The IMF is working at an “unprecedented” pace to provide emergency support financing to the global economy with a particular focus on Africa, spokesman Gerry Rice said Thursday (June 4) in Washington.
Over $10 billion in financing has been disbursed to Sub-Saharan African countries since the outbreak of Covid-19 pandemic Rice said. That is roughly 10-times the average annual support from the IMF and an indication of the need for help.
“The IMF is providing emergency financing assistance on what I would characterize as an unprecedented scale. So what does that mean? As of June 3rd yesterday, between 35 and 40 sub-Saharan African countries have made a request for emergency assistance from the IMF. And 27 countries so far have received financing from the fund. They have received it for a total of about US 10 billion dollars again already disbursed and without IMF traditional conditionality.”
“More is planned in the coming weeks. So this 10 billion number that I just gave, this is actually about 10 times more than what we have been disbursing to the region on average on an annual basis.”
The IMF also supports moves by India to shore up its economy in the current crisis, Rice said at the virtual news conference.
“The priority continues to be swift implementation of this response effort to the crisis. In particular, although medium term fiscal consolidation remains important, further fiscal stimulus can be deployed as needed to support the poor. And given the sharp slowdown in domestic and global activity, there may be scope for additional monetary easing as well to support growth and financial stability may apply.”
Moves by the ECB to expand and extend financing for EU member states have the support of the IMF, Rice announced.
“The IMF staff welcomes the ECB decision to provide further liquidity support by increasing the size and duration of its pandemic emergency purchase program and its commitment to maintain a strong, accommodative stance until the ECB is medium term inflation objective is met.”
And the IMF urges that countries should avoid putting restrictions on global trade in food and medical supplies in the face of the pandemic, Rice said.
He pointed to a pledge by major economies for a 1-year moratorium on new trade restrictions in the wake of the 2008 Global Financial Crisis as a positive example of bold leadership.
“Today, more than ever, the global economy would benefit from a more open, stable, transparent, rules-based trade system. On the particular questions, we have in fact raised our concerns over supply disruptions from the use of export restrictions and other actions that limit trade of key medical supplies and food.”
For a full transcript of the briefing: IMF.org