December 23, 2024
PRESS OFFICER: Randa Elnagar
Phone: +1 202 623-7100Email: MEDIA@IMF.org
Washington, DC - December 17, 2024: The Executive Board of the International Monetary Fund (IMF) concluded the Comprehensive Review of the General Resources Account (GRA) Access Limits.
The last comprehensive review of the Fund’s GRA access limits took place in February 2016, establishing an annual limit of 145 percent and a cumulative limit of 435 percent of quotas. These limits were adjusted temporarily during the COVID-19 pandemic and after the geopolitical conflicts of recent years.
The Board adopted a decision to set limits on overall annual and cumulative access to GRA resources at 200 and 600 percent of current quotas, respectively. This maintains stability and predictability relative to the current temporary overall access limits, which were approved in March 2023, extended in March 2024, and set to expire at end-2024.
The Board also adopted decisions to ensure that the nominal special drawing rights (SDR) value of the overall GRA access limits, instrument-specific limits, other quota-based thresholds, and the Resilience and Sustainability Trust (RST) quota-based limits will be maintained once the general conditions for the effectiveness of the quota increase under the 16th General Review of Quotas (GRQ) are met. The limits and thresholds in percent of quota will be reduced by one-third (or divided by 1.5), with some being rounding up, following a similar approach endorsed by the Executive Board in the recent Review of Charges and the Surcharge Policy and the Review of PRGT Facilities and Financing. This will ensure stability of access limits, clarity for Fund-supported programs, as well as simplicity and consistency within the Fund’s lending toolkit.
The next Comprehensive Review of GRA Access Limits is expected to take place on the standard five-year review cycle, with flexibility to conduct it earlier if circumstances warrant.
Executive Board Assessment[1]
Executive Directors welcomed the Comprehensive Review of General Resources Account (GRA) Access Limits. They emphasized that access limits are a key element of the Fund’s risk management framework, providing members with confidence about the possible scale of financing that the Fund is prepared to provide in support of their adjustment efforts, while safeguarding Fund resources and preserving their revolving character. Access in individual financing requests is determined by rigorous assessments informed by standard access criteria, including balance of payments need, the strength of the member’s program, capacity to repay the Fund, and outstanding credit to the Fund. In that context, Directors took note that overall GRA access limits are not ceilings but thresholds for enhanced scrutiny and safeguards.
Directors broadly supported the proposal to set the limits on overall GRA annual and cumulative access at 200 and 600 percent of current quotas, respectively, and keep other access limits and quota based thresholds largely unchanged. The decision preserves the current temporary access limits that are set to expire at end 2024. Most Directors concurred that the proposed overall access limits strike an appropriate balance between offsetting a significant portion of the erosion vis à vis macroeconomic aggregates since the last comprehensive review in 2016 and maintaining risk mitigation safeguards. However, while willing to go along with the broad consensus, a number of Directors expressed their preference for higher overall GRA access limits to fully compensate for the erosion.
Directors broadly supported the proposal to automatically adjust the overall GRA access limits, the GRA instrument specific limits, other quota based thresholds, and the quota based Resilience and Sustainability Trust limits when the general conditions for the effectiveness of the 16th General Review of Quota (GRQ) increase are met. They concurred that the limits and thresholds will be divided by 1.5, with some limits and thresholds being additionally rounded up for simplicity and ease of communication. This approach broadly aligns with those adopted in the recent Review of Charges and the Surcharge Policy as well as the Review of PRGT Facilities and Financing. However, many Directors raised concerns about the risk of a prolonged delay in meeting the conditions for the effectiveness of the 16th GRQ, which could exacerbate the erosion of access limits in real terms. Should such a delay materialize, a number of Directors recommended taking appropriate corrective action.
Directors agreed that the next Comprehensive Review of GRA Access Limits should take place on the standard five year review cycle, with flexibility to conduct reviews earlier if circumstances warrant.
[1] At the conclusion of the discussion, the Managing Director, as Chair of the Board, summarizes the views of Executive Directors, and this summary is transmitted to the country's authorities. An explanation of any qualifiers used in summings up can be found here: http://www.IMF.org/external/np/sec/misc/qualifiers.htm.
