The Executive Board of the International Monetary Fund (IMF) has approved a one-year extension of the 2012 Borrowing Agreements, noting that these agreements have played a key role in ensuring that the Fund has adequate resources to meet members’ potential needs in the event that tail risks were to materialise.
In a statement late Wednesday, the IMF said in 2012, a number of member countries committed to increasing IMF resources through bilateral borrowing agreements.
Following Executive Board approval of the modalities for the 2012 borrowing agreements, 35 agreements for a total of about US$441 billion (SDR 288 billion) have been approved by the Board, of which 32 agreements are now effective for a total of US$425 billion (SDR 277 billion).
“The 2012 Borrowing Agreements are designed as a second line of defence after quota and New Arrangements to Borrow (NAB) resources and have so far not been activated for use in financing operations,” said the IMF.
“Each agreement has an initial two-year term, and a maximum term of four years,” it added, noting that after this decision on 8 Sept., which followed consultations with lenders, the initial two-year term of the agreements will be extended by one year.