In May something strange happened but it went by barely unnoticed by the rest of this planet. Regional leaders in Asia agreed on a 120 billion USD emergency fund to counter the crisis. This fund was set up by the Asian Development Bank with his 67-members, in fact bypassing the IMF. Don’t forget that the IMF is de facto an United States driven institution, but that the US is also an important member of the ADB.
In the mean time we hear that the talks between Latvia and the IMF are not progressing at all. The IMF tries to play hardball.
While the EU is much more cooperative in finding solutions for the Latvian problem.
From the FT:
Although the Latvian Parliament did approve the announced budget cuts on Tuesday this week, the IMF response posted on its official website was rather lukewarm, suggesting that the measures were still not enough for the IMF to feel comfortable enough to continue the support of the Latvian peg with its own money.
Typically, the EU disbursements have followed those of the IMF in the sense that the EU left the IMF in charge of “managing” the programmes (ie, undertaking the economic assessments) and then would disburse its funds following the completion of IMF reviews. For example, this has been the practice in Romania and Hungary. Now it seems that in Latvia this IMF-EU cooperation could break down, with the IMF declining to conclude its review even though the EU wants to make its own disbursement.
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In the mean time we hear that the talks between Latvia and the IMF are not progressing at all. The IMF tries to play hardball.
While the EU is much more cooperative in finding solutions for the Latvian problem.
From the FT:
Although the Latvian Parliament did approve the announced budget cuts on Tuesday this week, the IMF response posted on its official website was rather lukewarm, suggesting that the measures were still not enough for the IMF to feel comfortable enough to continue the support of the Latvian peg with its own money.
Typically, the EU disbursements have followed those of the IMF in the sense that the EU left the IMF in charge of “managing” the programmes (ie, undertaking the economic assessments) and then would disburse its funds following the completion of IMF reviews. For example, this has been the practice in Romania and Hungary. Now it seems that in Latvia this IMF-EU cooperation could break down, with the IMF declining to conclude its review even though the EU wants to make its own disbursement.
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