WASHINGTON -- The International Monetary Fund (IMF) said its board has approved an emergency $121 million disbursement to Kyrgyzstan to help the Central Asian nation deal with the COVID-19 pandemic, in what could be the first in a series of such moves.
Kristalina Georgieva, the IMF's managing director, said in a statement on March 26 that the “COVID-19 pandemic has been hitting the Kyrgyz economy very hard and created an urgent balance-of-payments need.”
“All sectors are being impacted with extreme severity as measures are being taken to stop the spread of the virus.
"The IMF support helps provide a backstop, increase buffers, and shore up confidence for the Kyrgyz economy,” she said.
Georgieva, a Bulgarian economist, added that the funding will help "catalyze donor support and free resources for essential COVID-19-related health expenditure."
In its statement, the IMF said the coronavirus pandemic has weakened Kyrgyzstan’s macroeconomic outlook and created a balance-of-payments gap estimated at $400 million.
Georgieva added that "to absorb the shock of the pandemic," the government of the nation of 6.2 million people "is appropriately implementing a temporary loosening of macroeconomic and financial policies."
On March 24, Kyrgyzstan declared a state of emergency in the capital, Bishkek, and several other regions and districts in response to the spread of the coronavirus.
It has reported 44 confirmed cases and no deaths, according to data compiled by Johns Hopkins University. However, experts warn that ascertaining the actual number of infections in any country is impossible due to the lack of testing.
The IMF indicated earlier this week that the Central Asian republic was likely to be the first country to receive funds from the Washington-based lender since the coronavirus outbreak began.
A dozen Central Asian and Middle East countries have approached the IMF for financial support, and work is ongoing to expedite approval of the requests, the IMF said. The lender's board is expected to consider some of the other requests in the coming days.
The IMF has several tools at its disposal to help member countries overcome the crisis and limit its human and economic cost, the IMF said. The financial institution is considered the world's lender of last resort.
The IMF has said it “stands ready” to loan up to $1 trillion to help countries that are struggling with the economic impact of the coronavirus.
“Nearly 80 countries are requesting our help,” Georgieva said in a statement on March 23.