IMF, ready to jump to the aid of affected countries

Kristalina Georgieva. Photo source: Jason Alden / Bloomberg.

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The International Monetary Fund is ready to help countries that could be affected by any side effects from the Russia-Ukraine conflict and sanctions imposed by Western governments, IMF Director Kristalina Georgieva said on Wednesday.

At a Washington Post event, Kristalina Georgieva said that sanctions will inevitably disrupt some financial transactions as well as the functioning of the financial system, especially if Russia’s access to the SWIFT financial transaction network will be restricted.

“If we find ourselves in a situation where there are side effects that require a greater commitment from the IMF to other countries, of course we will be there. We have a borrowing capacity of over $ 700 billion, “Kristalina Georgieva was quoted as saying by Digi24, which quotes Reuters.

However, the IMF director expressed hope that a diplomatic solution will be found to this crisis, which already has an impact on energy prices and poses a threat to global growth. Georgieva recalled that the IMF has $ 2.2 billion in the loan program with Ukraine, the money that can be distributed from now until June, and is ready to provide additional assistance if needed, both for Ukraine and other countries affected by the conflict. The IMF will help assess the impact of any conflict and make recommendations to member states as the crisis progresses.

On the other hand, the IMF director appreciated that the COVID-19 pandemic remains the main risk to the world economy and already contributes to rising inflation in many countries.

In this context, Georgieva called for increased efforts to increase vaccination and strengthen the defense against coronavirus, stressing that these efforts will help the economy recover faster and counter inflation.

On the subject of inflation, the head of the IMF acknowledged that it turned out to be “a more important economic and social problem” than expected, adding that economists underestimated the impact of delayed consumption and climate shocks on food prices.