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IMF aims todouble resourcesIMF financesIMF encourages stimulus Watch interview with ManagingDirectorIMF calls for action on banksIMF's world growth forecastIMF urges G-20 actionGold in the IMF Video: Strauss-Kahn thanksJapan
Strauss-Kahn (left) shakes hands after thesigning ceremony with Shoichi Nakagawa,Japan's Minister of Finance (photo: IMF)
Injection of funds by Japan will strengthen IMF'sability to tackle global crisisIMF seeking to double funding to $500 billionExecutive Board considering other ways toincrease resources
IMF
 Survey Magazine: In the News
IMF LENDING
IMF Signs $100 BillionBorrowing Agreement WithJapan
IMF Survey onlineFebruary 13, 2009
apanhasprovided the IMF with an additional $100 billionto bolster the Fund's lendable resources duringthe current global economic and financial crisis.
Managing Director Dominique Strauss-Kahn and ShoichiNakagawa, Minister of Finance of Japan, signed theterms of Japan's $100 billion commitment on February13 under a borrowing agreement designed totemporarily supplement the Fund's financial resources.The IMF said the additional funds will bolster its capacityto provide timely and effective balance of paymentsassistance to its 185 member governments.
Crisis-lending
The IMF has so far committed around $48 billion in lending to a number of economiesaffected by the crisis, including Belarus, Hungary, Iceland, Latvia, Pakistan, Serbia, andUkraine. It announced a precautionary loan for El Salvador last month and an IMF team hasalso been in negotiations with Turkey.The IMF expects global growth to grind to a virtual halt in 2009, with the advancedeconomies in a recession. The economic crisis has caused global trade and capital flows toplummet.The formal signing of the agreement in Rome, Italy, follows the IMF Executive Board'sapproval of the terms on February 12, 2009. Taro Aso, Japanese Prime Minister, announcedin November 2008 that Japan would be willing to provide supplemental funding to the IMF,to help overcome the current global crisis (seePress Release No. 08/284).
 
Apart from the new money from Japan, the IMF has around $200 billion inlendableresources.Managing Director Dominique Strauss-Kahn wants to boost the IMF's lendable resources toaround $500 billion, both as a precaution in case the crisis gets worse and as reassurancethat the IMF can meet any eventuality. The IMF's Executive Board is considering a number of ways to strengthen the Fund's resources, including additional borrowing from official sources.
Single-largest commitment
Strauss-Kahn, on a trip to Rome to attend a meeting of ministers from the Group of Seven(G-7) advanced economies, said the IMF was deeply grateful for the Japanese government'ssupport [seevideo reaction]."This commitment is the single-largest supplemental financing contribution by an IMFmember country ever, and it clearly demonstrates Japan's continuing commitment to amultilateral approach to global economic and financial challenges. We are hopeful that othercountries will join Japan in providing their support to the Fund's efforts."Japan's total commitment is equivalent to about 31 percent of total Fund quotas, the capitalmembers put into the IMF when joining.The initial period of the commitment by Japan is for one year, and may be extended by theIMF for up to a total of five years if warranted by the Fund's liquidity situation and its actualand prospective borrowing needs. Each drawing will carry interest at the interest rate on theIMF'sSpecial Drawing Rights, which is currently 0.62 percent.Comments on this article should be sent to
imfsurvey@imf.org
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