Why the IMF is not doing enough to support Africa

President William Ruto and IMF Managing Director Kristalina Georgieva during a past meeting. [File, Standard]

At the 2021 UN Climate Summit, Barbados prime minister Mia Mottley called for more and better use of special drawing rights (SDRs), the International Monetary Fund’s reserve asset.

The special drawing right is an international reserve asset created by the IMF. It is not a currency – its value is based on a basket of five currencies, the biggest chunk of which is the US dollar, followed by the euro. It is a potential claim on the freely usable currencies of IMF members. Special drawing rights can provide a country with liquidity.

Countries can use their special drawing rights to pay back IMF loans, or they can exchange them for foreign currencies.