Broad Appeal to IMF for Extra Support for Poorer Countries
Poorer countries that are still struggling with the corona pandemic and its economic effects urgently need additional financial support.
This is the opinion of sixteen civil society organizations that are urging the International Monetary Fund (IMF) to release 2.5 trillion dollars, converted into more than 2300 billion euros, in extra emergency reserves.
In an open letter, the organizations, including Caritas Africa, point out that the problems in many poorer countries have only worsened recently. This is due to the sharp rise in energy and food prices worldwide due to the war in Ukraine.
Last year, the IMF increased the emergency reserves of member countries by $650 billion. According to the organizations, this has helped many countries buy vaccines and limit the damage to their economies. But more help would be needed. This is partly because a large part of last year’s money would have gone to richer countries that did not need it at all.
The latter argument also immediately makes a new similar action by the IMF very difficult. If the IMF were to deploy emergency reserves again, all IMF members would benefit, including Russia, China, and Iran. Other countries would probably oppose it. The United States has already indicated that it will go to great lengths to prevent Russia from monetizing previously committed reserves from the IMF.