IMF Executive Board Reviews Eligibility to Use the Fund’s Facilities for Concessional Financing for 2017
IMF News, May 23, 2017
Source details
- Canonical URL
- IMF Executive Board Reviews Eligibility to Use the Fund’s Facilities for Concessional Financing for 2017
Other formats
Bibliographic details
- Published: May 23, 2017
Background
- Review date: On May 15, 2017, the Executive Board reviewed the framework for determining eligibility of member countries to use concessional financial resources under the Poverty Reduction and Growth Trust (PRGT) and the current list of PRGT-eligible countries.
- Press release identification: Press Release No. 17/188; publication date: May 23, 2017.
- Framework origins and purpose:
- The PRGT eligibility framework was introduced in 2010.
- Purpose: to include transparent and rules-based criteria to guide decisions on eligibility to access the Fund’s concessional facilities; ensure uniformity of treatment among members; align access to concessional resources with PRGT objectives; and be consistent with the financial self-sustainability of the PRGT.
- Review cadence: The framework and the list of PRGT-eligible members are normally reviewed every two years, with the most recent review completed on July 17, 2015.
- Entry and graduation criteria (general terms):
- Entry: countries enter the PRGT-eligible list when their income per capita is below a specified threshold and they do not have the capacity to access international financial markets on a durable and substantial basis.
- Graduation: countries are expected to graduate when they have achieved income per capita levels that exceed specified thresholds or have established the capacity to access external commercial financing on a durable and substantial basis and they do not face serious short-term vulnerabilities.
Executive Board Assessment
- General views:
- Executive Directors welcomed the opportunity to review the PRGT-eligibility framework and the associated list of PRGT-eligible countries.
- Emphasis that PRGT eligibility should continue to be guided by a framework that is transparent and rules-based, ensures uniformity of treatment among members in similar circumstances, preserves the Fund’s scarce concessional resources for low-income members most in need, while maintaining the self-sustainability of PRGT lending.
- Directors reiterated that the eligibility framework should remain broadly aligned with International Development Association (IDA) practices, while allowing scope for some differences given the different mandates of the two institutions.
- Assessment outcome:
- Directors generally concurred that the existing framework remains broadly appropriate and did not see a need to introduce changes at this time.
- Noted that none of the countries that graduated recently from the PRGT-eligibility list are currently at risk of re-entering it.
- Agreed that no members are currently eligible for entry onto, or graduation from, the list of PRGT-eligible countries.
- Encouraged staff to continue monitoring closely the potential demand for PRGT resources, underscoring the importance of maintaining the self-sustained capacity of the PRGT.
- Welcomed that the decision to keep the list of PRGT-eligible countries unchanged at this review is consistent with the principle of self-sustainability of the PRGT.
- Identified that 13 countries meet the income and/or market access criteria but are assessed to face serious short-term vulnerabilities; Directors emphasized the importance of continuing to help these countries address these vulnerabilities and move towards graduation.
- Process note:
- Directors agreed that the next review of PRGT eligibility would be held on the standard two-year cycle.
- [1] At the conclusion of the discussion, the Managing Director, as Chairman of the Board, summarizes the views of Executive Directors, and this summary is transmitted to the country's authorities. An explanation of any qualifiers used in summings up can be found here:http://www.imf.org/external/np/sec/misc/qualifiers.htm.
Key facts and contact details (as provided)
- Press officer: Raphael Anspach
- Phone: +1 202 623-7100
- Email: MEDIA@IMF.org
International Monetary Fund