The government of Rwanda has requested an additional disbursement of S433 million from the International Monetary Fund (IMF) to respond to COVID-19 economic fallout, the Fund said in a statement on Thursday.
The request was made under the Rapid Credit Facility (RCF) arrangement to help address the urgent balance of payments (BOP) need arising from the pandemic, currently estimated at about USD $433 million.
The Rapid Credit Facility provides rapid concessional financial assistance with limited conditionality to low-income countries (LICs) facing an urgent balance of payments need.
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The RCF was created under the Poverty Reduction and Growth Trust (PRGT) as part of a broader reform to make the Fund’s financial support more flexible and better tailored to the diverse needs of LICs, including in times of crisis. The RCF places emphasis on the country’s poverty reduction and growth objectives.
IMF had said the COVID-19 has had a severe economic impact on Rwanda through the implementation of strict domestic measures to contain the spread of the virus and related global spillovers.
IMF said ehe Rwanda authorities have responded to COVID-19 by deploying health and economic measures totaling USD $311 million. They have also set up an economic recovery fund to support firms affected by the pandemic.
“To help address the urgent balance of payments (BOP) need arising from the pandemic, currently estimated at about USD 433 million, the authorities request an additional disbursement under the Rapid Credit Facility (RCF) of 50 percent of quota (SDR 80.1 million) under the “exogenous shock” window of the RCF.
“This follows the Executive Board’s approval on April 2, 2020 of the authorities’ earlier request for the same amount, before the doubling of the annual access limit of emergency financing under the “exogenous shock” window of the RCF to 100 percent of quota on April 9, 2020. This additional request will bring the total disbursement under the RCF to 100 percent of quota,” IMF wrote in the statement announcing the request for additional disbursement.