Chart of the Week: Do Climate-Exposed Countries Have IMF Programs?

By Amanda Brown

The International Monetary Fund (IMF) Executive Board meets today to consider the final design of the proposed Resilience and Sustainability Trust (RST). Designed to re-channel some of the $650 billion in Special Drawing Rights allocated last August, the RST has the potential to address a glaring gap in the international finance architecture as an unprecedented and vital financing instrument. However, its design matters greatly to its utility, and the IMF’s current proposal risks locking up billions in climate- and pandemic-fighting resources with restrictive access requirements and onerous conditionalities.

A new policy brief from the Task Force on Climate, Development and the IMF outlines five key design features to ensure an inclusive and effect RST. It highlights how many climate vulnerable countries seeking RST support would in fact be excluded from the RST due to requirements tying access to existing IMF programs.

This Chart of the Week, Figure 4 from the policy brief, demonstrates this gap:

The chart shows countries plotted on a scale of exposure to both low-carbon economy transition risks as well as climate-driven hazard and exposure risk. This gives an approximate reflection of how vulnerable each country’s economy is to the impacts of climate change. Additionally, many climate vulnerable countries do not have an existing IMF program, leaving them unable to access RST support. 

What is more, many existing IMF programs are not designed to tackle climate change, and adding RST resources to these programs might not be sufficient. Previous programs have been designed with fundamentally different objectives, and this will reduce the ability of the RST to help countries address the climate crisis in a meaningful way. The addition of these minimal resources has no guarantee of any additional impact on existing climate efforts.

To ensure the RST has transformational impact, the Task Force recommends broadening eligibility and scope, providing concessional terms, prioritizing country ownership, ensuring collaborative governance and building to scale with self-replenishment mechanisms to guarantee sustainability. 

In light of the Intergovernmental Panel on Climate Change’s latest report, the time to invest in net-zero, resilient economies is now, and the RST can play a transformative role in that effort if it is designed with such ambition in mind. 

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