Bloomberg News

Estonia Won’t Contribute to 200 Billion-Euro IMF Capital Boost

December 12, 2011

Dec. 12 (Bloomberg) -- Estonia won’t join other European Union nations in helping channel 200 billion euros ($265 billion) to the International Monetary Fund, the Finance Ministry said.

“Estonia didn’t participate in the IMF capital boost in 2009 following the financial crisis and Europe is currently not counting on Estonia’s contribution,” the ministry said today in a written response to e-mailed questions from Bloomberg.

EU member states last week agreed to consider and confirm within 10 days contributing funds to the IMF in the form of bilateral loans to ensure the Washington-based fund has adequate resources to deal with the sovereign debt crisis.

“Estonia first needs to resolve matters pertaining to IMF quota reforms of 2008 and 2010, including increased downpayments, which in themselves will significantly increase Estonia’s contribution to the IMF,” the Finance Ministry said. “The contribution total cited in the conclusions of the summit was reached by doubling the bilateral loans extended by Europe to the IMF in 2009.”

Estonia’s central bank plans to comment on the issue tomorrow, spokesman Viljar Raask said in a phone interview.

The Baltic nation plans to boost its contribution to the IMF to 243.6 million SDRs, or 277 million euros, from 65.2 million SDRs, or 74.1 million euros, under quota reforms of 2008 and 2010, the Finance Ministry said, adding that Parliament is due to approve the first part of the two-phase increase on Dec. 15, with the second phase due by next summer.

SDRs are currency units developed by the IMF based on a basket of major currencies.

--Editors: Paul Abelsky, Andrew Langley

To contact the reporter on this story: Ott Ummelas in Tallinn at oummelas@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net


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