💎 Fed’s first rate cut since 2020 set to trigger market. Find undervalued gems with Fair ValueSee Undervalued Stocks

FACTBOX-Global lenders IMF give aid in financial crisis

Published 11/20/2008, 06:57 AM
Updated 11/20/2008, 07:00 AM

Nov 20 (Reuters) - Iceland is set to receive financial aid of more than $10 billion from an International Monetary Fund-led package to rebuild its shattered financial system.

Below are details of some of the IMF's lending packages and current funding:

RECENT RESCUE PACKAGES:

* ARMENIA:

-- The IMF approved a three-year, $13.6 million loan programme to support its economy up to 2011. It allows Armenia to withdraw $1.9 million from the fund immediately.

* BELARUS:

-- Belarus is seeking a $2 billion loan in what officials have said was a "precautionary" measure against the impact of the global financial crisis. The IMF has put conditions on the issuance of any loan for Belarus, the country said last week, adding that the demands can be met.

* HUNGARY:

-- The IMF, the EU and World Bank agreed to a $25.1 billion economic rescue package for Hungary in the biggest loan for an emerging market economy since the global crisis began.

-- Hungary turned to the IMF for help in order to shore up its forint currency and markets and shield the economy from the global financial crisis.

-- The package, also taking into account Hungary's FX reserves of about 17 billion euros ($21.6 billion), was more than sufficient to cover Hungary's short-term financing need of around 32 billion euros in the next 12 months.

-- The IMF help came with conditions. It has forced the government to make additional spending cuts, including a reduction in social spending and public sector wages.

* ICELAND:

-- The IMF approved a $2.1 billion loan as part of $10.2 billion package on Wednesday, the cornerstone of international efforts to rescue Iceland.

-- Iceland said that on top of the IMF money, it would also receive $3 billion from Denmark, Finland, Norway, Sweden, Russia and Poland. The Faroe Islands will chip in with $50 million. A further Nordic $2.5 billion loan to Iceland would be split roughly between Sweden, Finland, Norway and Denmark. -- Iceland can immediately draw about $827 million from the two-year, IMF stand-by arrangement.

-- The programme demands that Iceland maintain an appropriately tight monetary policy with restrictions on capital outflow.

* PAKISTAN:

-- Pakistan agreed at the weekend with the IMF on a $7.6 billion emergency loan to stave off a balance of payments crisis and pave the way for a broader economic rescue plan.

-- The IMF said that the credit under the emergency funding would be tied to economic reforms, including higher official interest rates, tighter fiscal policies and a well-funded social safety net to protect the poor.

* SERBIA:

-- Serbia said last week it had agreed a 15-month stand-by programme with the IMF to help maintain macroeconomic stability.

-- The agreement includes a 2009 fiscal deficit goal of 1.5 percent of gross domestic product, down from 2.7 percent of GDP in 2008.

-- Serbia's dinar currency and hard currency reserves had slumped in the last month, driving it into talks with the Fund.

* SEYCHELLES:

-- IMF agreed last week on a two-year $26-million rescue package for the deeply indebted Seychelles economy.

-- Initially the country will receive $9.1 million as it struggles with a foreign debt previously valued at $800 million.

-- The package has been extended to support the economic reforms initiated by the government and the disbursement of the funds will be subject to performance.

* TURKEY:

-- Turkey is set to agree to a precautionary stand-by deal with the IMF for $20-40 billion in funds to weather the financial crisis.

-- Turkey and the IMF have been locked in negotiations for fresh funding after the country's $10 billion standby deal expired in May. IMF Managing Director Dominique Strauss-Kahn said that a package was close.

-- Economists have said that Turkey's $74 billion foreign exchange reserves were not a large enough buffer given the current account deficit is seen rising to $50.4 billion in 2009 and the funding need of the private sector is estimated at around $90 billion.

* UKRAINE:

-- The IMF approved a $16.5 billion loan package to help Ukraine withstand the financial crisis on Nov. 6. Ukraine received its first tranche worth $4.5 billion four days later.

* IMF FUNDING:

-- As of August 28, the fund had $201 billion in loanable funds. It had 18.3 billion loaned out under a variety of programmes to 65 countries.

-- Following the G20 summit in Washington, there was no fresh money for the IMF beyond a unilateral Japanese offer for a $100 billion loan. Saudi Arabia, intensely lobbied by British Prime Minister Gordon Brown to use its oil wealth to augment the Fund, pointedly said that it did not come to pay the bills.

-- Russia said on Thursday it will transfer $1 billion to the IMF to help finance rescue packages.

(Writing by Carl Bagh and David Cutler, Editorial Reference Units in Bangalore and London; Editing by Victoria Main)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.