Dr Akinwumi Adesina,the President of the African Development Bank (AfDB), has said that the Special Drawing Rights allocation of 650 billion dollars approved by the International Monetary Fund will help to boost the reserves of developing economies like Nigeria and others.
The AfDB president was quoted as making the remarks in a statement titled ‘International community must act to avert a two-speed global economic recovery post Covid-19’ presented to a closed-door session between German Chancellor Angela Merkel and heads of international development institutions last Thursday.
“The recent IMF release of $650bn in SDRs, with $27bn to Africa, will go a long way in helping to boost reserves for developing countries,” the AfDB boss was quoted as saying.
“If the developed countries reallocate $100bn of SDRs to Africa, as agreed at the Paris leaders meeting and by the G7, that will further support faster economic recovery in Africa.”
The statement said that heads of international development institutions present at the closed-door session included the heads of AfDB, IMF, the World Trade Organization, the World Bank, the International Labour Organization, among others.
German Chancellor, Angela Merkel, called on the IMF, G7 and World Bank to take measures in assisting lower and middle-income countries.
She also urged them to create strategies to drive economic recovery from the Covid-19 crisis.
“We have noted that the recovery after the pandemic is a two-speed recovery, which is cause for concern,” she said.
Low-income economies are expected to receive $21bn, about 6% of their Gross Domestic Products.
In her remarks, however, the IMF Managing Director, Kristalina Georgieva, said that the composition of the six per cent is changing, with advanced economies broadly accelerating growth, whereas most emerging markets and developing economies are falling further behind.
“This is a dangerous divergence,” she said.
“The consequences of the disparity include continuing supply chain disruptions and the risk of giving up hard-won gains in development, which would fuel unrest and instability.” ##
