Disbursements Total $29.2 Billion

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Page 65

IMF Lending in 1998 Reaches Record Levels As Members Tackle Effects of Global Crisis

Drawings on IMF resources by member countries rose to a record level of SDR 21.5 billion ($29.2 billion) during 1998, as countries sought the IMF's financial support to help them tackle the impact of the prevailing global economic crisis (see chart, right, and table, page 77). The volume of this assistance easily outstripped the previous record of SDR 18.4 billion ($25.0 billion) set in 1995 and was an increase of almost SDR 5 billion ($6.8 billion) over the SDR 16.8 billion ($22.8 billion) drawn in 1997. The sharp increase in lending was primarily a response to the urgent needs of the countries affected by the global crisis as the IMF continued in 1998 to provide large amounts of financial support for the adjustment programs of Indonesia, Korea, and Thailand. The IMF also acted to support economic programs in the Russian Federation, in August 1998, and Brazil, in December 1998.

[GRAPHICS ARE NOT INCLUDED]

The spread of the crisis led to drawings from the IMF by Korea, SDR 5.9 billion ($8.0 billion); Indonesia, SDR 4.3 billion ($5.8 billion); Russia, SDR 4.6 billion ($6.3 billion); and Brazil, SDR 3.4 Page 77 billion ($4.76 billion). The arrangements with Korea, Russia, and Brazil included amounts drawn under the Supplementary Reserve Facility, which was established in December 1997 (IMF Survey, January 12,1998, page 7). Drawings by the four countries amounted to over 57 percent of total IMF disbursements during 1998.

Stand-By Arrangements accounted for most of IMF lending during 1998, totaling SDR 12.1 billion ($16.5 billion) by year's end. Of this amount, SDR 2.9 billion ($3.9 billion) represented funds that the IMF borrowed from participants in the New...