This report is a part of research by the ABC Geopolitical Research Team working on to find out reasons responsible for Myanmar Coup and published in the interest of fair geopolitics in our globe.
Explained: A Link Between Myanmar Coup And IMF $ 700 Million for COVID-19
New Delhi (ABC Live
India); The military has taken over governance authority of Myanmar by arresting
the country’s elected leader, Aung San Suu Kyi, and President Win Myint.
The ABC Geopolitical Research Team keeping
close watch over the recent developments concerning Myanmar reports that on January
13, 2021 the Executive Board of the
International Monetary Fund (IMF) approved a disbursement of SDR 86.1 million
(16.67 percent of quota) under the Rapid Credit Facility (RCF), and a purchase
of SDR 172.3 million (33.33 percent of quota) under the Rapid Financing
Instrument (RFI) to Myanmar.
This was the second IMF emergency financial assistance under the
RFI/RCF for Myanmar since the outbreak of the pandemic: on June 26, 2020, the
IMF Executive Board approved a disbursement of US$ 356.5 million (see IMF Press Release No. 20/247 ).
According to IMF
statement this additional financing brings the total IMF financial
assistance provided to Myanmar to address COVID-19 pandemic to about US$ 700
The Inside sources in Myanmar has confirmed the ABC Report that the control over IMF
sanctioned US$ 700 million was one of the major contentious reasons between democratic
leaders and the Myanmar military regime resulted
into present coup.
The following are the questions of Journalists
and answers on behalf of IMF on Myanmar by IMF official spokesperson Gerry Rice
in a press
“QUESTIONER: In terms of
Myanmar, recent developments in Myanmar. It seems that quite recently, just
before the coup, that the IMF had given some $350 million and dedicated it
toward it. I'm wondering what are your thoughts? First of all, what are the
IMF's thoughts, obviously, on the coup? But also generally, how did the IMF
react when there's a change of government in this way right after they've given
money? Is there any -- how can you assure that the money goes, you know, for
the intended purposes? That it doesn't actually support a now more military
government? That's my question for today.
MR. RICE: Thank you very much for that. We are, of course, very
concerned about the impact of recent events and what they could have on the
people of Myanmar, and we're watching it very closely, of course, like the rest
of the world. Just to remind that, of course, Myanmar faced large economic and
social costs as a result of the pandemic, and the IMF resources, our support
was to help the people of Myanmar to meet these urgent humanitarian needs. That
was the whole purpose.
Again, just to set in context, the approval
of this supports was back in January by our board and followed all standard
procures for this kind of emergency financing. The same as we have done for
another 84 countries in this crisis, and standard safeguards in place regarding
the resources, including the repayment schedule. And as I think you know, the
IMF's record over 75 years on repayment and safeguarding of IMF resources is
very clear. In terms of the status of our engagement, we have had no
communication at this point with the new regime, and that's about as much as I
have at the moment on Myanmar.
QUESTIONER: So I had a
question to follow up on Myanmar. I'm just wondering, on what happens [next]?
Do you have to wait until whatever government emerges to reach out to the IMF
to see if there's going to be even a relationship with the IMF going forward?
And, you know, some people that I've spoken with are suggesting that well, this
is kind of a pitfall of these rapid disbursing instruments that have been used.
The money goes out very quickly all at once with no or very few conditions
attached to it. Is there any thought to changing that at this stage and, you
know, just wondering what next steps are on this? Is it just waiting till the
smoke clears to decide how we engage? Also, the military generals that were
appointed, a new central bank chief who was the same guy that ran the central
bank when they were in power. Is there some concern that the central bank will
lose its independence?
MR. RICE: Just on your last point, of course, the independence of
central banks is one of the fundamental principles that the IMF believes in and
supports so, you know, just to make that very clear. On your other points,
clearly the situation is unfolding. In terms of recognition of the government
as in other cases, we are guided by the international community, guided by the
membership in terms of recognition of the government. So again, the situation
is unfolding there but that's what guides us in terms of our relationship with
You know, what I'd say on how the resources
that we approved back in January how they are used, clearly again, as I said,
these resources were for a clear purpose, the crisis, the pandemic, the helping
with the humanitarian needs there. And, of course, it would be in the interest
of the government and certainly the people of Myanmar that those funds are
indeed used accordingly. Under the arrangement that was agreed with the
previous former government, there was indeed safeguards regarding how the funds
would be used as is the case with all of our emergency financing. I've talked
about it here before. That included audit and, you know, transparency of how
the resources are used. And again, this is true for all of the emergency
financing. So while there are few conditions, as you rightly say, there are
safeguard provisions and it would be our expectation that, you know, regardless
of the future that these commitments would be maintained. Because those resources
need to go to support the people and especially vulnerable groups.
So you asked finally where we’re thinking
of changing. You know, again, we've been using these emergency financing
instruments in 85 countries so far. I think they have been a huge help and
assistance in the crisis especially to the poorest countries, to low income
countries. And I think one of the reasons that they've been so effective and
we've been able to get the support so quickly is the, you know, the conditions
are relatively few. However, and again I stress, the safeguards and the
governance of those resources is something that we give high priority to and
each one of those has a set of safeguards. Whether it's audit or publishing of
procurement contracts, you know, there's a whole series of governance related
provisions that we have attached to these loans. These are very important and
we're confident that the resources will be well used and for the purpose that
they were intended in these emergency financing loans.”
This report is a part of research by the ABC Geopolitical Research
Team working on to find out reasons responsible for Myanmar Coup and published
in the interest of fair geopolitics in our globe.