NZ Agrees To Lend Up To US$1 Billion To IMF
NZ Agrees To Lend Up To US$1 Billion To
New Zealand has agreed to lend the International Monetary Fund (IMF) up to US$1 billion (NZ$1.34b) if the world faces another economic crisis like the 2008/09 global meltdown, Finance Minister Bill English says.
"New Zealand’s commitment is a part of the US$550 billion expansion of the IMF’s financial resources to make the IMF better able to support the international financial system during times of significant crisis," Mr English says.
The commitment will only be called upon if needed and only if the IMF has exhausted all other options.
"This is a clear way of showing that New Zealand is doing its part as a member of the international community. We are doing this to support and protect the global economy that New Zealand depends on to survive.
"This is part of a backstop arrangement. We don’t have to provide the funds now but this commitment does create a contingent liability for the Crown, which will appear on the Government's books later this year," Mr English says.
New Zealand is one of about 40 countries contributing to the IMF in this way. The contribution is in line with our economic size and similar to New Zealand’s other contingent liabilities to the IMF, which total US$1.4 billion.
Included in those liabilities is US$265 million lent to the IMF as part of a range of measures to help it support countries facing balance of payments problems caused by the global economic crisis.