KARACHI: Pakistan may receive an amount of $2.5 to $3 billion from the International Monetary Fund (IMF) under the Special Drawing Rights (SDRs) in the first quarter of 2021-22.
The increase in the SDRs — reserves of the IMF that are exchangeable with US dollar, yuan, sterling, euros, and yen, will be good for growing economies, such as Pakistan, Turkey, Sri Lanka, South Africa, and Nigeria.
“These countries will see 10 to 20 percent boost in their forex reserves at IMF,” Reuters quoted analysts as saying.
This could be the highest SDR issuance by IMF since its inception. During the global financial crisis of 2009, the SDR of 182.6 billion was allocated to the member countries to provide liquidity to the global economic system and to supplement the official reserves of member states.
Recently, IMF’s Managing Director Kristalina Georgieva announced that the global fund was going to discuss the issuance of additional SDRs to the extent of 460 billion SDR, equivalent to $650 billion.
According to Georgieva, the proposal is to be presented at the executive board meeting in June 2021 for formal approval. The allocation of new SDRs would benefit all member countries, including Pakistan, for the support of global economic recovery from the COVID-19 crisis and vaccination programs.
Earlier, amid the pandemic, the IMF had disbursed $107 billion to support poor and middle-income countries including Pakistan which face twin deficit. Pakistan received $1.4 billion under this relief.
As per the quota under IMF, Pakistan holds 0.426 per cent share in the total SDR. The above development can culminate benefits of up to $2.5-3bn, which could provide relief for the efficient management of external payments (imports and debt repayments).