Switzerland to help Yugoslavia join IMF

Switzerland has agreed to lend Yugoslavia SFr243 million ($145 million) to allow it to rejoin the International Monetary Fund (IMF). The government said the money would be paid back within days.

The cabinet approved the loan at its weekly meeting on Wednesday to help Yugoslavia cover its debts to the IMF. Belgrade will not be allowed to rejoin the organisation until it has paid its debt of SFr220 million.

Yugoslavia is also required to pay its share of the increase in the IMF’s capital that occurred in its absence. This has been valued at SFr133 million.

Switzerland’s interest-free loan will cover the lion’s share of Yugoslavia’s debts, with Norway offering the rest. The Swiss government said the gesture was in response to Yugoslavia’s decision to join the Swiss voting group at the IMF and World Bank.

The addition of Yugoslavia to the group – which already includes Azerbaijan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan – gives Switzerland more weight in the Bretton Woods organisations.

The government said it expected the money to flow back to the National Bank very soon. Once allowed back into the IMF, Yugoslavia will be eligible for an emergency credit with which it can repay the loan.

swissinfo with agencies