The Executive Board of the International Monetary Fund (IMF) has successfully completed its review of the Poverty Reduction and Growth Trust (PRGT) facilities and financing, a key initiative providing concessional financing to low-income member countries.
IMF Managing Director Kristalina Georgieva unveiled a comprehensive reform and financing package designed to enhance the Fund’s support for these countries. The newly approved plan includes a framework to leverage IMF net income and reserves, generating approximately $8 billion in additional subsidy resources for the PRGT over the next five years.
Combined with last year’s successful bilateral fundraising and other reform measures, the package is expected to more than double the PRGT’s annual lending capacity to $3.6 billion, compared to pre-pandemic levels. This increase will attract significant funding from both public and private sources.
Georgieva highlighted the urgency of the agreement, noting that low-income countries have faced unprecedented shocks and substantial financing needs. The reform package aims to provide the necessary concessional resources to help these countries implement sound policies and build stronger institutions.
The reforms also address the diverse needs of low-income countries with a new interest rate mechanism that maintains interest-free lending for the poorest nations while ensuring concessionality for others. Access policies will remain flexible, and safeguards will be strengthened and streamlined to ensure effective support.
