Member countries of the International Monetary Fund (IMF) agreed today, Saturday, to a "significant increase" in the fund's lending resources by the end of the year, while IMF Managing Director Kristalina Georgieva warned that "the conflict between Israel and Gaza is increasing global economic uncertainty." Georgieva stated in a press conference that the severity of the conflict became apparent during the discussions at last week’s IMF and World Bank meetings, where the situation evolved from attacks on "innocent civilians" in Israel to the "necessity of finding ways now to prevent civilian casualties in Gaza."
She added, "I can say that the shock felt by people was evident during our meetings," noting that it is too early to assess the impact of the conflict on the global economy. She remarked that "what we are seeing, of course, is recognition that this is another source of uncertainty," adding that much will depend on the scale and duration of the conflict.
In a press conference following the IMF steering committee meeting, committee chair Nadia Calvino did not disclose the conditions for increasing funding quotas but stated that the conditions would ensure that the fund can maintain global financial stability. A source familiar with the discussions indicated that the final wording of the statement is still under negotiation. It remains unclear whether the international financial and monetary committee will support a broadly backed U.S. plan for countries to contribute new funds in line with their existing quotas, which could postpone any gains for China and other rapidly growing emerging markets.
Calvino, whose term as chair of the steering committee is nearing its end, indicated that there is a consensus on "core issues."
