The Exogenous Shocks Facility- High Access Component (ESF-HAC)
March 21, 2016
The Exogenous Shocks Facility-High Access Component (ESF-HAC), which was established in 2008, has provided concessional financing to PRGT-eligible countries facing balance of payments needs caused by sudden and exogenous shocks. As part of a broader reform to make the Fund’s financial support more flexible and better tailored to the diverse needs of LICs, the ESF-HAC has been superseded by the Standby Credit Facility (SCF), which became effective in January 2010. Credit outstanding from ESF-HAC arrangements amounts to SDR 516 million as of end-February 2016, and ESF-HAC terms will continue to apply to these balances.
Access was determined on a case-by-case basis. The ESF-HAC provided access up to 75 percent of quota for each arrangement in normal circumstances. Resources were provided in phased disbursements based on reviews, and programs were one-to-two years in length.
The country’s economic program under the ESF focused on adjustment to the underlying shock, with less emphasis on the broad structural adjustment that often characterizes other IMF-supported programs. The ESF could be used concurrently with the Policy Support Instrument (PSI).
ESF loans carry a zero annual interest rate until end-2016, with repayments made semiannually, beginning 5½ years and ending 10 years after the disbursement. The Fund reviews the level of interest rates for all concessional facilities every two years.