The International Monetary Fund (IMF) is ready to mobilise its US$1-trillion lending capacity to help nations counter the coronavirus outbreak, with Managing Director Kristalina Georgieva calling for global coordination on monetary, fiscal and regulatory support.
Georgieva reiterated in a blog post Monday that the fund has US$50 billion in flexible and rapid-disbursing emergency funds for developing nations, with as much as US$10 billion available at zero interest rates.
The fund already has 40 ongoing loan arrangements with combined commitments of US$200 billion that can quickly provide crisis financing, she indicated. There are about 20 more countries interested in support, Georgieva said.
The fund also has about US$400 million in its Catastrophe Containment and Relief Trust to help poor countries with debt relief. With the help of donations, like US$195 million recently from the UK, the IMF hopes to boost that to US$1 billion, she pointed.
“As the virus spreads, the case for a coordinated and synchronised global fiscal stimulus is becoming stronger by the hour,” Georgieva stressed. “During the global financial crisis, for example, fiscal stimulus by the G-20 amounted to about two percent of GDP, or over US$900 billion in today’s money, in 2009 alone. So, there is a lot more work to do.”
Georgieva added that the IMF “stands ready to mobilise its US$1 trillion lending capacity to help our membership.” She praised the swap lines announced by central banks on Sunday, saying that going forward there may be a need for swap lines to emerging-market economies.
The comments come after Georgieva said earlier this month that the global economic outlook has shifted to “more dire scenarios” and that it’s still difficult to predict the economic impact of the virus. Meanwhile, the fund on Friday ordered all staff at its Washington headquarters to work from home after an employee was diagnosed with the virus.