s Poverty Reduction and Growth Trust.

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The IMF chief said the fund is also taking measures to increase transparency regarding the use of any SDRs.

Georgieva said members widely supported the creation of the new RST trust during a nearly four-hour meeting of the executive board on Friday, where IMF staff answered questions about possible norms, the financial arrangements and the purpose of the new trust. lamps.

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“We want to be part of the solution policymakers have to make long-term change on the climate, but also beyond the climate,” she said.

“We were so encouraged that it resonated across the board, and some of our members, in strong positions, began to indicate interest in contributing to this new trust.”

Asked about reservations expressed by some critics that the new trust would overlap with the World Bank’s mandate, Georgieva said the fund was working closely with the Multilateral Development Bank as it developed the new trust.

In fact, Georgieva said that the IMF’s first presentation about the RST was to the World Bank’s board, and a large World Bank team participated in the presentation to the fund’s board.

German Finance Minister Olaf Scholz, in a statement prepared for Thursday’s meeting of the International Monetary and Financial Committee, a steering committee for the Fund, called for a “clear delineation” of actions between the Fund and institutions such as the World Bank, and said that Any new trust “must be carefully designed to avoid unintended consequences and drawbacks.”

He added that the new trust “should neither induce convenience purchases nor jeopardize the ability of members to repay it on regular fund programs.”

He also urged the fund to take advantage of the financial linkages of multilateral development banks, particularly in areas such as climate change and pandemic preparedness, which he said were mainly in their remit.

Reporting by Andrea Schallal and David Lauder; Editing by Andrea Ricci

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