The Catastrophe Containment and Relief Trust (CCRT) provides grants for debt relief for the poorest and most vulnerable countries hit by catastrophic natural disasters or public health disasters. The relief on debt service payments to the IMF frees up resources to help countries meet exceptional balance of payments needs created by the disaster and to pay for containment and recovery.
The CCRT replaced the IMF’s Post-Catastrophe Debt Relief Trust (PCDR) in April 2015 and expanded it to include fast-spreading epidemics, such as Ebola. In March 2020, the IMF adopted reforms to the CCRT to provide immediate debt service relief for its poorest and most vulnerable members affected by the COVID-19 pandemic. The trust provides grants to eligible low-income member countries to pay debt service owed to the IMF if they face natural or public health disasters.
FAQ: CCRTCCRT assistance is available to countries if they are eligible to borrow from the IMF’s Poverty Reduction and Growth Trust (PRGT) and their per-capita income is less than the International Development Association’s (IDA) operational cutoff.
Countries qualify for relief if a natural disaster has directly affected at least one-third of the population, is estimated to have destroyed more than a quarter of the country’s productive capacity or has caused damage deemed to exceed 100 percent of GDP.
Eligibility for public health disasters covers epidemics and pandemics. IMF members qualify for CCRT relief if a life-threatening epidemic has affected several areas of their country, can spread or is already spreading to other countries, and is causing significant economic disruption. Significant economic disruption is defined as a cumulative loss of the country’s real gross domestic product (GDP) of 10% or greater, or a cumulative loss of revenue and increase of expenditures equivalent to at least 10% of GDP.
Member countries also qualify for CCRT relief if a life-threatening global pandemic is inflicting severe economic disruption across the IMF membership, creating balance of payments needs on a scale to warrant a concerted effort to support the poorest and most vulnerable countries through substantial additional grant support and debt service relief.
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In the case of a natural disaster, member countries would receive debt flow relief on their debt service to the IMF falling due in the two years following the disaster. Countries facing public health disasters may receive up-front grants covering debt service falling due to the IMF for a maximum of two years from the initial decision, provided the CCRT has sufficient resources.
Full cancellation of a country’s debt to the IMF is possible in cases where the natural disaster has created substantial and long-lasting balance of payments needs and where the resources freed up by debt relief are critical for meeting these needs. Typically, this would be limited to countries with a very high debt burden. Debt stock relief would be conditional on concerted debt relief efforts by the country’s official creditors and availability of resources in the CCRT.
The CCRT was initially financed with the balance of the earlier Post-Catastrophe Debt Relief Trust (PCDR) and accounts left over from the financing of the Multilateral Debt Relief Initiative. In response to the COVID-19 pandemic, the IMF launched an urgent fundraising effort in April 2020 that enabled the CCRT to provide relief on debt service for the full two-year period, while leaving the CCRT adequately funded for future needs. With an initial fundraising target of SDR 1 billion (US$1.4 billion), the IMF has received contributions to date of about SDR 0.6 billion (US$0.8 billion) from 18 members and the EU.
In December 2021, the IMF’s Executive Board approved the fifth and final tranche for assistance related to the COVID-19 pandemic. In total, 31 CCRT-eligible countries with debt service to the IMF received SDR 690 million (US$927 million) in debt relief over the two-year period from April 14, 2020 to April 13, 2022.
Three countries afflicted by Ebola – Guinea, Liberia, and Sierra Leone – received assistance from the trust of nearly US$100 million in February and March of 2015. Haiti received assistance of about US$270 million in July 2010 under the previous Post-Catastrophe Debt Relief Trust, eliminating Haiti’s entire outstanding debt to the IMF.
The last update was in March 2023
