Policy Papers

<p>
<strong>
1. This paper is the latest in the Fund’s work stream on the Adequacy
of the Global Financial Safety Net (GFSN).
</strong>
The paper follows the Executive Board’s discussion of the
<em>
Adequacy of the Global Financial Safety Net—Review of the Flexible
Credit Line and Precautionary and Liquidity Line, and Proposals for
Toolkit Reform
</em>
on June 30, 2017 (the "June paper"),1 and presents revised reform proposals
in light of Directors’ views. In the absence of sufficient Executive Board
support for a new liquidity facility, the paper proposes to retain the
Precautionary and Liquidity Line (PLL). It also proposes to introduce a
Time-Based Commitment Fee (TBCF) in light of many Directors’ support for
this feature.
</p>
<p>
<strong>
2. This work is part of the Fund’s broader work stream to strengthen
the GFSN
</strong>
. As such, it complements the new non-financing Policy Coordination
Instrument and operational principles and framework for future Fund
engagement with Regional Financing Arrangements.2
</p>
<p>
<strong>3. The paper is organized as follows. </strong>
Section II lays out the revised set of reform proposals. Section III sets
forth issues for discussion, and proposes decisions to (i) complete the
review of the Flexible Credit Line (FCL) and the PLL; and (ii) introduce a
TBCF. The paper also includes an Annex that describes a planned revision to
the presentation of the Fund’s Forward Commitment Capacity (FCC) to provide
a breakdown between precautionary and other Fund commitments.
</p>