IMF Briefing on COVID-19 emergency lending, Lebanon, Zambia, and Cameroon
The IMF continues to move at a record speed in trying to support and help its member countries deal with the COVID-19 crisis. The Spokesperson Gerry Rice told reporters during the bi-weekly virtual press briefing Thursday in Washington, D.C.
The IMF has $1 trillion war chest, and the its Executive Board has approved financing to 69 countries totaling almost $25 billion thus far.
“The IMF continues to move at a record speed in trying to support and help our member countries deal with this crisis. We have deployed, as this crisis unfolds, about $250 billion across all our lending facilities,” said Rice.
On specific country cases, multiple reporters raised questions on Lebanon, asking essentially how the different numbers for losses in the country’s financial system impacting the discussions between the IMF and Lebanon regarding a possible program of support. Rice reiterated that the discussions are ongoing. He added that the scale and the size of a possible program will be the decision of the executive board, as is always the case.
In terms of where the negotiation stands, he said:
“We are not yet at a stage to discuss specific measures under a possible Fund program to support Lebanon.”
On the substance, he stressed the ownership of the reform effort by the Lebanese government.
“The discussions remain focused on the government’s plan, I have said that here before, the government’s diagnostic and the reforms proposed. Again, these are complex issues, which require consensus on how to address the difficult challenges in an effective and equitable manner. Comprehensive reforms in many areas are needed and these require ownership and consensus from society at large.”
Turning to Africa, as a follow-up from the Zambian finance minister’s comment last week, Rice confirmed the timing of the upcoming consultation with Zambia.
“I can confirm that fund staff will be holding virtual consultations with the Zambian authorities regarding their request for emergency financing in the week beginning June 22nd.”
In the face of the COVID-19 pandemic, the Zambian authorities have requested emergency assistance from the IMF. This comes in addition to an earlier request from Zambia for Fund support for their broader economic reform program aimed at restoring economic stability and fiscal as well as debt sustainability while increasing growth and fighting poverty.
Rice also said the Zambian authorities are aware that steps would need to be taken to restore debt sustainability. In this regard, the IMF staff notes the government's commitment to restore debt sustainability through fiscal policy adjustment and debt management in line with the finance minister's statement back in February.
Staying in Africa, Rice to summarize the restrictions and the specific purposes of the IMF emergency loans, especially in the context of the negotiation with Cameroon.
He said IMF emergency funds are aimed at supporting governments efforts to mitigate the impact of the COVID-19 pandemic and the terms of trade shocks. These funds are subject to the strict application of the budgetary procedures and controls provided by Cameroon's national law on the code of transparency and good governance in public finance management. And the law on the financial regime for the government and all other public entities all adopted in July 2018.
“We are working on measures to promote transparency, accountability and ensure that IMF resources are used for their intended purposes,” he added.
A full version of the presser may be found HERE.
Transcript will also be posted shortly.