BRUSSELS, April 3, 2014 - A successful multi-donor trust fund launched a new phase today with commitments from donors for close to US$20 million. The Debt Management Facility II (DMF II) program builds on previous success in debt-management advisory work and marks the beginning of a new partnership between the World Bank and the International Monetary Fund (IMF). The partnership will be dedicated to strengthening the capacity of developing countries to manage their debt in a manner that is sustainable and encourages economic development.
The facility expects to raise $40 million, and the new pot of money will extend the work of the first DMF, a US$22 million trust fund that the World Bank launched in November 2008.
The initiative was born out of a recognition that low-income countries graduating from debt-relief programs, such as the Heavily Indebted Poor Countries (HIPC), might continue to struggle. There was a worry that they might fall into a vicious cycle of debt and assistance.
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