The Board of Governors of the International Monetary Fund (IMF) on August 2, 2021 approved a general allocation of special drawing rights (SDRs) of $ 650 billion to increase liquidity around the world.
“This is a historic decision: the largest allocation of SDRs in IMF history and a breath of fresh air for the world economy in this time of unprecedented crisis. This SDR allocation will benefit all member countries, meet the global need for long-term reserves, boost confidence and strengthen the resilience and stability of the global economy. It will especially help our most vulnerable member countries as they work to overcome the effects of the Covid-19 crisis, “said IMF Director Kristalina Georgieva.
The provision of these funds will come into effect on August 23, 2021. These newly issued SDRs will be allocated to member countries in proportion to their quota in the IMF. Emerging and developing countries, including low-income ones, will receive around $ 275 billion from the new allocation, according to the Washington-based Fund.
On the table for several months, this option approved by the IMF was confirmed last May at the Paris summit on the financing of African economies. And unless changed, the share intended for the countries of the continent would be 33 billion dollars if we refer to the pro rata in force which correspond to the respective quotas of the IMF shareholders. “It is too little and still insufficient”, declared Emmanuel Macron at the end of the summit.
Hence a stated goal of reaching a target of USD 100 billion in SDRs for Africa, through the reallocations of SDRs by the richest countries to the countries of the continent. “We will also continue active discussions with our member countries to determine viable options for a voluntary transfer of SDRs from richer countries to poorer and more vulnerable countries to help them recover from the pandemic and achieve resilient growth. and sustainable ”, emphasizes Kristalina Georgieva.