The IMF at a Glance -- Factsheet

What is the IMF? an introduction

Financial Organization and Operations of the IMF IMF Pamphlet Series No. 45

Fund Credit Outstanding Guide to Committees and Groups

The IMF at a Glance

February 16, 2000

The International Monetary Fund (IMF) came into official existence on December 27, 1945, when 29 countries signed its Articles of Agreement (its Charter) agreed at a conference held in Bretton Woods, New Hampshire, USA, from July 1-22, 1944. The IMF commenced financial operations on March 1, 1947.

Current Membership: 182 countries.

Total Quotas: SDR 212 billion (almost US$300 billion), following a 45 percent quota increase effective January 22, 1999.

Governing Bodies: Board of Governors, International Monetary and Financial Committee, Executive Board.

Acting Managing Director: Stanley Fischer.

Staff: Approximately 2,700 from 110 countries.

Accounting Unit: Special Drawing Right (SDR). See latest rates.

Statutory Purposes

The IMF was created to promote international monetary cooperation; to facilitate the expansion and balanced growth of international trade; to promote exchange stability; to assist in the establishment of a multilateral system of payments; to make its general resources temporarily available to its members experiencing balance of payments difficulties under adequate safeguards; and to shorten the duration and lessen the degree of disequilibrium in the international balances of payments of members.see Article I

Areas of Activity

Surveillance is the process by which the IMF appraises its members' exchange rate policies within the framework of a comprehensive analysis of the general economic situation and the policy strategy of each member. The IMF fulfills its surveillance responsibilities through: annual bilateral Article IV consultations with individual countries; multilateral surveillance twice a year in the context of its World Economic Outlook (WEO) exercise; and precautionary arrangements, enhanced surveillance, and program monitoring, which provide a member with close monitoring from the IMF in the absence of the use of IMF resources. (Precautionary arrangements serve to boost international confidence in a member's policies. Program monitoring may include the setting of benchmarks under a shadow program, but does not constitute a formal IMF endorsement.)

Financial assistance includes credits and loans extended by the IMF to member countries with balance of payments problems to support policies of adjustment and reform. As of July 31, 1999 the IMF had credit and loans outstanding to 94 countries for an approved amount of SDR 63.6 billion (about $87 billion).

Technical assistance consists of expertise and support provided by the IMF to its members in several broad areas: the design and implementation of fiscal and monetary policy; institution-building (such as the development of central banks or treasuries); the handling and accounting of transactions with the IMF; the collection and refinement of statistical data; training officials at the IMF Institute and, together with other international financial organizations, through the Joint Vienna Institute, the Singapore Regional Training Institute, the Middle East Regional Training Program, and the Joint Africa Institute.

IMF Financial Facilities

The IMF makes its financial resources available to member countries through a variety of financial facilities. Except for the ESAF (see below), members avail themselves of the IMF's financial resources by purchasing (drawing) other members' currencies or SDRs with an equivalent amount of their own currency. The IMF levies charges on these drawings and requires that members repurchase (repay) their own currency from the IMF over a specified time.

Regular IMF Facilities

Stand-by arrangements (SBA): designed to provide short-term balance of payments assistance for deficits of a temporary or cyclical nature, such arrangements are typically for 12 to 18 months. Drawings are phased on a quarterly basis, with their release made conditional on meeting performance criteria and the completion of periodic program reviews. Repurchases are made 3 ¹/4 to 5 years after each purchase.

Extended Fund Facility (EFF): designed to support medium-term programs that generally run for three years, the EFF aims at overcoming balance of payments difficulties stemming from macroeconomic and structural problems. Performance criteria are applied, similar to those in stand-by arrangements, and repurchases are made in 4¹/2 to 10 years.

IMF Financial Policies

IMF financial policies govern the modalities for the use of its financial resources under existing IMF facilities. These include:

Reserve Tranche Policies. A member has a reserve tranche position in the IMF to the extent that its quota exceeds the IMF's holdings of its currency, excluding credits extended to it by the IMF. Subject only to balance of payments need, a member may draw up to the full amount of its reserve tranche position at any time. This drawing does not constitute a use of IMF credit, as its reserve position is considered part of the member's foreign reserves, and is not subject to an obligation to repay.

Credit Tranche Policies. Credits under regular facilities are made available to members in tranches (segments) of 25 percent of quota. For first credit tranche drawings, members must demonstrate reasonable efforts to overcome their balance of payments difficulties, and no phasing applies. Upper credit tranche drawings (over 25 percent) are normally phased in relation to certain conditions or "performance criteria."

Policy on Emergency Assistance. The IMF provides emergency assistance to members to meet balance of payments needs arising from sudden and unforeseeable natural disasters and in postconflict situations. Normally this takes the form of an outright purchase of up to 25 percent of quota provided that the member is cooperating with the IMF. It does not entail performance criteria or a phasing of drawings.

Debt and Debt-Service Reduction Policies. Part of a credit extended to a member by the IMF under regular facilities can be set aside to finance operations involving debt principal and debt service reduction. The exact amount of the set-aside is determined on a case-by-case basis; its availability is generally tied to program performance.

Concessional IMF Facility

Enhanced Structural Adjustment Facility (ESAF): established in 1987, and enlarged and extended in 1994. Designed for low-income member countries with protracted balance of payments problems, ESAF drawings are loans and not purchases of other members' currencies. They are made in support of three-year programs and carry an annual interest rate of 0.5 percent, with a 5¹/2-year grace period and a 10-year maturity. Quarterly benchmarks and semiannual performance criteria apply; 80 low-income countries are currently eligible to use the ESAF.

On November 22, 1999, the ESAF was renamed the Poverty Reduction and Growth Facility (PRGF), and its objectives were changed to support programs to strengthen substantially and in a sustainable manner balance of payments positions, and to foster durable growth, leading to higher living standards and a reduction in poverty. This facility is for assisting eligible members that are undertaking economic reform programs to strengthen their balance of payments, and improve their growth prospects. PRGF loans carry an interest rate of 0.5% and are repayable over 10 years with a 5½-year grace on principal payments.

Other Facilities

Systemic Transformation Facility (STF): in effect from April 1993 to April 1995. The STF was designed to extend financial assistance to transition economies experiencing severe disruption in their trade and payments arrangements. Repurchases are made over 4¹/2 to 10 years.

Compensatory and Contingency Financing Facility (CCFF): provides compensatory financing for members experiencing temporary export shortfalls or excesses in cereal import costs, as well as financial assistance for external contingencies in Fund arrangements. Repurchases are made over 3¹/4 to 5 years.

Supplemental Reserve Facility (SRF): provides financial assistance for exceptional balance of payments difficulties due to a large short-term financing need resulting from a sudden and disruptive loss of market confidence. Repurchases are expected to be made within 1 to 1¹/2 years, but can be extended, with IMF Board approval, to 2 to 2¹/2 years.

Contingent Credit Lines (CCL): is aimed at preventing the spread of a crisis. Whereas the SRF is for use by members already in the throes of a crisis, the CCL is intended solely for members that are concerned with potential vulnerability to contagion. This facility will enable countries that are basically sound and well managed to put in place precautionary financing should a crisis occur. Short-term financing—if the need arises—will be provided under the CCL to help members overcome the exceptional balance of payments financing needs that can arise from a sudden and disruptive loss of market confidence due to contagion, largely generated by circumstances beyond the member's control. Repurchase terms are the same as under the SRF.

IMF Home Search Site Map Site Index Help What's New
About the IMF News Publications Country Info Fund Rates Standards & Codes