The International Monetary Fund Monday said that Colombia is seeking a
10.4 billion dollar credit line as a precautionary step to cope with
the global financial and economic crisis.
Under the IMF’s new credit scheme designed to throw a cash lifeline
to countries hit by the global economic crisis, Colombian authorities
are seeking a one-year arrangement for 900 percent of its quota, or
about 10.4 billion dollars, IMF managing director Dominique
Strauss-Kahn said in a statement.
“I welcome the announcement by
finance minister Oscar Ivan Zuluaga and central bank governor Jose
Dario Uribe that Colombia is interested in a one-year precautionary
arrangement under the IMF?s Flexible Credit Line (FCL),” Strauss-Kahn
said.
“I am very pleased by this positive response to the
invitation I extended to strongly performing economies to use this new
instrument to bolster international confidence on the strength and
sustainability of their policy framework.”
Strauss-Kahn said he intended “to move ahead rapidly” in seeking IMF executive board approval of the request.
Colombia
joins Poland in requesting a line of credit from the 185-nation IMF,
which launched its no-strings-attached FCL in late March to member
countries with strong economic track records.
Poland has requested a 20-billion-dollar line of credit under the FCL, which allows a country to draw funds at any time.
Mexico became the first to win approval for the new credit line Friday, gaining access to a record 47 billion dollars.
“Colombia
has a sustained record of sound economic policies, and has very strong
economic fundamentals and institutional and policy frameworks,”
Strauss-Kahn said.
“The Colombian authorities? have responded
appropriately to the global financial crisis, and have demonstrated a
commitment to maintaining this solid record,” he added.
The IMF’s
47-billion-dollar credit line to Mexico was the largest financial
arrangement in the 64-year-old institution’s history.
Mexico has
not had to tap the IMF for credit in a decade. The IMF said the credit
line was justified by Mexico’s strong track record of solid growth with
low inflation, steady reductions in public spending, a contained
deficit, strong corporate earnings and a well capitalized banking
system.
Last week the IMF forecast a prolonged, deep global recession, with recovery slow and difficult.
Other potential candidates for an IMF credit line are Brazil, Chile, South Korea, the Czech Republic and Singapore. (AFP)
