Questions and Answers

December 18, 2023

These Q&As cover questions about the 16th General Quota Review. For additional background and basic facts about IMF Quotas please refer to this factsheet.

Q1. Where do IMF resources come from?

  1. Permanent resources: these are derived from members’ quota subscriptions and constitute the primary source of IMF funding. Quotas are the building blocks of the IMF’s financial and governance structure, as they:

    1. determine the maximum amount of financial resources a member is obliged to provide to the IMF,
    2. are a key determinant of voting power in IMF decisions,
    3. determine the maximum amount of loans a member can borrow from the IMF under normal access, and
    4. determine a member’s share in a general allocation of SDRs.

  2. Temporary resources: While permanent or quota resources are the IMF’s primary source of financing, the IMF is authorized to supplement them through borrowing if needed to meet members’ needs. Borrowing arrangements in place include:

    1. New Arrangements to Borrow (NAB) are between the IMF and a group of members and institutions (participants). These constitute the second line of defense after quota resources. Currently (as of December 15,2023), 40 NAB participants contribute an aggregate amount of SDR 364 billion (USD 489 billion) to the Fund’s total resource envelope.
    2. Bilateral borrowing agreements (BBAs) are between the IMF and individual member countries. These constitute the third line of defense after quota resources. Currently, bilateral borrowing agreements with 42 creditors are in place for a total of SDR 141 billion (USD 189 billion).

Q2. When will the quota increase under the 16th GRQ become effective?

The resolution for the 16th General Review of Quotas includes two general effectiveness conditions:

  1. The first condition is that no quota increase under the 16th Review can become effective unless members currently having not less than 85 percent of total quotas have consented in writing to the increases in their quotas. The resolution sets the deadline for the Fund to receive members’ consents as November 15, 2024. The Executive Board may extend this deadline as it may determine.
  2. The second condition is that no quota increase under the 16th Review can become effective unless participants in the New Arrangements to Borrow (NAB) have provided consents necessary for the effectiveness of the NAB rollback.  

Once the above general conditions are met, a member’s quota increase will be in effect after that member has provided its consent to, and paid for, its quota increase.

Q3. When is the consent to (and payment of) quota increases under the 16th Review envisaged?

The resolution sets the deadline for the Fund to receive members’ consents as November 15, 2024. The Executive Board may extend this deadline as it may determine. Payments of quota increases are due within 35 days after the later of (i) the date on which the member notifies the Fund of its consent; or (ii) the date on which the general effectiveness conditions are met.

Q4. Why is a NAB rollback needed under the 16th GRQ?

The Board of Governors’ resolution envisages maintaining the Fund’s lending capacity. To achieve this, the increase in permanent or quota resources will be offset by a commensurate decrease in temporary or borrowed resources through a NAB rollback and the phasing out of Bilateral Borrowing Agreements.

Q5. When is the NAB rollback under the 16th GRQ envisaged?

Staff will consult with NAB participants on the rollback soon and expects that a proposal could be considered by the Executive Board in early 2024. This proposal would then be submitted to NAB participants for their consent.

Q6. Given the recent increase in access limits, does the increase in quotas automatically allow member countries to borrow more?

As indicated by staff during the review of access limits in early 2023, a comprehensive review of access is planned for 2024. This review will assess the GRA access limits in the context of the 16th General Review of Quotas. It is envisaged that in line with past practice, any proposed changes to the access limits would be proposed to become effective at the same time as the new quotas take effect. PRGT access limits were temporarily increased in December 2023, and will be reviewed in the context of the forthcoming Review of the Fund’s Concessional Facilities and Financing expected to be completed in the Fall of 2024 .