The Corona Virus pandemic is placing growing strains on emerging market economies, however the International Monetary Fund has adequate resources to meet their wants for now, IMF officers mentioned on Wednesday.
The world lender is “fairly a bit away” from exhausting its $1 trillion in whole lending capability and is working to determine new sources of funding and liquidity for member international locations, the officers mentioned during a convention name with reporters.
More than 80 member international locations, principally emerging markets, have already requested some $20 billion in emergency zero and low-interest loans from the IMF, they mentioned, and IMF workers have been working to course of these requests as shortly as attainable.
“We see the disaster shifting to emerging markets. Low-income international locations are actually all seeing the pickup in an infection charges that we have seen in China and the superior economies,” mentioned one official. Funding wants have been better in a few of these economies due to vital capital outflows and a pointy drop in commodities costs, the official added.
The virus has contaminated greater than 878,000 folks and killed 43,412 all over the world.
In addition to current applications, the IMF is trying at reviving a proposal for a short-term liquidity line that was developed a number of years in the past, and could possibly be shortly applied if accepted by members, the officers mentioned.
There was additionally dialogue concerning the allocation of Special Drawing Rights, the forex of the IMF, a lot as was carried out in 2009, a transfer that may enhance funding obtainable for emerging market international locations, they mentioned, however that may take longer to implement.
While deeming itself vital to serving to international locations reply to the virus, the IMF couldn’t deviate from its basic ideas calling for debt to stay sustainable, mentioned one of many officers.
The officers mentioned there was broad support for a joint proposal by the IMF and the World Bank calling on official bilateral collectors to droop debt service funds – also called a standstill – for international locations that wanted assist during the present disaster.
That didn’t imply the IMF was urgent for a broader spherical of debt forgiveness, mentioned one of many officers.
