PH again extends loan support to IMF

MANILA, Philippines — The Philippines has again extended its $1-billion loan support to the International Monetary Fund (IMF) – aimed at helping other economies in distress – until the end of next year.

In a November 5 statement, the Washington-based IMF said terms of the borrowing agreements the lender entered into with 40 of its members – including the Philippines – in 2016 will be effective until 2020.

“The extension of terms preserves the IMF’s overall lending capacity of about $1 trillion for an additional year and is a prudent step to provide confidence to members and markets that the fund continues to have adequate resources to meet the potential needs of the membership. This step is part of a broader package of actions on IMF resources and governance reform – including support for maintaining the IMF’s current resource envelope and considering a doubling of the new arrangements to borrow (NAB) and a further temporary round of bilateral borrowing beyond 2020 – endorsed by the IMF membership at the 2019 annual meetings,” it said.

“Total commitments under the 2016 borrowing framework from 40 members amount to about $433 billion at end-September 2019 exchange rates,” according to IMF.

In the case of the Philippines, it was the Bangko Sentral ng Pilipinas (BSP) that renewed the country’s loan facility.

To recall, BSP first signed in 2013 the $1-billion loan facility with IMF “to support countries going through financial difficulties to minimize their adverse impact on the global community.”

However, the financial facility had never been drawn.

The Philippines already fully paid its IMF loan in December 2006, and became a net creditor in 2011. /kga