IMF: A plan to increase emergency supplies to absorb food shocks

The International Monetary Fund has confirmed that it is increasing emergency funding to countries affected by high food prices and shortages caused by the war in Ukraine, as 20 to 30 countries are in dire need of these supplies.
Fund manager Kristalina Georgieva said members of her board of directors were “very positive” about the proposed aid plan when they met informally on Monday, and hoped they would approve it to allow for a quick payout of the money.
The plan, first reported by Reuters on Monday, would allow the IMF to provide additional unconditional emergency funding to countries hard hit by the food crisis triggered by the Russian war in Ukraine and global inflation in the wake of the COVID-19 pandemic.
“There is a sense of urgency, so we need to take action,” Georgieva said at a conference hosted by the Center for Global Development. “What we propose is to increase the access of the most vulnerable countries to emergency funding for one year.”
He added that the changes would benefit low-income food importing countries that have seen their costs skyrocket, or other countries like Ukraine whose exports have been paralyzed by the war.
He said the program will be available to countries that do not already have a larger IMF program and estimated that around 50 countries will be eligible and 20 to 30 are expected to be the most in need.

Quick funding tool

IMF spokesman Jerry Rice said the fund has lent more than $ 268 billion to 93 countries since the start of the pandemic and is examining “all options for improving our toolkit, including helping countries hit by the food crisis.” .
He added that the Fund has provided loans worth $ 27 billion to 57 low-income countries and continues to encourage its member states to “come to us soon to get the financial support they need.”
Informed sources said the proposal discussed on Monday would allow all member countries to borrow up to an additional 50% of their stake in the IMF under the Fund’s Quick Financing Facility, with low-income countries able to benefit from the Rapid Credit Facility.
Food prices – which have already fueled inflation – have soared around the world since the start of the war in Ukraine due to the closure of supply routes, sanctions and other trade restrictions.
However, a UN-brokered deal has allowed grain exports to resume from Ukrainian ports, which has eased trade flows and lowered prices in recent weeks.
Reuters

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