Norges Bank and the International Monetary Fund sign agreement on financial support for the IMF
In a letter of 12 March 2009 to the Ministry of Finance, Norges Bank proposed that Norway should hold discussions with the International Monetary Fund (IMF) on the possibility of a drawing arrangement for the Fund. The purpose of the proposed arrangement was to ensure that the Fund has sufficient lending capacity to assist countries experiencing balance of payments problems.
Following negotiations between the Fund and Norges Bank, the Government presented the matter to the Storting (Norwegian parliament). The Storting approved the agreement between Norges Bank and the Fund on 15 June under which new lending resources may be made available for use under the Fund’s general lending facilities.
The main element of the agreement is that Norges Bank will provide a borrowing facility in the form of a drawing arrangement of up to SDR 3 billion, or just under NOK 30 billion. The borrowing agreement will be effective for five years.
The Economic Commentary “The IMF in change – loan from Norges Bank” describes how the Fund’s role has changed and explains why Norway has provided a loan to the Fund.