On Monday, April 13, 2020, the International Monetary Fund (IMF) announced that it would release its immediate debt relief funds to 25 member countries under its Catastrophe Containment and Relief Trust (CCRT) to strengthen financial resources and fighting the coronavirus pandemic of the countries.
An IMF spokeswoman said, nearly $215 million of the total grants would be used for the first 25 countries over the next six months, with extensions possible up to two years and pushing to raise the relief amount to $1.4 billion.
IMF’s Coronavirus Relief Funds
IMF Managing Director, Kristalina Georgieva said the executive board of the organization approved the relief funds on Monday and the first batch of 25 poorer countries would be receiving the grants to cover their debt service obligations for an initial six months.
She also said the CCRT had about $500 million in resources on hand, including the contribution of $185 million from Britain, $100 million from Japan, and undisclosed amounts from China, the Netherlands, and others.
Georgieva explained in a statement, “This provides grants to our poorest and most vulnerable members to cover their IMF debt obligations for an initial phase over the next six months and will help them channel more of their scarce financial resources towards vital emergency medical and other relief efforts.” Moreover, she urged other donor countries to contribute more to the CCRT funds so that it could provide additional debt service relief for a full two years to its poorest member countries.
The IMF in March had approved changes that could allow the extension of CCRT funds up to two years of debt service relief to the poorest members to strengthen their responses to the outbreak of COVID-19, the respiratory illness caused by the novel coronavirus. The changes had enabled several countries to receive financial aids even if the outbreak had not yet caused a significant impact.
CCRT Aids to Mostly African Nations
The IMF declared that the first countries that would receive debt service relief from the CCRT are Afghanistan, Benin, Burkina Faso, Central African Republic, Chad, Comoros, the Democratic Republic of Congo, Gambia, Guinea, Guinea-Bissau, Haiti, Liberia, Madagascar, Malawi, Mali, Mozambique, Nepal, Niger, Rwanda, São Tomé and Príncipe, Sierra Leone, Solomon Islands, Tajikistan, Togo, and Yemen,
Eric LeCompte, executive director of a non-profit group, Jubilee USA Network, said the IMF’s sponsored grants would help the poorest members, including the Central African Republic, which has only three critical-care unit beds for a population of 5 million. He added, “It’s a great start, but we need more donors to be able to offer this relief.”
LeCompte suggested that the IMF should also consider selling some of its gold reserves, which is currently worth an estimated $140 billion, as it had done in past crises of helping in natural calamities relief events. However, an IMF spokesman said the organization was looking to raise more funds, but “another sale of gold reserves is not currently on the table.”
Earlier, the funds of CCRT had been used in the devastating earthquake for Haiti in 2010 and also was used to provide relief to countries affected by the 2014 Ebola outbreak. According to a Reuters tally, globally the virus infection cases reached 1.8 million people and 115,242 deaths have been reported worldwide.
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