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International Monetary Fund. Strategy, Policy, & Review Department, International Monetary Fund. Finance Dept., and International Monetary Fund. Legal Dept.
To help support members faced with the COVID-19 pandemic, the Fund temporarily increased certain access limits to its emergency financing (EF) instruments, i.e., Rapid Credit Facility (RCF) and Rapid Financing Instrument (RFI). While this expanded support has been critical to help countries manage the pandemic, the increase in access limits was not applied to the Large Natural Disasters (LND) windows within the EF toolkit, reducing the flexibility to respond to such LNDs. This paper proposes to temporarily increase by 50 percent of quota the annual access limit (AAL) and cumulative access limit (CAL) under the LND windows of the RCF and RFI. The changes to the “LND windows” would be in effect through end-December 2021, in line with the other temporary changes of access limits under EF instruments. The case for further extensions to all the temporarily increased EF AALs and CALs will be examined after the 2021 Annual Meetings.
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Indicators, 2004–15 5. Access Limits, Norms, and GDP 6. Index of Quota Based RCF Annual Access Limits Relative to Economic Indicators, 2004–15 7. PRGT Credit Outstanding, 2009–16 8. Projected Total Commitments (midpoint PRGT + GRA), 2016–36 9. Number of PRGT-Eligible Countries: Blenders and Non-Blenders, 2015–37 10. Index of Quota Based GRA Access Limits Relative to Economic Indicators for Emerging Market and Developing Economies, 2004–15 11. PRGT Demand Projections TABLES 1. RCF/RFI Access and GDP Impact of Shocks 2. Current Interest Rate Mechanism

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-of-payments needs. Many Directors agreed that, in blended cases, any purchases under the RFI should count toward the applicable RCF annual and cumulative limits to eliminate an anomaly in the current rules and guidelines that allows some PRGT-eligible countries to “double dip” in PRGT and GRA resources. Directors took note of the safeguards in place under the RCF and RFI to avoid Fund support of countries with continued weak policies and unwarranted diversion of demand away from upper credit tranche facilities. Some Directors cautioned about the risks of “facility shopping” and

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existing policies. Figure 6. Index of Quota Based RCF Annual Access Limits Relative to Economic Indicators, 2004–15 1/ Sources: WEO and Fund staff estimates. 1/ GDP-weighted index of EPCA/RCF-normal usage annual limit (25 percent of quota) and ENDA/RCF-shock window usage annual limit (50 percent of quota) in relation to demand indicators. 2/Gross financing needs are defined as the current account deficit excluding grants, amortization payments, arrears clearance, and change in reserves. 12. Reflecting continued use of concessional financing, some

International Monetary Fund
The COVID-19 pandemic is taking a human toll and has unleashed a series of shocks on the Fund’s entire membership, creating severe disruption in the global economic and financial system. As a result, many emerging market and developing country (EMDC) members face urgent and unprecedented financing needs, creating significant immediate demand for Fund resources. In order to respond to members’ large and urgent financing needs, the paper proposes to enhance the Fund’s emergency financing toolkit, through a temporary increase in access limits for both the Rapid Financing Instrument (RFI), available to all members, and the Rapid Credit Facility (RCF), available to Poverty Reduction Growth Trust-eligible members only. It is proposed to increase these access limits for a proposed period of six months, which may be extended by the Executive Board. A companion Board paper sets out proposals to accelerate Board consideration of member requests for financing under the RCF and RFI, completion of reviews and requests for changes in access in existing arrangements, and requests for grant assistance under the Catastrophe Containment and Relief Trust.
International Monetary Fund

/ Qualification for the RCF requires that the BoP difficulties that underlie the financing need are not predominantly caused by a withdrawal in financial support by donors. 3/ For RCF-RFI blends, purchases under the RFI count towards the applicable RCF annual and cumulative limits. Box 2. Staff Guidance on Addressing Governance Safeguards for Emergency Financing Policy commitments in emergency financing requests (RCF/RFI) seek to limit the risk of misuse of Fund resources . Catastrophes create opportunities for corruption, exacerbated by weaker controls. Such misuse

International Monetary Fund. Strategy, Policy, & Review Department, International Monetary Fund. Finance Dept., and International Monetary Fund. Legal Dept.

these RCF sub-ceilings is provided for under the “LND window” when damage from a natural disaster is assessed to be equivalent to or exceed 20 percent of the member’s GDP. 2 , 3 In such a case, RCF annual and cumulative limits are 80 percent of quota and 133.33 percent of quota, net of scheduled repayments. RFI financing . Assistance under the RFI is available to all member countries meeting the qualification requirements. Pre-pandemic access was subject to an AAL and a CAL of 50 and 100 percent of quota, respectively. Like the RCF, these access limits are

International Monetary Fund
The temporary increase in access limits under IMF emergency financing instruments will expire on October 5, 2020, unless extended. Access limits under emergency instruments (the Rapid Credit Facility (RCF) and Rapid Financing Instrument (RFI)) were increased in April 2020 for a period of six months, from 50 to 100 percent of quota annually and from 100 to 150 percent of quota cumulatively. The increased limits are subject to review and can be extended before their expiration. It is proposed to extend the period of higher access limits for emergency financing for a period of six months, through April 6, 2021. Against a background of continued pandemic-related disruption, staff expects there could be significant demand for emergency lending in the October 2020–April 2021 period, including from countries with pending requests and from countries that received emergency support at levels less than the maximum amounts available. A six-month extension would give more time for countries to benefit from higher access limits under emergency financing.
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damage threshold of 30 percent of GDP, projected additional PRGT loan demand is projected in the annual range of SDR 11–27 million, a figure that would rise to SDR 16–41 million for a damage threshold of 20 percent of GDP. For lower disaster damage thresholds, the additional PRGT loan demand would rise further—for example, to SDR 23–59 million for a threshold of 10 percent of GDP. Table 4. New PRGT Loan Demand Based on Higher RCF Annual Access Limits Disaster damage threshold No threshold 10% of GDP 20% of GDP >30%of GDP

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cumulative access limit of RCF and comparable access limits for the nonconcessional facility for emergency assistance to permit more extended use when warranted. In 2013 the RCF annual/cumulative limit was increased from 25/75% of quota to 25/100% of quota; and in case of a sudden exogenous shock, it was increased from 50/100% to 50/125% of quota. Greater flexibility built into program design to reflect better the limited implementation capacity of FS and the need to deliver “quick wins” to population. While the majority of mission chiefs find themselves and