Drawings on IMF resources by member countries rose to a record level of SDR 21.5 billion ($29.2 billion) during 1998, as countries sought the IMF’s financial support to help them tackle the impact ofthe prevailing global economic crisis (see chart, right, and table, page 77). The volume of this assistance easily outstripped the previous record of SDR 18.4 billion ($25.0 billion) set in 1995 and was an increase of almost SDR 5 billion ($6.8 billion) over the SDR 16.8 billion ($22.8 billion) drawn in 1997. The sharp increase in lending was primarily a response to the urgent needs of the countries affected by the global crisis as the IMF continued in 1998 to provide large amounts of financial support for the adjustment programs of Indonesia, Korea, and Thailand. The IMF also acted to support economic programs in the Russian Federation, in August 1998, and Brazil, in December 1998.
Data: IMF Treasurer’s Department
The spread of the crisis led to drawings from the IMF by Korea, SDR 5.9 billion ($8.0 billion); Indonesia, SDR 4.3 billion ($5.8 billion); Russia, SDR 4.6 billion ($6.3 billion); and Brazil, SDR 3.4 billion ($4.76 billion). The arrangements with Korea, Russia, and Brazil included amounts drawn under the Supplementary Reserve Facility, which was established in December 1997 (IMF Survey, January 12,1998, page 7). Drawings by the four countries amounted to over 57 percent of total IMF disbursements during 1998.
Stand-By Arrangements accounted for most of IMF lending during 1998, totaling SDR 12.1 billion ($16.5 billion) by year’s end. Of this amount, SDR 2.9 billion ($3.9 billion) represented funds that the IMF borrowed from participants in the New Arrangements to Borrow and disbursed under the Supplemental Reserve Facility. SDR 6.3 billion ($8.4 billion) was disbursed under the Extended Fund Facility, while member countries drew SDR 0.9 billion ($1.2 billion) under the Enhanced Structural Adjustment Facility. The Compensatory and Contingency Financing Facility registered the largest increase in disbursements, rising from SDR 0.1 billion ($0.13 billion) in 1997 to SDR 2.2 billion ($3.0 billion) in 1998, owing entirely to a large drawing by the Russian Federation.
On December 31, 1998, the IMF had Stand-By, Extended Fund Facility, or Enhanced Structural Adjustment Facility Arrangements (the principal IMF lending facilities) with 62 member countries. The cumulative amount approved under these facilities was SDR 61.2 billion ($83.2 billion), an increase of 37 percent over the previous year’s total. Of the 1998 amount, SDR 32.9 billion ($44.7 billion) was approved under Stand-By Arrangements, SDR 24.4 billion ($33.2 billion) under Extended Fund Facility Arrangements, and SDR 3.9 billion ($5.3 billion) under Enhanced Structural Adjustment Facility Arrangements. Of the SDR 61.2 billion approved, the undrawn balance on December 31, 1998, amounted to SDR 29.4 billion ($40.0 billion).