G8 pledges $38bn to Arab states as IMF recognises Libya

G8 finance ministers with IMF head Christine Lagarde, Marseille (9 September 2011)
Image caption The money agreed is far higher than the original amount pledged in May

Finance ministers from the G8 group of industrialised countries have pledged nearly $40bn (£25bn) to several Arab countries to help with reconstruction and moves towards democracy.

The money will go to Egypt and Tunisia, which overthrew their autocratic leaders, as well as Morocco and Jordan.

In addition, the International Monetary Fund (IMF) has recognised Libya's post-Gaddafi leadership.

The G8 - the world's richest countries plus Russia - is meeting in Marseille.

In addition to the pledge of $38bn from G8 countries, the IMF is extending further funds.

"The IMF can actually extend an approximate total of $35bn for the region and particularly with the focus on those that are oil-importing countries because, as we know, they are the ones that are suffering the most from the high commodity prices, whether it's fuel or prices of food," said IMF head Christine Lagarde.

Morocco and Jordan, both monarchies, have seen some protests but have weathered the upheavals in the Arab world by offering constitutional reforms.

The total of $73bn in pledges nearly doubles the amount originally pledged by the G8 and lenders including the World Bank at an earlier summit in May.

The IMF decided to recognise Libya's National Transitional Council (NTC) as the legitimate representatives of the Libyan people, replacing fugitive leader Col Muammar Gaddafi. The move paves the way for the IMF to offer aid to the new authorities.

The IMF will send a team to Libya as soon as security permits.