IMF will overhaul lending policy to help recession-hit nations
Thursday, 26 March 2009
From Fazle Rashid
NEW YORK: Mar 25: The International Monetary Fund (IMF) will overhaul its lending policy to help emerging nations battered by the furious gale raging in the financial markets throughout the world. IMF said it would bring in new lending facility, modify conditions and restructure repayment conditions for other loans, a reputed paper said.
The Fund will propel more into emerging market countries and lessen the stigma attached to tapping the fund, the same paper said. The money will be available only when any country needs it. The IMF wants the " facility to be largely preventive, encouraging countries to draw on its money rather than waiting until a full blown crisis drives them into the hands of the lender of last resort".
The facility will be made available to countries with strong and well-run emerging market economies which have suffered due to sharp fall in export trade and drying up of external finance. Countries in distress are fearing to approach IMF for such lending because it would spark panic in the market.
Analysts do not expect that there would be a rush for IMF loan. Fund's " short term liquidity facility" failed to draw a single borrower since its launch in 2008. The programme is being abandoned.
The condition will be more flexible for the new funding facility. The borrowers will have up to five years to repay the loan and there will be no cap on how much they can borrow. Three conditions that will make a country eligible for the new facility are a sustainable public debt, low and stable inflation and a current account deficit that is not too high.
IMF claimed that the response from the emerging countries have been encouraging. The Fund will dispense with its " structural performance criteria" which was a rigid means of compelling borrower countries to reform. It will do away with the system of administrative mechanism designed to induce early repayments. Instead there will be grace periods and simple repayment schedules. The Fund is trying to replenish its quickly depleting resources.
The US wants IMF to triple its firepower. Europeans is little subdued and would like to see fund doubling its capital base. Japan has already given an additional $100 billion and European Union (EU) has committed $102 billion to boost Fund's lendable resources to address the current crisis worldwide. The Fund will make efforts to garner more resources before the G20 summit.
The economic meltdown has dealt a severe blow to many countries but for some hedge fund executives it has made no difference. Top 25 hedge fund managers reaped a total of $11.6 billion in pay and perks. Managers' compensations were eye-popping in a year when hedge funds lost 18 per cent and investors withdrew their equities en masse. Government is seeking expand its regulatory role in hedge fund. European Central Bank (ECB) is fiercely resisting options to print as much money as needed to flood the financial market. ECB is not willing to follow US, Britain and Japan. These countries are printing money in a bid to prop up their economies.
The losses for the world's airline industry, grappling with its deepest crisis in 60 years will be nearly $5.0 billion this year as the economic slowdown continues to shrink passenger and traffic, the New York Times (NYT) reported today quoting IATA. The slowdown has badly affected world's two largest airline manufacturers Boeing of US and Airbus of Europe.
Amnesty International in a report said today that at least 2390 people were executed in 2008 compared to 1252 in 2007. In all, 59 countries still have capital punishment.
China was at the top with executions of 1718 persons. Iran with 346, Saudi Arabia with 102, the United States with 37 and Pakistan with 36 followed China. The methods used in execution vary, with Saudi Arabia going for beheading, hanging in Japan, Iraq, Singapore and Sudan, lethal injections in China, electrocution in the United States, firing squad in Afghanistan, Belarus and Vietnam and stoning in Iran.
NEW YORK: Mar 25: The International Monetary Fund (IMF) will overhaul its lending policy to help emerging nations battered by the furious gale raging in the financial markets throughout the world. IMF said it would bring in new lending facility, modify conditions and restructure repayment conditions for other loans, a reputed paper said.
The Fund will propel more into emerging market countries and lessen the stigma attached to tapping the fund, the same paper said. The money will be available only when any country needs it. The IMF wants the " facility to be largely preventive, encouraging countries to draw on its money rather than waiting until a full blown crisis drives them into the hands of the lender of last resort".
The facility will be made available to countries with strong and well-run emerging market economies which have suffered due to sharp fall in export trade and drying up of external finance. Countries in distress are fearing to approach IMF for such lending because it would spark panic in the market.
Analysts do not expect that there would be a rush for IMF loan. Fund's " short term liquidity facility" failed to draw a single borrower since its launch in 2008. The programme is being abandoned.
The condition will be more flexible for the new funding facility. The borrowers will have up to five years to repay the loan and there will be no cap on how much they can borrow. Three conditions that will make a country eligible for the new facility are a sustainable public debt, low and stable inflation and a current account deficit that is not too high.
IMF claimed that the response from the emerging countries have been encouraging. The Fund will dispense with its " structural performance criteria" which was a rigid means of compelling borrower countries to reform. It will do away with the system of administrative mechanism designed to induce early repayments. Instead there will be grace periods and simple repayment schedules. The Fund is trying to replenish its quickly depleting resources.
The US wants IMF to triple its firepower. Europeans is little subdued and would like to see fund doubling its capital base. Japan has already given an additional $100 billion and European Union (EU) has committed $102 billion to boost Fund's lendable resources to address the current crisis worldwide. The Fund will make efforts to garner more resources before the G20 summit.
The economic meltdown has dealt a severe blow to many countries but for some hedge fund executives it has made no difference. Top 25 hedge fund managers reaped a total of $11.6 billion in pay and perks. Managers' compensations were eye-popping in a year when hedge funds lost 18 per cent and investors withdrew their equities en masse. Government is seeking expand its regulatory role in hedge fund. European Central Bank (ECB) is fiercely resisting options to print as much money as needed to flood the financial market. ECB is not willing to follow US, Britain and Japan. These countries are printing money in a bid to prop up their economies.
The losses for the world's airline industry, grappling with its deepest crisis in 60 years will be nearly $5.0 billion this year as the economic slowdown continues to shrink passenger and traffic, the New York Times (NYT) reported today quoting IATA. The slowdown has badly affected world's two largest airline manufacturers Boeing of US and Airbus of Europe.
Amnesty International in a report said today that at least 2390 people were executed in 2008 compared to 1252 in 2007. In all, 59 countries still have capital punishment.
China was at the top with executions of 1718 persons. Iran with 346, Saudi Arabia with 102, the United States with 37 and Pakistan with 36 followed China. The methods used in execution vary, with Saudi Arabia going for beheading, hanging in Japan, Iraq, Singapore and Sudan, lethal injections in China, electrocution in the United States, firing squad in Afghanistan, Belarus and Vietnam and stoning in Iran.