1. The IMF's Preferred Creditor Status: Does It Still Make Sense After the Euro Crisis?
- Susan Schadler
- Publication Date:
- Content Type:
- Policy Brief
- Centre for International Governance Innovation
- Throughout the history of IMF lending, the institution has had PCS — that is, distressed countries borrowing from the IMF are expected to give priority to meeting their obligations to the IMF over those to other (private or official) creditors. This status is a defining characteristic of the IMF's role in financial crises: it provides a high degree of confidence that IMF resources are safe even when other creditors of the distressed country face substantial uncertainty about whether they will be repaid in full. In other words, the IMF, which lends to some of the riskiest countries in the world, faces minimal risk that its resources could be compromised by a debtor country's difficulties in servicing its debt. It does so, however, with the confidence that comes from its role in helping to formulate and monitor a program of policies that are strongly expected to return the country to stability.
- Debt, Economics, International Monetary Fund, Monetary Policy, and Financial Crisis
- Political Geography: