The International Monetary Fund (IMF) will discuss the possibility of modifying the fees charged to its largest debtor countries. This is due to some countries claiming that costs have increased due to rising interest rates. The IMF Executive Board, consisting of 190 members representing 24 countries, convened a meeting today to consider proposals for reducing additional fees.
These additional fees are required if a country exceeds its borrowing limit or requests an extension of repayment period for IMF programs. In April, the fund announced that its Executive Board would consider this matter during the summer and propose possible solutions to address these changes, their impact on borrowers, and risk management for the fund.
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Any policy changes require approval from at least 70% of the board members. It is not expected that a final decision will be made this week, as preliminary reviews will be completed during this meeting.
Reasoning behind the IMF
‘s additional fees is that they are central to its financial model, including preventing excessive borrowing and overdue payments. However, according to borrowers, these fees deplete funds needed for essential services such as food and healthcare; they have become even more challenging with rapid inflation and higher interest rates. The United States has expressed willingness to consider a review of these fees, which is seen as significant as it is one of the main donor countries to the IMF.
