The International Monetary Fund is planning to raise at least $45 billion for a new trust fund to help “low-income and fragile middle-income countries” to address protracted challenges such as pandemics and climate change, the institution announced Wednesday.
The Washington-based Resilience and Sustainability Fund will go into effect on May 1, and will be added to the $650 billion in reserve assets or “special drawing rights” allocated earlier this year, reports a local Arabic daily.
“As the world faces successive global shocks, we must not lose sight of the critical actions needed today to ensure resilience and long-term sustainability,” IMF Managing Director Kristalina Georgieva said in a statement.
She explained that the goal of the new fund is to redistribute funds from the richest countries to the most fragile ones as members look to support the global economic recovery from the COVID-19 pandemic.
The IMF estimates that most of the IMF’s 190 members will be eligible to borrow from the new fund. The sources noted that the fund would require close cooperation with the World Bank and other international financial institutions.