IMF Said to Be Discussing Activation of $583 Billion Crisis Lending Pool
IMF Managing Director Dominique Strauss-Kahn
Norman Ng/Bloomberg
Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF).
Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF). Photographer: Norman Ng/Bloomberg
March 24 (Bloomberg) -- Mark Dow, portfolio manager at Pharo Management LLC, and Mark Grant, managing director at Southwest Securities Inc., talk about European debt markets. They speak with Carol Massar and Matt Miller on Bloomberg Television's "Street Smart." (Source: Bloomberg)
March 24 (Bloomberg) -- Bonnie Baha, a money manager and head of the global developed-credit group at DoubleLine Capital LP, talks about the outlook for Portugal's economy and fiscal policy. Baha talks with Lisa Murphy on Bloomberg Television's "Bottom Line." (Source: Bloomberg)
March 24 (Bloomberg) -- David Blanchflower, professor of economics at Dartmouth College, talks about the likelihood of a European bailout for Portugal and the need to stop the spread of the region's sovereign debt crisis. Portugal moved closer to external aid after Prime Minister Jose Socrates’s offer to resign left his government in limbo on the eve of today’s European Union summit to address the crisis. Blanchflower talks with Margaret Brennan on Bloomberg Television's "InBusiness." (Source: Bloomberg)
The International Monetary Fund is working on activating its crisis lending pool, a move aimed at showing it has enough liquidity to help bail out countries in need and stabilize the global economy, two IMF officials said.
Countries that contribute to the pool, with new members including China and India, are seeking an agreement on how much of the credit line’s $583 billion should be made available and for how long, according to one official, who spoke on condition of anonymity because the talks are not public.
The talks are taking place as Europe’s debt crisis deepens, with the resignation of Portugal’s Prime Minister Jose Socrates stoking concern the government is moving closer to seeking a bailout. The activation of the so-called New Arrangement to Borrow would leave the IMF, which has helped rescue countries including Greece and Ukraine over the past two years, with ample resources if more European countries need help.
IMF Managing Director Dominique Strauss-Kahn requested the activation about two weeks ago, the officials said, when an expansion of the pool was ratified, fulfilling an April 2009 pledge by Group of 20 countries to boost IMF resources.
The activation may take place as early as next week, one official said. The aim is to have it running for the institution’s spring meetings April 16-17, the other official said.
IMF spokesman William Murray in an e-mail said the activation “is just a natural consequence of ratification” of the pool.
To contact the reporter on this story: Sandrine Rastello in Paris at srastello@bloomberg.net
To contact the editor responsible for this story: Christopher Wellisz at
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