UN calls on rich countries to give up their special drawing rights

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UN calls on rich countries to give up their special drawing rights

United Nations, Jun 24 (EFE) .- The UN asked rich countries on Thursday to redirect part of the next issuance of special drawing rights that the International Monetary Fund (IMF) will make to developing nations in order to achieve a truly global response to the pandemic and an inclusive and green recovery.

In a new report, the United Nations Development Program (UNDP) argues that this issuance offers a unique opportunity to help the most vulnerable countries cope with the Covid-19 crisis and its major public debt problems.

The IMF plans to allocate special drawing rights, its nominal currency, worth $ 650 billion, the largest injection of liquidity since 1945, in an attempt to support the response to the current crisis.

“This is almost a unique gift for the world right now if used wisely,” UNDP administrator Achim Steiner defended at a press conference, stressing that the result is in the hands of rich countries.

The UNDP proposes that nations with solid economic foundations and surplus reserves voluntarily redirect special drawing rights that correspond to them in order to ensure a “green and inclusive recovery at the global level”.

If this does not happen, he argues in his report, the issuance will offer some relief to the countries with more difficulties, but it will be insufficient.

The UNDP highlights that of those 650,000 million only 55,000 million would correspond to the 82 developing countries with problematic debt levels, which is equivalent to only around 1.8% of their total debt.

In other words, it would not cover even one year of interest payments for most of those countries.

Meanwhile, some $ 283 billion would correspond to the G7 powers and $ 438 billion for the high-income countries as a whole.

Article source: https://es-us.finanzas.yahoo.com/

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