IMF wants ability to tap financial markets

WASHINGTON: The International Monetary Fund has asked member nations to consider allowing it to borrow directly from financial markets in time of severe crisis, according to an document published Thursday.

"There may be circumstances where it is either necessary, or preferable on effectiveness grounds, to augment significantly the Fund's own resources," the IMF said in a report dated March 23.

"While in 2009-2010 it was possible to do so by turning to member countries, the process took time and may not always be politically feasible," it said.

Instead, establishing the means to borrow from the markets at short notice to supplement its existing resources "could be worth exploring," it said.

The publication of the report came one day after Portugal, struggling with a debt crisis, said it would seek aid from the European Union. On Thursday, Portugal still had not approached the IMF for assistance.

In the middle of the global financial crisis in 2009 the IMF sought to triple its resources to broaden lending capacity.

While it was able to garner pledges from the Group of 20 major economies, it only managed to meet that goal in March this year.

The "usable resources" of the crisis lending account for medium and high-income countries today totals $671 billion, the highest level since the IMF was founded more than 60 years ago.