About IMF's Stand-By Arrangement:
- It provides short-term financial assistance to countries facing balance of payments problems. Historically, it has been the IMF lending instrument most used by advanced and emerging market countries.
- Eligibility: All member countries facing actual or potential external financing needs. Most often used by advanced and emerging market countries, but low-income countries sometimes use the SBA together with the Standby Credit Facility (SCF).
- Conditionality
- Countries’ economic policies must address the problems that led the country to seek funding.
- Disbursements conditional on the observance of quantitative performance criteria.
- Progress in implementing structural measures that are critical to achieving the objectives of the program is assessed in a holistic way, including via benchmarks.
- Duration of the assistance: Typically covers a period of 12–24 months, but not more than 36 months.
Key facts about IMF:
- It fosters economic growth and employment by providing temporary financial assistance to countries to help ease the balance of payments adjustment and technical assistance.
- Foundation: Formed in 1944 at the Bretton Woods Conference with the goal of reconstructing the international monetary system.
- Important Reports:World Economic Outlook and Global Financial Stability Report
- Headquarters: Washington, DC, USA.
