Review Of Charges And The Surcharge Policy— A Possible Reform Package
October 21, 2024
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Summary
Against the backdrop of a challenging economic environment and high global interest rates, the Executive Board reached consensus on a comprehensive package of reforms that substantially reduces the cost of borrowing for members while safeguarding the IMF's financial capacity to support countries in need. The approved measures will lower IMF borrowing costs by about US$1.2 billion annually or reduce payments on the margin of the rate of charge as well as surcharges on average by 36 percent. The number of countries subject to surcharges in fiscal year 2026 is expected to fall from 20 to 13.
Key reforms include a reduction in the margin for the rate of charge, an increase in the threshold for level-based surcharges, a reduction in rate for time-based surcharges, an alignment of thresholds for commitment fees with annual and cumulative access limits for GRA lending facilities, and institution of regular reviews of surcharges.
The series of three papers informed the Executive Board’s first and second informal engagements (July and September 2024) and the formal meeting (October 2024) on this review.
Subject: Credit, Income, Money, National accounts
Keywords: Advance repurchases, Charges, Commitment Fees, Credit, General Resources Account, Global, Income, Income, Margin for the basic rate of charge, Precautionary Balances, Surcharges
Publication Details
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Pages:
46
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Volume:
2024
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DOI:
https://0-doi-org.library.svsu.edu/10.5089/9798400290510.007
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Issue:
045
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Series:
Policy Paper No. 2024/045
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Stock No:
PPEA2024045
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ISBN:
9798400290510
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ISSN:
2663-3493