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IMF creates instrument to help countries cope with “food shock”

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The International Monetary Fund (IMF) announced a new credit instrument to quickly help countries facing a situation of “acute food insecurity” amid high global inflation.

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In this way, the new Food Shock Window will provide additional access to emergency financing “to help people in vulnerable countries deal with one of the worst crises of all: hunger.”

In a statement, the managing director of the IMF, Kristalina Georgieva, maintained that climate shocks, wars, and the COVID-19 pandemic have disrupted food production and distribution, “increasing the cost of feeding people.”

“Russia’s war in Ukraine pushed up the price of food and fertilizer even more. As a result, a food crisis is spreading across the world with a record 345 million people whose lives and livelihoods are in immediate danger from acute food insecurity,” Georgieva warned.

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According to Georgieva, The new instrument, which will operate for one year, can be used when grants and concessional financing from partners are not sufficient, or a Fund-supported program is not possible.

It is part of two emergency programs created by the IMF to help countries deal with the impacts of the pandemic. The first is the Rapid Credit Service, which provides interest-free loans for up to 10 years for the poorest countries; and the second is the Rapid Financing Instrument, which is for richer economies and must be repaid in a maximum of five years.

With information from the AFP Agency.

Source: Gestion

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