After repeated calls from Heads of State and senior leaders on the need to facilitate global economic recovery through new liquidity made available to countries, the International Monetary Fund (IMF) has given its agreement for the disbursement of 650 billion dollars corresponding to Special Drawing Rights (SDR).

Awaited by the countries of the world, in particular those in the developing world, to better finance their economy and strengthen their commitment to the fight against Covid-19, the allocations of Special Drawing Rights (SDRs) have just been authorized by the Board of Governors of the International Monetary Fund (IMF). This, a few days after the authorization of the Board of Directors on July 09, 2021. According to the IMF, this allocation which has been requested by world leaders on several occasions will "increase liquidity in the world". First Largest SDR Allocation in IMF History, “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 particularly help our most vulnerable member countries struggling to overcome the effects of the COVID-19 crisis,” said Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF).

Scheduled to enter into force on August 23, 2021, these newly issued SDRs will be allocated to member countries in proportion to their IMF quota. Emerging and developing countries, including low-income ones, will receive about $275 billion (or about SDR 193 billion) from the new allocation. However, the institution, as recommended by the G7, has entered into talks with the rich countries so that part or all of their quota is reallocated to developing countries. For the IMF, one of the main options would be for member countries with a strong external position to voluntarily use a portion of their SDRs to increase the resources of the Poverty Reduction and Growth Trust Fund (PRG Trust Fund), which would increase the supply of loans to low-income countries. Concessional assistance under the PRC Trust Fund currently bears a zero interest rate.