WASHINGTON (Reuters) - The International Monetary Fund must improve its lending instruments for low-income countries, 72 of which it has provided with emergency funds during the coronavirus pandemic, its Managing Director Kristalina Georgieva said on Wednesday.
Georgieva told an online debt conference that emerging markets with strong fundamentals issued $124 billion in bonds in the first six months of 2020, but others with poor fundamentals had no affordable access to capital markets.
She said the Fund was working with member countries in advanced economies to shift some of their Special Drawing Rights - the IMF's own special currency - to low-income countries that had been particularly hard hit by the pandemic and its economic fallout.
Georgieva initially urged the IMF's 189 members to consider issuing new SDRs, something akin to a central bank printing money, a move backed by U.N. Secretary General Antonio Guterres and other world leaders.
But the United States, a key shareholder, and a few other countries have urged the IMF to focus on disbursing its current $1 trillion in lending power first before taking such a step.
Since then, IMF officials have been working to create a system for richer members to transfer or loan some of their SDRs to poorer countries. Details have not been released.
SDRs can be exchanged for freely usable currencies of IMF member states, and their value is based on a basket of five such currencies, including the U.S. dollar.
IMF loans are meant to help member countries tackle balance of payments problems, stabilize their economies and restore growth. But the fund is not classed as a development bank and does not finance projects.
(Reporting by Andrea Shalal; Editing by Chizu Nomiyama and John Stonestreet)