“Staff-Level Agreement” and “Extended Fund Facility” are the instruments of which of the following?
(a) World Economic Forum
(b) Asian Development Bank
(c) World Bank
(d) International Monetary Fund
Explanation
The International Monetary Fund provides a bailout option in a balance of payments crisis where a nation is unable to pay for essential imports or service its external debt. The government of the nation has to commit to the economic policy conditionalities of the IMF before the bailout.
A "Staff-Level Agreement" with the International Monetary Fund (IMF) is a preliminary agreement reached between IMF staff and a member country's government. It outlines the economic policies and reforms the country must implement to receive financial assistance from the IMF.
The Extended Fund Facility (EFF) arm of the IMF provides financial assistance to countries facing serious medium-term balance of payments problems because of structural weaknesses that require time to address.
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