Poverty Reduction and Growth Trust (PRGT)

What's the PRGT?

The PRGT is the Fund’s main vehicle for providing concessional financing (currently at zero interest rates) to low-income countries (LICs).

The PRGT’s interest-free loans support well-designed economic programs that help catalyze additional financing from donors, development institutions, and the private sector. PRGT-supported programs also play a central role in creating the environment for successful debt resolution in distressed countries.

And—as seen during the pandemic—the PRGT can also provide emergency support when shocks hit.

At the onset of COVID-19, the IMF rapidly scaled up emergency financing and program support through the PRGT, with new commitments reaching almost $9 billion (6.5 billion special drawing rights) in 2020 alone. Since the start of the pandemic, the IMF has supported more than 50 LICs with some $30 billion (SDR 22.5 billion) in interest-free loans via the PRGT—thus helping to stave off instability in a wide range of the world’s poorest nations, from Haiti to the Democratic Republic of Congo and Nepal. And with low-income countries’ financing needs rising fast, demand for PRGT lending is projected to reach nearly $40 billion (SDR 30 billion) in 2020-24, more than four times the historical average. 

Video: What is the PRGT?

PRGT Funding

The PRGT must be adequately funded and subsidized so that this vital source of interest-free financing can continue and help address the challenges facing LICs which were growing fast before the pandemic. PRGT subsidies have a strong multiplier effect. Each $1 of subsidy resources mobilized allows the PRGT to provide about $5 in zero-interest lending.

The targets for loan (SDR 12.6 billion) and subsidy resources (SDR 2.3 billion) under the 2021 PRGT fundraising round have been successfully met in 2023. Reaching this important milestone has been possible thanks to the support from over 40 partners. Nonetheless, stronger demand and sharply higher interest rates imply additional funding needs. A review, which is currently being conducted, will discuss these needs and explore options to restore the long-term sustainability of PRGT finances.

PRGT Pledges under the 2021 fundraising round
(as of April 26, 2024) 1/
Contributors In SDR millions In USD millions 
Subsidy Target 2,300 3,030
Total Subsidy Pledges 2/ 2,300  3,030
 Australia* 3/  82  108
 Canada* 4/  88  116
 China*3/  168 221
Cyprus 2 3
 Denmark*  20 26
 Estonia*3/  0.4 0.5
 Finland*3/  1 1.3
 France*5/ 251 330.1
 Germany* 147 193
 Greece*6/ 19 25
 Hungary* 3/ 11 14
 Ireland* 19 25
 Italy* 82 108
 Japan* 3/ 7/  479  631
 Korea* 41 55
 Latvia* 2 3
 Lithuania* 2 3
 Malta* 1 1
 Mauritius 1 1
 Morocco* 3/ 0.2 0.2
 Netherlands* 35 47
 Norway* 9 12
 Oman* 3/ 18 24
 Philippines*  4  5
 Portugal*3/  11  14
 Qatar8/ 25 33
 Singapore  21  28
 Slovak Republic*  6  7
 Slovenia* 3/  3  4
 Spain*  50  66
 Sweden*  22  29
 Switzerland*  42  55
 Thailand*  8  10
 Trinidad and Tobago 3/  3  4
 United Kingdom* 8/  250  329
 United States*  55  72
 European CoMmission*  78  102
Additional pledges 9/ 240 316
  of which, subsidy contributions effected 1,747 2,302
Loans target 12,600 16,601
Total Loan Pledges 14,650 19,302
 Australia*  500  659
 Belgium*  250  329
 Canada*  500  659
 China*  1,000 1,318
 Denmark*  150 198
 Finland*  300 395
 France* 2,900 3,821
 Italy* 1,000 1,318
 Japan* 2,000 2,635
 Korea* 450 593
 Netherlands * 500 659
 Norway* 150 198
Qatar8/ 150 198
 Saudi Arabia* 10/  2,800  3,689
 Spain*  350  461
 Sweden*  150  198
 United Kingdom* 8/  1,500  1,976
  of which, effective agreements 14,650 19,302

* Effective pledges / agreements, including cases of multiple contributions where a portion is not yet effective.

1/ Based on SDR/US$ exchange rate as of April 26, 2024.
2/ Including grant contributions received and to be received in future installments.
3/ Includes pledge to be generated over time in the form of net investment earnings from deposit and investment agreements.
4/ Includes about SDR 60 million in grants and SDR 28.5 million estimated by IMF staff to be generated over time in the form of net investment earnings from a deposit agreement.
5/ Includes about SDR 105 million in grants and SDR 145 million estimated by IMF staff to be generated over time in the form of net investment earnings from a deposit agreement.
6/ Greece provided a subsidy grant of SDR 13 million to the PRGT and has effected a deposit of SDR 150 million with the PRGT Deposit and Investment Account, which is expected to generate an additional SDR 6 million in subsidies over time in the form of net investment earnings.
7/ Includes SDR 96 million in grants already disbursed and about SDR 383 million to be generated over time in the form of net investment earnings from a deposit agreement effected with the PRGT Deposit and Investment Account.
8/ The loan resources by Qatar and the United Kingdom have been provided at a concessional rate and are estimated will generate about SDR 25 million and SDR 250 million in implicit subsidies, respectively, subject to SDR interest rate assumptions.
9/ This includes informal indications of intentions to pledge and pledges subject to completion of domestic procedures. Some of the amounts are based on Fund staff estimates.
10/ The loan resources by Saudi Arabia have been provided under three separate borrowing agreements (SDR 550 million, SDR 225 million, and SDR 2,025 million).

How to contribute

Donors will have flexibility regarding their subsidy contributions, with contributions to be pledged upfront and disbursed over time. Contributions options include:

Budgetary grants Concessional loans Desposits and investments 
• Possibly in installments over several years • PRGT loan resources provided at below the SDR rate • This generates income for PRGT subsidization
• A new Subsidy Reserve Account can receive grants that help finance subsidization of PRGT loans while also bolstering reserve coverage of PRGT credit • Loans from contributors provided at low fixed rate of remuneration can save PRGT subsidy expenses and generate implicit subsidies • Long-term deposits in the PRGT’s Deposit and Investment Account or long-term investments in PRGT assets remunerate contributors while generating additional investment earnings that would be transferred as subsidy resources to the PRGT