These are busy days for the International Monetary Fund. Preoccupied with the coronavirus fallout, it is also being asked to resolve the mess in several emerging markets where things have gone sour.
An IMF team will wrap up a three-day visit to Lebanon on Sunday. While the aim is ostensibly to dispense “technical advice” on a crippling financial crisis, it may not be long before the fund is asked by Beirut for a formal bailout
The lender is also fighting fires in Argentina. It ended a week-long visit with a verdict that the country needed a plan to restructure debt. Of course, there are those who say the fund is only sorting out a mess it helped create; Argentine economy minister Martin Guzman claims austerity policies prescribed under the fund’s 2018 bailout contributed to the crisis.
Jordan, Egypt, Papua New Guinea and Ukraine are some of the other countries grabbing the fund’s attention. As demand for IMF guidance rises, the institution might be reviewing its approach. Fund chief Georgieva has suggested flexible exchange rates — often the centrepiece of IMF advice to struggling countries — may not always be the most suitable shock absorber.
Lebanese authorities might be wondering if their country will be the guinea pig for any IMF policy rethink.