IMF board approves distribution of SDR1.75 billion
29 Sep 2012
The International Monetary Fund (IMF) has approved the distribution of the remaining 1.75 billion special drawing rights (SDRs), or $2.7 billion, of windfall profits from gold sales as part of a strategy to bolster its concessional lending to low-income member countries.
The resources are in addition to the SDR 700 million ($1.1 billion) approved for a similar but separate operation in February 2012, for supporting low income countries, the Washington-based global lender said in a statement yesterday.
According to Xinhua, with the latest decision, the IMF will be deploying the entire windfall profits gained from gold sales for lending to low-income members, which currently is at zero interest rate.
IMF managing director Christine Lagarde said this was a major step towards putting the IMF's important concessional lending operations for low-income members on a sustainable footing.
The IMF sold 403.3 tonnes of gold in 2009-10, under a plan that was meant to ensure the long-term financing of its day-to-day operations, through the creation of an endowment using anticipated profits of some SDR 4.4 billion ($ 6.8 billion).
The IMF has agreed to the distribution of the second part of a $3.8 billion windfall from gold sales to its 188 member countries, but on condition that countries direct most of the money to an anti-poverty loan programmes.