International Monetary Fund (IMF) has commenced the allocation of Special Drawing Rights to boost the economies of participating countries.
In a statement available on the website of IMF, the Managing Director of the International Monetary Fund, Ms Kristalina Georgieva, said that the organisation has commenced allocating Special Drawing Rights of about $650bn.
According to Georgieva, “The allocation is a significant shot in the arm for the world and, if used wisely, a unique opportunity to combat this unprecedented crisis.”
“The SDR allocation will provide additional liquidity to the global economic system – supplementing countries’ foreign exchange reserves and reducing their reliance on more expensive domestic or external debt.
“Countries can use the space provided by the SDR allocation to support their economies and step up their fight against the crisis.”
She further said that the allocation would be made to countries based on their quota shares in the IMF.
“SDRs are being distributed to countries in proportion to their quota shares in the IMF. This means about $275bn is going to emerging and developing countries, of which low-income countries will receive about $21bn – equivalent to as much as six per cent of GDP in some cases