The International Monetary Fund has approved the creation of Resilience and Sustainability Trust (RST) and seeks to raise $45 billion for the new funding facility to help member-nations deal with longer-term structural challenges that pose macroeconomic risks including climate change and pandemics.
The new facility, which aims to help low-income and vulnerable middle-income countries, will come into effect on May 1, IMF Managing Director Kristalina Georgieva said in a statement on Thursday. The trust will “amplify the impact” of the $650bn special drawing rights allocated in August last year by channeling resources from countries with strong external financial positions to vulnerable countries where they are needed the most.
“The aspiration is to build a trust of at least $45bn in resources,” Georgieva said. “We have worked extensively with our members and other stakeholders to design the RST, with the goal of balancing the needs of potential contributors and borrowers.” The IMF approved a record general allocation of $650bn in reserve assets, better known as SDRs, to help member countries, especially emerging and developing nations, cope with the economic fallout of the coronavirus pandemic.—TLTP
