A boost to the IMF is central to the new strategy to tackle the financial crisis, agreed by global leaders in London yesterday.
Wide-ranging reforms have been agreed at the G20 summit, which concluded in London yesterday.
Closing the conference, UK prime minister Gordon Brown announced that the International Monetary Fund (IMF), which provides emergency loans for countries suffering from financial crises, would be expanded to $750 billion, including a new $250 billion overdraft facility. Iceland and Ukraine are among the nations that have already called on the fund for support due to the credit crunch - and more are expected to apply if conditions worsen.
G20 member states also agreed to controls on bankers' salaries, a punitive crackdown on tax havens and a strengthening of the regulatory framework of the financial markets, as a preventative measure against such downturns occurring in the future. Hedge funds and ratings agencies, actions of which are thought by some economists to have helped caused the crisis, will also be more strictly regulated.
Around $250 billion has also been promised in the G20 agreement for measures aimed at boosting nations' economic output and promoting recovery. This brings the total package of reforms up past $1 trillion.
Mr Brown commented: "This is the day that the world came together to fight back against the global recession, not with words, but with a plan for global recovery and for reform and with a clear timetable for its delivery."
Markets responded positively to the G20 announcements, with London's FTSE 100 closing 4.28 percent up at 4,125 points. The Dow Jones in New York also gained by 2.79 percent yesterday.
