Low-Income Countries
The IMF has acted with unprecedented speed and scale to support low-income countries during the pandemic. The Fund provided financial support to 53 of 69 eligible low-income countries in 2020 and in the first half of 2021, with about US$14 billion disbursed as zero percent interest rate loans from the Poverty Reduction and Growth Trust.
Most of this support was through the Fund’s emergency financing instruments—the Rapid Credit Facility (RCF) and Rapid Financing Instrument (RFI)—which provide immediate, one-time disbursements to countries facing urgent balance of payments needs. The Fund was able to respond to a record number of requests for financial assistance through a series of temporary access limit increases to the RCF and RFI, and temporary increases in the Poverty Reduction and Growth Trust (PRGT) overall access limits.
The Executive Board completed the Sixth Reviews under the Extended Fund Facility (EFF) and Extended Credit Facility (ECF) arrangements for Papua New Guinea, providing the country with immediate access to about US$82 million.
The IMF Executive Board completed the seventh and final review under the Extended Credit Facility (ECF) Arrangement for Nepal, enabling a disbursement of SDR 31.32 million (about US$ 42.9 million). Nepal has made tangible progress in implementing reforms under the program which has helped preserve macroeconomic and financial stability and build buffers to mitigate the impact of global shocks and domestic uncertainty on economic activity.
The IMF Executive Board approved an SDR 185.031 million (equivalent to US$ 250 million) ECF arrangement for Rwanda and authorized an immediate disbursement of SDR 26.433 million (about US$35.7 million).
Washington, DC – June 8, 2026: Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), announced today that Tobias Adrian has decided to step down from his position as Financial Counsellor and Director of the IMF’s Monetary and Capital Markets Department (MCM), effective August 31, 2026.
IMF Executive Board Concludes 2026 Article IV Consultation with Republic of North Macedonia
Statement by IMF Deputy Managing Director Kenji Okumura at the Conclusion of His Visit to Thailand
Economic thinking must evolve to account for a shift in how nations pursue security, growth, and influence
As governments intervene more, evidence shows that the benefits are modest and depend on thoughtful design
The region’s central banks have built significant credibility over two decades, anchoring price expectations and bolstering resilience against external shocks
Governments can protect vulnerable households, keep businesses open, and preserve price signals without straining public finances
Resilience, supervision, and international coordination are essential to safeguarding global financial markets as new AI tools enable attackers
Fiscal pressures in developing countries make stronger domestic revenue systems more important than ever
I welcome the IEO’s comprehensive evaluation, which finds that the Fund’s work on climate has had high value for our members. The report provides a well-structured assessment of the Fund’s climate-related engagement across surveillance, lending, and capacity development, highlighting how this work has been anchored in members’ macroeconomic and financial frameworks. To follow up on the IEO’s three main recommendations—which I support, with some qualifications—a Management Implementation Plan (MIP) will be developed, consistent with resource constraints and closely aligned with existing workstreams, including the ongoing CSR, ROC, and FSAP reviews.
Executive Directors welcomed the report of the Independent Evaluation Office (IEO) on the IMF and Climate Change and its well-structured assessment of the Fund’s engagement across surveillance, lending, and capacity development. Most Directors concurred with the report’s positive assessment that the Fund’s work on climate, anchored in members’ macroeconomic and financial frameworks, has provided high value for the membership and the Global Climate Architecture. They noted that the initial phase of implementation involved upfront investment costs and significant institutional learning, with efficiency improving over time as capabilities, organization, and coordination strengthened. Most Directors agreed with the evaluation’s assessment that there is scope to further strengthen the application of the new climate approach, and supported the IEO’s key recommendations for improvement with some qualifications regarding specific suggestions. Noting that some of the challenges are common to many workstreams, Directors stressed the need for close alignment with current and upcoming workstreams, including the Comprehensive Surveillance Review (CSR), Review of Program Design and Conditionality, Financial Sector Assessment Program Review, and Review of the Resilience and Sustainability Trust (RST). Directors emphasized the need to take into consideration resource constraints and highlighted the resulting need for prioritization. While a few Directors considered that the climate strategy might have crowded out the Fund’s core work and the evaluation should have assessed its consistency with the Fund’s mandate, most Directors stressed the need for sustained institutional support to preserve the progress achieved with the new approach.
At the time of the 2005 Review of the Fund’s Transparency Policy, the Executive Board requested regular updates on trends in implementing the transparency policy. This report provides an overview of recent developments in implementation of the policy, reflecting information on documents considered by the Board in 2023 and updating the previous annual report on Key Trends issued in July 2024. Deeper analysis of these trends is undertaken in the context of periodic reviews of the Fund’s Transparency Policy.
On May 8, 2026, the IMF’s Executive Board approved another six-month extension of the period to consent to the quota increase and to the New Arrangements to Borrow (NAB) rollback under the Sixteenth General Review of Quotas (GRQ), through November 15, 2026. Such extension also extends the period of consent for quota increases under the Fourteenth GRQ. The previous deadline was due to expire on May 15, 2026. However, the Board of Governors Resolution No. 79-1 provides that the Executive Board may extend the period for consent as it may determine.
This paper updates the projections of the Fund’s income position for FY 2026 and FY 2027–2028 and proposes related decisions for the current and the following financial years. The paper includes proposed decisions to transfer SDR 1.38 billion of GRA resources to the Interim Placement Administered Account and to transfer estimated Fixed Income income and a payout from the Endowment Subaccount to help meet administrative expenses. It also includes a proposed decision to keep the margin for the rate of charge unchanged at 60 basis points for FY 2027–2028. The Fund’s total comprehensive income for FY 2026 is projected at about SDR 3.8 billion; reflecting an estimated pension-related remeasurement gain and retained income in the Investment Account. The Executive Board approved these decisions on April 28; 2026.
The global economic and financial environment is characterized by profound transformation and heightened uncertainty, including that stemming from the war in the Middle East. In this context, demand for Fund engagement is expected to remain strong, continuing to require difficult trade-offs within a real flat budget. The FY27-29 budget maintains a longstanding emphasis on discipline, focus, and agility in line with the evolving needs of the membership. Implementation of a Fund-wide streamlining exercise is reinforcing ongoing department-level prioritization to create space for the highest priority needs, relieve staff work pressures, and maintain capacity for unforeseen demands.
This study uses an entropy balancing model to show that coups d’état can reduce GDP growth by around 2.3 percentage points in the same year. This is a larger effect than some previous estimates, and is found to be persistent over time, reducing cumulative GDP growth by around five percentage points over the following five years. This study goes deeper than previous research into the drivers of that impact, finding that economic sanctions are an an important reason for the observed lower growth in many cases and that the principal channel is via private consumption and investment.
Timely assessment of economic activity is crucial for effective policymaking at the national, regional, and global levels. However, many economies still do not publish GDP data at a quarterly basis, creating persistent information gaps. In 2025, 34% of economies publish only annual GDP statistics. This lack of higher-frequency and timely data is particularly restrictive for emerging market and developing economies, where economic volatility and spillover risks are often highest. The problem is more severe for historical data: only 42% of economies have quarterly GDP estimates for a period longer than 20 years. To address these gaps, this paper develops a model that estimates missing quarterly GDP series by leveraging global and regional economic interconnections. The method transforms sparse annual data into quarterly estimates by exploiting higher-frequency information from the rest of the world, enabling real-time policymaking in both data-scarce economies and in global-level discussions. Moreover, this method ensures internally consistent estimates of regional and global economic activity, allowing both top-down and bottom-up scenario analyses.
This paper shows that sovereign bond spreads are shaped not only by absolute debt levels but also by a country’s relative debt position within its peer group. Using panel fixed effects for over 80 emerging and developing economies over 1993-2024, we find that relative debt—especially benchmarked by income and commodity status—has greater explanatory power for spreads than gross debt alone. A one–standard deviation increase in relative debt raises spreads by roughly 0.2–0.3 standard deviations, comparable in magnitude to global risk indicators. Similarly, a 10 percent increase in relative debt is associated with a 3.8 percent increase in sovereign spreads, all else equal. The effect of relative debt is state-dependent, being stronger in countries with better institutions, access to concessional lending, and during periods of low risk aversion and ample global liquidity. These results hold across alternative specifications, sample periods, methodologies, and controls, which underscores the comparative nature of investor assessments and the importance of benchmarking for fiscal policy, debt management, and international surveillance.
Germany’s economy experienced a pronounced recession during 2023–24, with real GDP contracting and growth falling notably behind the rest of the euro area. This paper systematically examines the underlying causes of this downturn using four complementary approaches. We find that about 60 percent of Germany’s growth underperformance was due to lower potential growth while about 40 percent reflected cyclical factors. The downturn was broad-based, with nearly all major expenditure categories—but particularly investment and exports—weighing on activity. On the production side, the recession was concentrated in manufacturing and construction, which together accounted for the bulk of the growth gap relative to the euro area. The analysis further shows that the decline in output was driven primarily by falling productivity, especially in industry and construction, rather than by a reduction in hours worked. This decline in productivity partly reflected cyclical labor hoarding amid weak aggregate demand. However, structural challenges—including (i) longer-term subdued productivity growth due to structural factors such as persistent underinvestment in public infrastructure, skills, and innovation as well as excessive red tape; (ii) population aging; (iii) one-off adverse effects from the 2022 energy-price shock, and (iv) deteriorating external competitiveness (although the level of the current account surplus remains substantial)—amplified the cyclical downturn.
This paper takes stock of the Recovery and Resilience Facility (RRF)’s economic impact as implementation enters its final phase and draws lessons for the design of the next EU Multiannual Financial Framework (MFF). Using sectoral and cross-country data, the paper finds that the RRF provided a short term demand boost, supporting employment and output growth—especially in countries with large allocations—while a substantial share of its growth impact is expected to materialize as absorption accelerates. Unprecedented joint EU level borrowing is found to have contributed to stabilizing sovereign debt markets and improving prospects for EU bonds as safe assets. Finally, the RRF’s performance based conditionality through improved national ownership has supported reform implementation in some member states. At the same time, challenges around the pace of funds absorption remain as implementation is still ramping up and the overall macroeconomic impact will ultimately depend on how effectively the RRF funds are utilized. Plan overambition and complexity, administrative capacity limits, and absorption bottlenecks have slowed disbursement in several member states, while the predominance of output based milestones and targets has limited the framework’s focus on results.
As public debt in emerging markets (EMs) and low-income countries (LICs) has surged since the COVID-19 pandemic, so has the exposure of domestic banks to their sovereigns—raising concerns of destabilizing feedback loops if fiscal conditions deteriorate. This paper provides a comprehensive analysis of this sovereign-bank nexus using a new granular dataset covering over 120 EMs and LICs, combined with IMF Financial Soundness Indicators. We document a marked post-pandemic strengthening of the nexus, particularly in Sub-Saharan Africa and the Middle East and Central Asia, and show that public debt levels, deposit rates, and nonperforming loans are its most robust correlates. While we find no broad evidence of financial repression, higher sovereign refinancing needs significantly increase banks' government debt holdings in countries with substantial state-owned bank presence. Sensitivity analysis illustrates that the consequences of a strong nexus can be severe: even a moderate domestic debt restructuring could render several banking systems undercapitalized, underscoring that high reported capital ratios in strong-nexus countries may provide a false sense of security.
