By Peter OBIORA InvestAdvocate
Lagos (INVESTADVOCATE)-The International Monetary Fund (IMF) on Wednesday said it has granted a one-year extension to countries under the 2012 borrowing agreements for a total of $441 billion.
The IMF said the agreements have played a key role in ensuring that the Fund has adequate resources to meet members’ potential needs in the event that tail risks were to materialise.
The Fund affirmed in 2012, a number of member countries committed to increase IMF resources through bilateral borrowing agreements.
According to the global lender, following its board’s approval of the modalities for the 2012 borrowing agreements, 35 agreements for a total of about $441 billion (SDR 288 billion) have been approved of which 32 agreements are now effective for a total of $425 billion (SDR 277 billion).
‘’The 2012 borrowing agreements are designed as a second line of defense after quota and New Arrangements to Borrow (NAB) resources and have so far not been activated for use in financing operations. Each agreement has an initial two-year term, and a maximum term of four years,’’ he IMF said.
The global financial institution said after this decision, which followed consultations with lenders, the initial two-year term of the agreements will be extended by one year.
