The IMF approves a significant increase in funding to mitigate the effects of the pandemic | WGN Radio 720
Washington (AP) – The governing body of the International Monetary Fund has approved an expansion of its $ 650 billion resources to help economically vulnerable countries cope with the coronavirus pandemic and the recession it has caused. I did.
Credit agencies in 190 countries said Monday that their board had approved an increase in reserves known as special drawing rights. This is the largest increase in the history of the institution.
“This was a historic decision that hit the world economy in times of unprecedented crisis,” said IMF Managing Director Kristalina Georgieva. “This is helping especially the most vulnerable countries, which are struggling to cope with the effects of the COVID-19 crisis.”
The total distribution of SDRs will take effect on August 23. The IMF said the new reserves would be credited in proportion to existing distributions by IMF member countries. About $ 275 billion from the new distribution will go to the poorer countries in the world.
The agency also said it was looking for ways in which richer countries could voluntarily target SDRs to poorer countries.
The significant increase in IMF resources has been rejected by the Trump administration. But after President Joe Biden took office in January, Treasury Secretary Janet Yellen backed her proposal.
Many Republicans opposed the increase in the SDR, saying expanded IMF resources would benefit US adversaries such as China, Russia and Iran. However, the increase in resources has been strongly supported by international support agencies.
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