The International Monetary Fund has approved a short-term lending programme aimed at stemming the world's liquidity problems by offering short term loans to emerging market economies.

The programme will provide countries with quick access to minimum-strings-attached loans from a designated fund. The IMF didn't name which countries would be eligible for the programme, but said countries with well run economies would be considered.

Dominique Strauss Kahn, the IMF’s managing director, said: "We are prepared to use our own resources and to work with others to generate additional resources to make sure that countries have the money they need to restore confidence and maintain stability.”

In recent weeks the IMF has been subjected to increasing requests for its assistance. It has already agreed to provide a $2.1 billion loan to Iceland, a $15.7 billion loan to Hungary and a $16.5 loan to Ukraine. The loan to Hungary is part of a larger $25.1 billion aid package being offered in conjunction with the European Union and World Bank.

The IMF, which estimates it has more than $200 billion in loanable funds at its disposal, is also discussing loan options with Serbia, Belarus and Pakistan.

The Fund's liquidity facility is one of many moves entities around the world have taken to address strains in short-term credit markets.

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