Kristalina Georgieva has called on world leaders to close a $1.2-billion funding gap facing the IMF’s main instrument for interest-free lending to poor countries amid deepening global disparities.
Speaking on Thursday at a summit of some 40 leaders in Paris, the IMF’s managing director said more subsidy resources were needed to make up the difference between the market interest rates received by lenders and the below-market rates the Fund is committed to offering the most vulnerable borrowers through the Poverty Reduction and Growth Trust.
“My appeal at this summit is to close this gap.”
The world was marked by increasing disparities over capital access, climate change and financial capacity, Georgieva said. The way the IMF implements its mandate must become more comprehensive to take account of the resilience of people, society and the planet.
The managing director said the IMF has reached a target to re-channel the equivalent of $100 billion of Special Drawing Rights, the Fund’s international reserve asset, from richer nations to poorer ones. But Georgieva said she wanted re-channeling to go further.
“Now, we must lift our ambition.”
