A Shift Toward Net Repayment? Low-Income Countries’ Changing Net Financial Relationship with the IMF

Low-income countries (LICs) are moving toward repaying more to the International Monetary Fund (IMF) than they receive in new disbursements. Aggregate net flows from the Poverty Reduction and Growth Trust (PRGT) to LICs are projected to turn negative around the end of the decade, as the exceptional lending of recent years comes due for repayment, while the share of borrowing countries already making net repayments on their PRGT loans looks set to reach a historic high in 2026. An obvious reaction is that this may simply reflect the normal working of a revolving lending cycle. But that interpretation sits uneasily with the historical record. Aggregate net-negative flows have been genuinely rare over the past 25 years, and many LICs have engaged with the IMF for long, repeated stretches rather than through discrete borrow-and-repay cycles.

But the projected shift is not predetermined. Sustainable PRGT lending capacity is a long-term envelope rather than a hard annual ceiling, and access policies, safeguards, and the IMF’s tolerance for risk also shape the scale and pattern of future financing. With LICs facing constrained external financing, limited buffers, and renewed global pressures, the direction of this financial relationship warrants conscious consideration by the IMF’s membership rather than emerging from existing framework settings by default.