Africa has only received $33b out of the $650b in IMF Special Drawing right

Africa has only received $33 billion out of the $650 billion in IMF Special Drawing Rights, according to the president of the African Development Bank.

Dr. Akinwumi Adesina, President of the African Development Bank (AfDB), has expressed concern over the inequitable distribution of the International Monetary Fund's (IMF) Special Drawing Rights (SDRs), revealing that Africa received a mere $33 billion, which accounts for only 4.5% of the global total of $650 billion.

In a statement issued on Sunday in Abuja, Dr. Adesina criticized the systemic disparities within international financial frameworks that continue to marginalize Africa, especially during crises like the COVID-19 pandemic, according to the News Agency of Nigeria (NAN). "Of the $650 billion allocated globally in SDRs, Africa received just $33 billion—merely 4.5%. This is particularly concerning given that Africa is the continent with the most pressing needs and the least resources to cope with the economic repercussions," Adesina remarked. Tony Elumelu's Companies Achieve N278.8 Billion in Capital Gains in Just Two Days: Dr. Adesina emphasized that the current SDR distribution model does not adequately address Africa's urgent financial requirements, which has suffered significant economic setbacks from the pandemic and possesses limited fiscal capabilities to implement effective recovery strategies.

To rectify this issue, he announced that the AfDB, in collaboration with the African Union, is working on initiatives to reallocate unused SDRs from wealthier nations to support African economies. Thanks to the AfDB's AAA credit rating, a new framework developed with the Inter-American Development Bank (IDB) has received approval from the IMF Board. "This is a transformative development; each dollar of SDRs redirected can be leveraged four to eight times. Therefore, a $50 billion reallocation could potentially unlock up to $200 billion in new development finance, all without costing taxpayers," Adesina noted. He characterized the approval of SDR reallocation through multilateral development banks as a pivotal advancement in addressing Africa's financing gap, particularly amidst a backdrop of declining aid budgets and escalating debt challenges. Increasing Concessional Financing: In efforts to bolster the continent's financial resilience further, Adesina announced that the African Development Fund (ADF), the AfDB's concessional lending arm, is currently seeking an additional $27 billion from global capital markets. This funding is projected to benefit 37 low-income countries throughout Africa. This announcement comes as the ADF prepares for its 17th replenishment cycle.

Adesina called upon international donors for stronger support, stressing that enhanced concessional resources are vital for alleviating poverty and fostering inclusive growth across the continent. "With increased investment in health, innovation, and financing, Africa can safeguard its population, realize its potential, and carve its own path toward prosperity," he concluded. The SDR is an international reserve asset devised by the IMF to augment the official reserves of its member nations.
Edited by BBN