The International Monetary Fund (IMF) approved a series of reforms on Friday, aimed at reducing borrowing costs for its member countries by 36 percent.
The changes, which will take effect on November 1, are expected to relieve financial pressure on eight heavily indebted nations.
The IMF’s executive board agreed to adjust the surcharges applied to countries with high levels of debt, such as Ukraine and Argentina.
These surcharges are additional fees that countries pay when their debt exceeds a certain threshold.
The reforms will raise this threshold, reducing the number of countries required to pay extra costs.
According to the IMF’s statement, the reforms will lift eight countries—Benin, Ivory Coast, Gabon, Georgia, Moldova, Senegal, Sri Lanka, and Suriname—out of the requirement to pay the additional borrowing costs.
The IMF estimates that only 11 countries will need to pay the surcharge under the new policy.
IMF Managing Director Kristalina Georgieva stated that the measures would lower borrowing costs for member countries by about $1.2 billion annually.
She emphasized that the consensus reached by the IMF’s membership was significant, especially given the current global economic challenges and high interest rates.
“In a challenging global environment and at a time of high interest rates, our membership has reached consensus on a comprehensive package that substantially reduces the cost of borrowing, while safeguarding the IMF’s financial capacity to support countries in need,” Georgieva said in her statement.
