The International Monetary Fund (IMF) has decided to tighten the screws on long-term lending, shortening duration of loan terms and levying higher interest.
The development is viewed as an attempt to mollify Washington, as it comes a month after the board rejected the US proposal to reconsider loan terms, delivering a rare rebuff to the largest shareholding government, a Washington Post report said.
The financial body is bowing to pressure from the United
States to limit its long-term lending, The Post said quoting
the (US) Treasury Department.
US Treasury Secretary Lawrence Summers said IMF will reduce the length of time granted to a country for repayment of loan under the core lending fund to period of 2.25 years to four years, down from the present 3.25 years to five years.
The IMF did not release the exact amendments made in its lending policy, but said its brief statement that the move represented an important step forward. It, however, said that extremely poor countries, especially African nations, will be not be brought under new policy terms.
Bureau Report
