Norway asks Parliament to approve IMF loan

The Norwegian Government today issued a proposition in which parliament is requested to consent to a new bilateral loan agreement between Norges Bank and the International Monetary Fund (IMF). The agreement will contribute to the IMF’s resources through a loan of up to 6 billion SDR, equivalent to 7.1 billion euros or 9.2 billion US dollars.

-Many of Norway’s trading and cooperation partners are in a difficult economic situation. Unemployment is high in many countries, in particular among youth. A strong effort is required to create new growth and employment, says Finance Minister Sigbjørn Johnsen.

- A broad international agreement to strengthen the IMF’s lending capacity is in place. Norway is pleased to participate. We have a strong interest in securing international economic and financial stability, as well as significant international reserves, says Johnsen.

On April 21, the International Monetary and Financial Committee, IMFC, agreed to substantially increase the IMF’s lending capacity though new bilateral loan agreements. So far, IMF staff has received pledges totaling more than 430 billion dollars from over 30 countries. This will help ensure that the IMF has sufficient resources to meet the financing needs of the membership in a situation with considerable uncertainty about global economic prospects.

The Norwegian bilateral loan will be extended to the IMF’s general resource account. The funds will therefore be available for all member countries of the IMF, and not earmarked any particular region or group of countries. Norway’s total lending commitments to the IMF will be roughly doubled.