Joint IMF-RFAs Press Release on the 6th High-Level RFA Dialogue

IMF News, October 12, 2021

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The International Monetary Fund (IMF) and Regional Financing Arrangements (RFAs) held their sixth High-level RFA Dialogue to reflect on how best to leverage close institutional ties to help members move from crisis to recovery.
Participants included the Managing Director of the IMF and the heads of seven RFAs: Arab Monetary Fund; the ASEAN+3 Macroeconomic Research Office as the surveillance unit of the Chiang Mai Initiative Multilateralisation Agreement; the BRICS Contingent Reserve Arrangement represented by the Reserve Bank of India; Eurasian Fund for Stabilization and Development; European Commission; European Stability Mechanism; and the Latin American Reserve Fund.
The Dialogue reaffirmed commitment to multilateralism and close collaboration between the global and regional layers of the Global Financial Safety Net (GFSN).

Key observations:
- The COVID-19 pandemic continues to flare.
- Recovery is highly uneven globally and the outlook is uncertain.
- Uneven access to vaccines and the possibility of new viral mutations increase risks.
Policy guidance:
- Policy action should be tailored to country-specific circumstances.
- The aim is maximum sustainable employment while protecting the credibility of policy frameworks.
- Continued close collaboration between IMF and RFAs is crucial to support a more even, robust, inclusive, and sustainable recovery.

Since the beginning of the crisis, the IMF has provided financial support of US$118 billion to 87 countries, of which 54 countries are low-income countries.
The IMF has provided about US$860 million in debt service relief to 31 of its poorest members.
Concessional financing and policy reform in July will ensure that the Fund can flexibly support low-income countries’ financing needs during the pandemic and the recovery while continuing to provide concessional loans at zero interest rates.
The largest allocation of Special Drawing Rights (SDRs) in the IMF history—about US$650 billion—came into effect in August 2021.
IMF readiness and priorities:
- The IMF stands ready to support countries vaccinate the population, calibrate policies carefully to their specific circumstances, and accelerate the structural transformation.
- The IMF is encouraging voluntary channelling of SDRs from countries with strong external positions to those most in need.

Scaling up resources for the IMF’s concessional financing through the Poverty Reduction and Growth Trust.
Establishing a new Resilience and Sustainability Trust (RST) to help the most vulnerable countries with structural transformation, including confronting climate-related challenges.
Lending by multilateral development banks.

RFAs reported steps to become more resilient and better address members’ needs, including:
- Preparation of mid-term strategies by some RFAs (in line with respective mandates and varying circumstances).
- Scaling up technical assistance and capacity building efforts.
- Advancing governance reforms.
- Enhancements in operational readiness, provision of COVID-19 financial assistance, tailored economic monitoring, and capacity building at the outset of the crisis.
RFAs welcomed a staff-prepared study on regional responses to the COVID-19 crisis and look forward to its forthcoming publication.
The joint endeavour demonstrates dedication to sharing crisis prevention and management experiences.

The IMF and RFAs appreciated the dialogue with Mr. Agustin Carstens, General Manager of the Bank for International Settlements, on lessons from the COVID-19 crisis for the GFSN.
An update from the French co-chair of the G20 International Financial Architecture Working Group on the group’s priorities, especially regarding a well-functioning global safety net for a strong, inclusive recovery, was considered timely.
A shared conclusion: the increasing risk of more frequent and severe shocks to the international monetary system calls for building resilience and strong multilateral collaboration.

The IMF and RFAs welcomed the Arab Monetary Fund’s initiative to host a special meeting of the RFA heads in Abu Dhabi in early 2022.
The seventh High-level RFA Dialogue will be convened at the time of the next IMF/World Bank Annual Meetings in October 2022.

Joint IMF-RFAs Press Release on the 6th High-Level RFA Dialogue — Press Release No. 21/298 (October 12, 2021), IMF Communications Department.