Poland: Request for a US$20 bn IMF Flexible Credit Line
Overview:
Throughout the global financial crisis the Polish authorities have sought to distance Poland in the eyes of investors from other countries in the region with weaker economic fundamentals. They have rightly pointed out that the dramatic weakening of the Polish Zloty is not justified by Poland’s relatively strong economic policies. Moreover, the authorities denied that Poland needed an IMF loan. Now, however, the reform of IMF lending facilities and development of a Flexible Credit Line (FCL) have given the authorities the opportunity to take advantage of IMF resources without the stigma and conditionality of a standard balance of payments support package. The FCL is available only to countries with sound existing economic policies as a form of insurance against emerging market contagion.