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IMF to borrow up to 1.3 bn from the Bank of Finland

The International Monetary Fund (IMF) and the Bank of Finland have signed an agreement to provide IMF with up to  €1.3bn (about $1.7bn).

The agreement is part of a commitment made by the European Union in March 2009 to contribute up to  €75bn (then equal to about $100b) to support the IMF’s lending capacity.

The European Union has since committed an additional  €50bn to the Fund’s expanded New Arrangements to Borrow.
The signing of the agreement with the Bank of Finland means the Fund can now add these resources to those already available through agreements signed with other members.

These agreements contribute toward an increase in Fund resources that was requested in April 2009 by G-20 leaders and the International Monetary and Financial Committee in order to provide timely and effective balance of payments assistance to its members in the current crisis.

In another development, the Swiss National Bank (SNB) and the International Monetary Fund (IMF) announced that they will jointly host a High-Level Conference on the Interna-tional Monetary System in Zurich on May 11, 2010.

In the wake of the global crisis, this conference will provide an opportunity to exchange ideas on a number of related topics, including sources of instability in the international monetary system, improving the supply of reserve assets, dealing with volatile capital flows, and possible alternatives to countries’ accumulation of reserves as self-insurance against future crises.

The conference will bring together a group of high-level participants, including central bank governors, other senior policymakers, leading academics, and commentators.

The key objective of the conference is to examine weaknesses in the current international monetary system, and identify reforms that might be desirable over the medium to long run to build a more robust and stable world economy.

The event will be concluded with a joint press conference by SNB Governor, Philipp Hildebrand, and IMF Managing Director, Dominique Strauss-Kahn.


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