IMF approves immediate debt service relief for 25 eligible low-income countries

According to a statement issued late Wednesday by the Fund, a further four countries are expected to request such relief in the coming weeks.

The statement added, «The approval enables the disbursement of grants from the CCRT for repayment of total debt service falling due to the IMF over the next six months, with potential extensions, up to a maximum of full two years from 14th April 2020, subject to availability of sufficient grant resources.»

It went on to say that the initial relief provided to these countries amounts to US$213.4 million, noting that relief on debt service will free up scarce financial resources that now can be directed toward vital emergency medical and other relief efforts while these members combat the impact of the COVID-19 pandemic.

The IMF Managing Director Kristalina Georgieva has launched an urgent fundraising effort that would enable the CCRT to provide relief on debt service for a full two years, while leaving the CCRT adequately funded for future needs. This will require a commitment of about US$1.4 billion.

In March, the Executive Board of IMF adopted a set of reforms to its Catastrophe Containment and Relief Trust to enable the Fund to provide immediate debt service relief for its poorest and most vulnerable members during the current pandemic.

The CCRT enables the IMF to deliver grants to eligible low-income countries to cover their IMF debt service obligations in the wake of catastrophic natural disasters and during major global public health emergencies.