Opening Remarks for IMFC Press
IMF News, April 16, 2020
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Bibliographic details
- Published: April 16, 2020
Context and setting
- Speaker: Lesetja Kganyago, Chair of IMFC
- Event date: April 16, 2020
- Format: Virtual press conference (first for the Chair and for the Committee)
- Overarching situation: Novel coronavirus pandemic presenting significant and potentially daunting challenges; described as "remarkable and extraordinary times."
Assessment of the crisis and economic outlook
- The pandemic has a serious human impact and severe economic repercussions, particularly for:
- emerging markets and developing countries
- commodity exporters
- economies with weak health systems
- A global recession and severe uncertainty have "gripped our societies."
- Extraordinary measures already undertaken to support health systems, workers, and businesses.
Key statistics cited
- Fiscal measures to date: about $8 trillion
- Liquidity injections by central banks: over $6 trillion
IMF and IMFC response and toolbox changes
- The IMFC reviewed and supported the IMF's package of financial support assembled in response to the pandemic.
- The Fund has revamped its toolkit by:
- doubling access levels to emergency facilities
- expanding the use of precautionary lines
- establishing a new short-term liquidity line
- considering other options to help countries meet their financing needs
- Emphasis that these crisis response initiatives are critical to contain the impact of COVID-19.
Policy recommendations and collective actions endorsed
- Act quickly, decisively, and in coordination.
- Large, timely and targeted fiscal and financial measures are essential to help citizens.
- Ensure the IMF can support its poorest and most vulnerable members:
- Recognition of pledges already made to replenish the Poverty Reduction and Growth Trust and the Catastrophe Containment and Relief Trust
- Call for additional contributions
- Support for coordinated approach by the G20 and the Paris Club, backed by IMF and World Bank, for a time-bound suspension of debt service payments by bilateral official creditors for the poorest countries that request forbearance.
- Encouragement for private creditors to participate on comparable terms.
Institutional and systemic observations
- The global financial system "has held up well so far"—attributed in part to extraordinary measures by central banks and supervisory authorities.
- Exchange rate and liquidity pressures remain important challenges.
- Strong emphasis on coordination through the IMF to achieve better economic and humanitarian outcomes than would otherwise be possible.
Outlook and concluding messages
- The outlook is subject to "exceptionally high uncertainty."
- Reaffirmation that extraordinary macroeconomic action and working together will contribute to a faster recovery.
- Expression of confidence that effective and constructive collective work will help overcome the challenges.
Source: Opening Remarks for IMFC Press, Lesetja Kganyago, April 16, 2020.