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Coronavirus: IMF may need to step outside comfort zone, says Georgieva

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The IMF may need to step outside its comfort zone and consider “exceptional measures” to help countries deal with the coronavirus pandemic and mitigate its economic impact, Managing Director Kristalina Georgieva said on Monday.

Georgieva, in a blog published on the International Monetary Fund's website, said the Fund had already taken extraordinary steps to free up resources, especially for emerging markets and developing economies that have seen an outflow of $100 billion in recent months - the highest on record.

But more resources might be needed if market pressures continued to mount, and lending - even on easy terms - was not always the best solution, given already high debt burdens faced by many countries, she said.

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“The IMF, like our member countries, may need to venture even further outside our comfort zone to consider whether exceptional measures might be needed in this exceptional crisis,” she said, suggesting solutions could include increased collaboration with other international institutions and the private sector.

Georgieva gave no details, but her remarks come after a joint IMF-World Bank paper published on Friday said a broader group of countries - beyond the 77 poorest countries that have already been promised a suspension in debt payments on official bilateral loans - may need debt relief.

Georgieva also revived her call for a possible allocation of Special Drawing Rights (SDRs), its currency, a step that has been opposed by the United States. An SDR allocation is akin to a central bank "printing" new money.

Read more: Coronavirus: IMF, World Bank call for action to cover $44 bln gap in Africa's needs

The IMF last forecast the global economy would contract by 3 percent in 2020 due to the pandemic, marking the steepest downturn since the Great Depression of the 1930s.

“We stand ready to deploy our full lending capacity and to mobilize all layers of the global financial safety net, including whether the use of SDRs could be more helpful, Georgieva wrote in the blog.

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