Home » National Bank to Provide Millions of Euros to the IMF
Economy General News Hungary News

National Bank to Provide Millions of Euros to the IMF

The Hungarian National Bank plans to contribute nearly EUR 14 million to the Poverty Reduction and Growth Trust of the International Monetary Fund (IMF) through a targeted investment. This was announced by the National Bank Vice President Barnabás Virág at the joint IMF – World Bank Annual Meetings in Marrakesh, Morocco.

One of the central topics of the meeting, held between October 9-15, was global poverty reduction. The IMF’s fight against deprivation is primarily pursued through a specific financing instrument, the Poverty Reduction and Growth Facility. The fund provides loans to low-income and highly indebted developing countries.

The global shocks of recent years have hit the world’s developing economies particularly hard, requiring greater financing capacity from the IMF, says the latest statement of the National Bank. The Fund’s Managing Director Kristalina Georgieva has launched several fundraising campaigns targeting countries with strong and stable economic fundamentals, and Hungary has also received a request. In response to the request, the Hungarian National Bank, as the institution primarily responsible for all tasks related to Hungary’s membership in the IMF, has assessed the possibility of the contribution from a legal, liquidity, and credit risk perspective.

In light of these considerations, it has decided to make a contribution of SDR 11 million (the currency of the members of the IMF, freely usable on demand) through the profits of a specific investment deposited with the IMF.

Hungary’s contribution is historic not only by domestic standards, but also in the sense that it will be the largest contribution to the fundraising campaign among the emerging countries of the European Union, the bank stressed.

The statement pointed out that the IMF, together with the World Bank, plays an indispensable role in helping low-income countries, as the Bretton Woods institutions’ historic mission is to eradicate poverty.

Hungary, as a former participating country in the program, is making its first appearance as an investor,

the National Bank wrote, noting that relations between Hungary and the IMF have been developing steadily in recent years. Another milestone is that Hungarian authorities can now provide funds for IMF objectives, the Hungarian bank concluded.

Source : Hungary Today