Recipient countries would pay the IMF interest at a very low rate, equivalent to the composite average treasury bill rate of all convertible currencies. They would have free use of their own allocations but would be supervised in how the borrowed allocations were used to ensure they were well spent.
I am not sure that the IMF has such a good record on identifying to proper allocation of funds that they are the best judges of such a task. I would rather depend upon the country's leadership, who might or might not know what they are doing, but have a better record than the IMF.
In his article in the Wall Street Journal Soros suggests that credit default swaps are "toxic instruments whose use ought to be strictly regulated." Surely if credit default swaps are actually toxic they should be abolished, rather than merely regulated.
Soros will be speaking at tomorrow's Looking Towards the London G-20 Global Growth Summit event, so I will be interested to hear what he has to say.
Soros' book, The Age of Fallibility: The Consequences of the War on Terror, is filled with insight and highly recommended.