Economic adjustment and reform in low-income countries

In the aftermath of the debt crisis of the early 1980s, many of the IMF's poorest member countries embarked on far-reaching programs of adjustment and economic reform. The severity and structural nature of the economic problems to be addressed suggested a need for longeer-term financial support than that available under the IMF's conventional instrument for members' use of its resources, the Stand-by Arrangement. At the same time, fiven the low per capita incomes and typically large external debts of the countries concerned, there was a desire in the international community to ease the burden of new IMF loans by offering them to eligible borrowers on highly concessional terms.