Press Release: IMF Executive Board Approves New Two-Year US$23 Billion Flexible Credit Line Arrangement for the Republic of Poland

January 14, 2015

The Executive Board of the International Monetary Fund (IMF) today approved a successor two-year arrangement for the Republic of Poland under the Flexible Credit Line (FCL) with reduced access in an amount equivalent to SDR 15.5 billion (about US$23 billion, or
918 percent of quota). The Polish authorities intend to treat the arrangement as precautionary and do not intend to draw on the FCL.

The Republic of Poland’s first FCL arrangement was approved on May 6, 2009 (see Press Release No. 09/153). Successor arrangements were approved on July 2, 2010 (see Press Release No. 10/276); January 21, 2011 (see Press Release No. 11/15); and January 18, 2013 (see Press Release No. 13/17).

Following the Executive Board discussion of the Republic of Poland, Mr. Min Zhu, Deputy Managing Director and Acting Chair, made the following statement:

“Poland has very strong economic fundamentals and policy frameworks. The fiscal position is sound and public debt is sustainable. Its credible inflation targeting regime is an effective tool for macroeconomic management. The flexible exchange rate has played a stabilizing role, acting as a shock-absorber during periods of volatility in global financial markets. The banking system is liquid, well capitalized, and profitable, bolstered by an effective financial supervision.

“The authorities have continued to rebuild policy space and further strengthen policy frameworks. Gradual fiscal consolidation has continued and a permanent expenditure rule, implemented in 2013, is expected to help safeguard long-term fiscal soundness. International reserves have increased and are broadly adequate against standard benchmarks. In the banking system, reliance on cross-border parent bank funding has declined and foreign currency mortgage origination was halted with the tightening of prudential rules.

“External risks have abated somewhat but remain elevated. A protracted period of slower growth in the euro area could have large effects on Poland via trade and confidence channels. An abrupt surge in volatility in global financial markets, or a severe deterioration in external financing conditions could affect Poland’s economy given its relatively high external financing needs. Persistent geopolitical tensions in the region add to downside risks.

“Against this background, a successor two-year FCL arrangement with lower access, which the authorities intend to continue to treat as precautionary, reinforces Poland’s buffers against external risks, helps sustain market confidence, and supports the authorities’ sound economic strategy. In addition, the lower access sends a clear signal of the authorities’ intention to exit from the FCL arrangement once external risks recede.”


The FCL was established on March 24, 2009 and further enhanced on August 30, 2010 (see Press Release No. 10/321). The FCL is available to countries with very strong fundamentals, policies, and track records of policy implementation and is particularly useful for crisis prevention purposes. FCL arrangements are approved for countries meeting pre-set qualification criteria (see Press Release No. 09/85). The FCL is a renewable credit line, which could be approved for either one or two years. Two-year arrangements involve a review of eligibility after the first year. If the country draws on the credit line, the repayment period is between three and five years. There is no cap on access to Fund resources under the FCL, and access is determined on a case-by-case basis. Qualified countries have the full amount available up-front, with no ongoing conditions. There is flexibility to either draw on the credit line at the time it is approved, or treat it as precautionary.

The Republic of Poland is a member of the IMF since 1986 and has a quota of SDR 1,688.40 million (about US$2,485.51 million).


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