2016 Handbook of IMF Facilities for Low-Income Countries

Policy Papers ◽  
2016 ◽  
Vol 16 ◽  
Author(s):  
Keyword(s):  
Low Income ◽  
Poverty Reduction ◽  
Safety Net ◽  
Low Income Countries ◽  
Legal Authority ◽  
Executive Board ◽  
Poverty Reduction Strategy ◽  
Reference Tool ◽  
Financial Safety Net ◽  
Comprehensive Reference

This Handbook provides guidance to staff on the financial and non-financial facilities for low-income countries (LICs), defined here as all countries eligible to obtain concessional financing from the Fund. It updates the previous version of the Handbook that was published in February 2015 (IMF, 2015) by incorporating modifications resulting from Board papers and related decisions since that time, including the reform of the Fund policy on Poverty Reduction Strategy in Fund engagement with low-income countries, Financing for Development—Enhancing the Financial Safety net for Developing Countries, Proposal for Catastrophe Containment and Relief Trust, the Review of Eligibility to Use the Fund’s Facilities for Concessional Financing, and the 14th General Review of Quotas.1 Designed as a comprehensive reference tool for program work on LICs, the Handbook also refers, in summary form, to a range of relevant policies that apply more generally to IMF members. As with all guidance notes, the relevant IMF Executive Board decisions, including the terms of the various LIC Trust Instruments that have been adopted by the Board, remain the sole legal authority on the matters covered in the Handbook.

2017 Handbook of IMF Facilities for Low-Income Countries

Policy Papers ◽  
2017 ◽  
Vol 2017 (2) ◽  
Author(s):  
Keyword(s):  
Developing Countries ◽  
Low Income ◽  
Poverty Reduction ◽  
Safety Net ◽  
Policy Coordination ◽  
Low Income Countries ◽  
Executive Board ◽  
Reference Tool ◽  
Financial Safety Net ◽  
Comprehensive Reference

This Handbook provides guidance to staff on the financial facilities and non-financial instruments for low-income countries (LICs), defined here as all countries eligible to obtain concessional financing from the Fund. It updates the previous version of the Handbook that was published in February 2016 (IMF, 2016d) by incorporating modifications resulting from Board papers and related decisions since that time, including Financing for Development—Enhancing the Financial Safety Net for Developing Countries—Further Considerations (IMF, 2016c), Review of Poverty Reduction and Growth Trust – Review of Interest Rate Structure (IMF, 2016b), Eligibility to Use the Fund’s Facilities for Concessional Financing (IMF, 2017a), Large Natural Disasters—Enhancing the Financial Safety Net for Developing Countries (IMF, 2017b) and Adequacy of the Global Financial Safety Net – Proposal for a New Policy Coordination Instrument (IMF, 2017c). Designed as a comprehensive reference tool for program work on LICs, the Handbook also refers, in summary form, to a range of relevant policies that apply more generally to IMF members. As with all guidance notes, the relevant IMF Executive Board decisions, including the terms of the various LIC Trust Instruments that have been adopted by the Board, remain the sole legal authority on the matters covered in the Handbook

2014 Handbook of IMF Facilities for Low-Income Countries

Policy Papers ◽  
2014 ◽  
Vol 2014 (70) ◽  
Author(s):  
Keyword(s):  
Low Income ◽  
Low Income Countries ◽  
Legal Authority ◽  
Executive Board ◽  
Reference Tool ◽  
Comprehensive Reference

This Handbook, an updated version of a similarly titled document issued in May 2012 (IMF, 2012c), provides guidance to staff on the financial facilities for low-income countries (LICs) that became effective in January 2010 (ECF, SCF, and RCF), and the PSI, including modifications to the guidance resulting from the Review of Facilities for Low-Income Countries (IMF, 2012e and 2013d) and the Review of Eligibility to Use the Fund’s Facilities for Concessional Financing (IMF, 2013c). Designed as a comprehensive reference tool for program work on low-income countries, the Handbook also refers, in summary form, to a range of relevant policies that apply more generally to IMF members. As with all guidance notes, the relevant IMF Executive Board decisions, including the terms of the various LIC Trust Instruments that have been adopted by the Board, remain the sole legal authority on the matters covered in the Handbook.

Update on the Financing of the Fund's Concessional Assistance and Debt Relief to Low-Income Member Countries

Policy Papers ◽  
2016 ◽  
Vol 16 (19) ◽  
Author(s):  
Keyword(s):  
Financial Market ◽  
Low Income ◽  
Poverty Reduction ◽  
Commodity Prices ◽  
Safety Net ◽  
Global Environment ◽  
Low Income Countries ◽  
Executive Board ◽  
General Fund ◽  
Financial Safety Net

Better targeted support to LICs. In July 2015, the Executive Board approved measures to strengthen the financial safety net for low-income countries. Specifically, access norms and limits to the Poverty Reduction and Growth Trust (PRGT) resources were increased by 50 percent and the Rapid Credit Facility (RCF) interest rate was set permanently at zero. In addition, four countries graduated from PRGT eligibility. Together with a rebalancing of the mix of blended financing towards more use of general Fund resources for better-off PRGT-eligible countries, these reforms were broadly resource neutral and left the PRGT self-sustaining framework intact. Demand for PRGT resources up strongly. In 2015, demand reached SDR 1.5 billion, largely in response to shocks to commodity prices and adverse global financial market conditions. Demand is expected to remain elevated in 2016, as the global environment continues to be challenging.

Update on the Financing of the Fund’s Concessional Assistance and Debt Relief to Low-Income Countries

Policy Papers ◽  
2017 ◽  
Vol 17 (15) ◽  
Author(s):  
Keyword(s):  
Natural Disasters ◽  
Financial Market ◽  
Low Income ◽  
Commodity Prices ◽  
Safety Net ◽  
Debt Relief ◽  
Balance Of Payments ◽  
Low Income Countries ◽  
Market Conditions ◽  
Financial Safety Net

PRGT-related policies following the 2015 enhancement of the financial safety net for LICs, while options to better assist countries confronting sudden balance of payments needs due to large natural disasters are under consideration. Demand for PRGT resources has increased. Demand for concessional resources has exceeded historical averages in recent years, mainly in response to sustained low commodity prices and deteriorated global financial market conditions. Demand is expected to reach new highs in 2017 and longer-term estimates have been raised somewhat.

2005 Review of the Poverty Reduction Strategy Approach - Balancing Accountabilities and Scaling Up Results

Policy Papers ◽  
2005 ◽  
Vol 2005 (67) ◽  
Author(s):  
Keyword(s):  
World Bank ◽  
Low Income ◽  
Poverty Reduction ◽  
Scaling Up ◽  
Low Income Countries ◽  
New Approach ◽  
The World Bank ◽  
Reduction Strategies ◽  
Poverty Reduction Strategy ◽  
The International Monetary Fund

In December 1999, the World Bank (the Bank) and the International Monetary Fund (the Fund) introduced a new approach to their relations with low-income countries, centered around the development and implementation of poverty reduction strategies (PRS) by the countries as a precondition for access to debt relief and concessional financing from both institutions. These strategies were also expected to serve as a framework for better coordination of development assistance among other development partners.

A New Architecture of Facilities for Low-Income Countries

Policy Papers ◽  
2009 ◽  
Vol 09 ◽  
Author(s):  
Keyword(s):  
Low Income ◽  
Poverty Reduction ◽  
Low Income Countries ◽  
Executive Board ◽  
New Facilities

This paper proposes a new facilities architecture for Low-Income Countries. It is based on "Option 2" set out in the framework paper discussed by the Executive Board on March 20, 2009. The new architecture provides a unified facilities framework for LICs under a new Poverty Reduction and Growth Trust (PRGT). The facilities are distinguished primarily by the duration of the financing and adjustment needs and the conditionality standard.

Poverty Reduction and Growth Trust - 2017 Borrowing Agreements with the Bank of Spain, the Government of Japan and the People's Bank of China

Policy Papers ◽  
2017 ◽  
Vol 17 (50) ◽  
Author(s):  
Keyword(s):  
Interest Rate ◽  
Low Income ◽  
Poverty Reduction ◽  
Low Income Countries ◽  
Executive Board ◽  
Bank Of China ◽  
Current Board ◽  
The Media ◽  
The Government ◽  
Set Up

the Poverty Reduction and Growth Trust (PRGT or Trust), has entered into a new borrowing agreement with the Bank of Spain (Spain), amendments to the 2010 NPA with the Government of Japan (Japan), and a new note purchase agreement (NPA) with the People’s Bank of China (China). The new borrowing agreement with Spain, the amendments to the NPA with Japan, and the new NPA with China provide new resources of SDR 450 million, SDR 1.8 billion and SDR 800 million, respectively, to the General Loan Account of the PRGT for a total amount of SDR 3.05 billion in new PRGT lending resources. The new borrowing agreement, the augmentation under the amended NPA and the new NPA are among the first ten loan contributions concluded in the context of the current Board endorsed effort to raise SDR 11 billion in new PRGT loan resources. These became effective on February 22, 2017, for Spain; April 20, 2017, for Japan; and April 21, 2017, for China. Pursuant to Section III, paragraph 2 of the Instrument to establish the PRGT, the Managing Director is authorized to enter into borrowing agreements and agree to their terms and conditions with lenders to the Loan Accounts of the Trust. This paper presents to the Executive Board for information the new borrowing agreement with Spain, the amendments to augment the existing agreement with Japan, and the new NPA with China. The new borrowing agreement with Spain and NPA with China incorporate the following recent changes to the Fund’s framework for concessional lending to low income countries, which have also been adopted, as applicable, in prior amendments to the agreement with Japan: (i) the extensions of the commitments and drawdown period for PRGT loans to end-2020 and end-2024, respectively; (ii) the incorporation of the Chinese Renminbi (RMB) interest rate instrument of six month maturity for borrowing agreements in currencies; and (iii) the provision that, if the derived six-month SDR interest rate formula results in a negative rate, the applicable interest rate shall be zero percent. With respect to the amendment of the NPA with Japan, in addition to increasing the principal amount of notes that can be issued under the NPA, Japan’s agreement was also modified to: (i) provide more flexibility in the media of payment for purchases under the NPA; (ii) set up a maximum amount for monthly purchases under the NPA; and (iii) to establish a preferred media for payments of interest and principal amount of the notes issued under the NPA. Except for these changes, all other elements of the NPA with Japan remain unchanged.

Reform of the Fund's Policy on Poverty Reduction Strategies in Fund Engagement with Low-Income Countries - Proposals

Policy Papers ◽  
2015 ◽  
Vol 2015 (26) ◽  
Author(s):  
Keyword(s):  
Low Income ◽  
Poverty Reduction ◽  
Poor Country ◽  
Policy Support ◽  
Low Income Countries ◽  
Reduction Strategy ◽  
Reduction Strategies ◽  
Poverty Reduction Strategy Paper ◽  
Poverty Reduction Strategy ◽  
Hipc Initiative

Poverty reduction strategies (PRS) are central to Fund-supported economic and financial programs in low-income countries (LICs). The joint IMF-World Bank’s Heavily Indebted Poor Country (HIPC) Initiative introduced the PRS approach and established documentation requirements centered on the Poverty Reduction Strategy Paper (PRSP). The PRS approach has also been a cornerstone for the Fund’s concessional financing, currently the Extended Credit Facility (ECF), and has been extended to the Policy Support Instruments (PSI), the non-financing instrument for LICs, with PRS documentation serving as the operational framework for development of strategies to promote growth and reduce poverty under Fund-supported programs.

Poverty Reduction and Growth Trust Interest Rate Mechanism - Extension of Temporary Interest Rate Waiver

Policy Papers ◽  
2012 ◽  
Vol 2012 (103) ◽  
Author(s):  
Keyword(s):  
Interest Rate ◽  
Low Income ◽  
Poverty Reduction ◽  
Economic Recovery ◽  
Low Income Countries ◽  
Executive Board ◽  
Disaster Assistance ◽  
Post Conflict ◽  
Global Growth ◽  
Rate Mechanism

In recent months, a number of Directors have expressed support in the Executive Board for a further extension of the temporary exceptional interest waiver on concessional lending. An extension would send a signal of the Fund’s continued support for Low-Income Countries at a time when the global economic crisis is still ongoing. In view of the related downside risks to the global economic recovery and a decline in the ability of Low-Income Countries to respond to a further weakening of global growth, this paper proposes a further extension of the exceptional interest waiver by two years, to end-2014. This paper also proposes to further extend to April 2013 the existing subsidization of the rate of charge on outstanding Emergency Natural Disaster Assistance and Emergency Post-Conflict Assistance purchases by PRGT-eligible members.

scholarly journals Are We Providing Enough to Those Who Have Too Little? Measuring Poverty Relief

2017 ◽  
Vol 7 (2) ◽  
pp. 331-347
Author(s):  
Karen L. Jusko ◽  
Katherine Weisshaar
Keyword(s):  
Low Income ◽  
Poverty Reduction ◽  
Program Effectiveness ◽  
Rank Order ◽  
Reduction Rate ◽  
Safety Net ◽  
Poverty Relief ◽  
State Variation ◽  
Social Transfers ◽  
Relief Ratio

This manuscript presents a new measure of safety net program effectiveness—a “poverty relief ratio”—that is based on the estimated relationship between market income and social transfers, and reports the amount of income support provided, relative to the amount required to provide for all low-income households’ basic needs. In an important advance over the standard poverty reduction rate measures, the poverty relief ratio preserves the rank order of observations across varying poverty thresholds. In this paper, we introduce this measure and demonstrate its validity by tracking major changes in federal policy and cross-state variation in safety net programs.

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