IMF needs less new money for crisis than previously thought

WASHINGTON - Agence France-Presse

IMF chief Christine Lagarde speaks at the Brookings Institution in Washington, DC, April 12. The IMF has said it needs some $500 billion. Abacapress photo

The International Monetary Fund said it probably needs less new money for crisis intervention than previously thought, crediting action by the eurozone for the change.

“The needs now may not be quite as large as we had estimated earlier this year. It’s only because action was taken by the European institutions,” IMF chief Christine Lagarde said on April 11 in a Washington speech. Lagarde comments come a week before the IMF and the G20 finance ministers and central bankers hold meetings, with a key aim of boosting the IMF’s resources for intervening in financial crises.

With the European economy on the brink, for months the Fund has said it needs some $500 billion in ready funds, and has asked member states to say how much they could put up. In December the euro area itself offered 150 billion euros for the funding round.

But the United States, the IMF’s largest shareholder, has indicated it will not participate. Lagarde stressed the continued need to collect funds, even if the amount is less than expected. “To be as effective as possible, we need to increase our resources,” Lagarde insisted.