The International Monetary Fund (IMF) Executive Board has approved a framework for a new round of bilateral borrowing by the IMF from Jan. 1, 2021.
According to a statement issued by the Fund in Washington D.C. on Tuesday and obtained from its website by News Agency of Nigeria, (NAN), the new framework will succeed the current Bilateral Borrowing Agreements (BBAs) currently in place through the end of December.
It added that the framework was broadly the same as that agreed in 2016 for the current BBAs.
“The new BBAs will have an initial term of three years through end-2023, which is extendable by one more year through end-2024.
“These new agreements will help maintain the IMF’s lending capacity of one trillion dollars for the next few years, ensuring its ability to respond to members need.”
The IMF said that the BBAs were its third line of defense after quotas and the New Arrangements to Borrow (NAB).
It also said that the board’s decision was part of a broader package on IMF resources and governance reform endorsed by the IMF membership during the 2019 Annual Meetings.
It said that this builds on the board’s January approval of a doubling of the NAB and guidance on quota reforms.
The new BBAs and the doubling of the NAB are expected to take effect on Jan. 1, 2021, subject to timely approvals by creditor member countries and their institutions.
“These are critical steps to ensure that the IMF can support its membership through the global pandemic now unfolding and beyond,” the statement reads. (NAN)