The International Monetary Fund (IMF) has approved the largest-ever distribution of monetary reserves of $650 billion to boost the global economy and help emerging and low-income nations deal with the mounting debt and Covid-19 crises.
The IMF board of governors met in Washington on Monday and approved this historic allocation, known as Special Drawing Rights (SDR). Pakistan, which has so far had 23 financial arrangements with the IMF, will also benefit from the boost.
The general allocation of SDRs will become effective from Aug 23 this year.
In December 2019, the IMF approved a 39-month Extended Arrangement under the Extended Fund Facility (EFF) for Pakistan in the amount of SDR 4,268 billion, which is about $6bn. This is equivalent to 210 per cent of Pakistan’s quota of SDR 2031 million. The SDR is a basket of mixed currencies made available to member countries.
“This is a historic decision — the largest SDR allocation in the history of the IMF and a shot in the arm for the global economy at a time of unprecedented crisis,” IMF Managing Director Kristalina Georgieva said in a statement announcing the decision.
