Poland applies for $20bn credit line from IMF

2009-04-16



Poland will ask the International Monetary Fund (IMF) for a $20.5bn credit line under the Fund’s new Flexible Credit Line (FCL) facility, finance minister Jacek Rostowski announced on 14 April.
The money will be used to increase the foreign-currency reserves of NBP, the central bank, thus boosting the country’s defences against uncontrolled currency devaluation through speculative attacks. According to Rostowski, it will also improve Poland’s access to commercial lending and reduce its debt-servicing costs. The market reacted enthusiastically, with the zloty gaining significantly against the euro.
Rostowski stressed that accessing the IMF’s facility was evidence of the country’s success in coping with the downturn. That is because the FCL is designed for stable economies with strong fundamentals. It offers access to credit with few strings attached, and is to be distinguished from emergency loans provided to countries in danger of default, which come with strict conditions such as public finance reform.