Transcript of IMF Press Briefing
IMF News, March 12, 2020
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- Published: March 12, 2020
COVID-19: economic impact and outlook
- Under any scenario, global growth in 2020 will drop below last year's level which was 2.9 percent.
- The extent and duration of the downturn are highly uncertain and depend on:
- the spread and propagation of the outbreak;
- the measures taken to respond and their effectiveness.
- The IMF will provide more precise forecasts and numbers in the upcoming World Economic Outlook.
- The IMF characterizes the coronavirus outbreak as first and foremost a health crisis and a human crisis; economic effects follow and require targeted policy responses.
Coordinated action: types and priorities
- International cooperation is essential because the disease crosses national borders; key elements include:
- information sharing and exchange of findings about the virus;
- leveraging collective resources and working closely with partners (World Health Organization, World Bank, regional development banks, central banks, BIS);
- forward-leaning, well-targeted and proportionate public health measures to strengthen health systems and contain economic impact.
- Policy tools the IMF highlights:
- targeted financing to support healthcare systems and directly affected people;
- monetary and fiscal support to help the economy where needed most.
- The IMF is conducting regional press briefings and will release flagship documents (World Economic Outlook, Global Financial Stability Report, Fiscal Monitor report) in virtual formats around the Spring Meetings.
IMF role, engagement, and operational response
- The IMF is actively engaged with member countries (189 member countries) through consultations and coordination:
- Managing Director Kristalina Georgieva held a teleconference with the membership and convened an emergency IMFC meeting.
- Coordination with central banks, BIS, WHO, World Bank, and regional development banks is ongoing.
- Existing IMF instruments and resources mentioned:
- lending facilities including rapid financing facilities, rapid credit facility, and the rapid financing instrument;
- Catastrophe Containment and Relief Trust (CCRT) for very poor countries, providing debt relief (grants).
- The IMF announced that support to vulnerable countries would be available via existing lending facilities and could amount to up to $50 billion for low income and emerging market member countries.
- The IMF is receiving inquiries and requests, including from Iran, and is proceeding expeditiously with requests in line with IMF policies.
Financing status and calls for contributions
- The United Kingdom announced a contribution of £150 million to the CCRT as part of its budget statement.
- The United Kingdom’s £150 million contribution is noted in local-USD approximations in the briefing as "about $200 million, $194 million."
- The CCRT currently has about 200 million available and is described as significantly underfunded; the IMF is urging member countries to contribute urgently.
Country-specific engagements and updates
- Argentina:
- IMF staff held technical meetings in Buenos Aires; engagement described as active and constructive.
- Dialogue with Argentine authorities has not been affected by the coronavirus outbreak.
- Authorities have not approached the IMF with a request under the newly announced facilities as of the briefing.
- Ecuador:
- An IMF staff team led by Anna Ivanova visited Quito about a month earlier to take stock of developments, including the sharp fall in oil prices.
- The Managing Director had a call with President Moreno to discuss global developments and their impact on Ecuador.
- IMF views recent Ecuadorian government measures as positive steps and will continue close cooperation.
- Ukraine:
- A new Government was appointed; it has indicated it wants to continue cooperation with the IMF and an IMF-supported program.
- The IMF stands ready to support Ukraine’s reform efforts and macroeconomic policies.
- Lebanon:
- Lebanese authorities have not requested financial assistance from the IMF.
- An IMF staff team visited Lebanon some weeks earlier and returned to Washington; the IMF is waiting to receive the authorities' plans.
- Nigeria (and oil-exporting countries):
- The sharp decline in oil prices is expected to have significant impact on Nigeria and on activity in the non-oil sector.
- The IMF will monitor vulnerabilities closely and work with authorities on well-targeted, proportionate, and sizeable measures.
- Sub-Saharan African countries that were affected during the 2014 Ebola outbreak are expected to be eligible for CCRT support where appropriate.
Financial stability, oil prices, and forecasts
- The impact of the recent sharp decline in the price of oil is under close review; it is too early to provide a specific assessment.
- The IMF will assess oil price developments and their implications for the global forecast in the forthcoming World Economic Outlook.
- Tobias Adrian (financial counselor) and Vitor Gaspar (Fiscal Affairs Director) have published blogs detailing monetary/financial stability and fiscal measures respectively; these communications are consolidated on the IMF landing page for coronavirus-related materials.
Operational modalities and communications
- The IMF Spring Meetings will occur in a virtual format; flagship IMF documents will be released as normal with virtual press conferences.
- Regional press briefings for each of the five major world regions will also be held virtually.
- The IMF is updating a consolidated landing page on IMF.org with press releases, blogs, videos, Q&A and related materials in real time.
Transcript of IMF Press Briefing, March 12, 2020.