CPLP member countries, Mozambique included, to receive total €16.5B in IMF allocation of SDRs

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CPLP member countries, Mozambique included, to receive total €16.5B in IMF allocation of SDRs

9:03 CAT | 25 Aug 2021

in file CoM

Members of the Community of Portuguese-Language Countries (CPLP) are altogether to receive almost €16.5 billion as part of the new allocation of Special Drawing Rights (SDR) of the International Monetary Fund (IMF), which was implemented from Monday.

According to a document approved by the board of the IMF earlier this month aimed at strengthening the foreign exchange reserves of all members, and which is being implemented from Monday, the sum of the amounts attributable to the nine CPLP member countries, including Portugal, is €16,492.5 million, representing 13,623 million units of SDR on current exchange rates.

Brazil, the largest CPLP economy, is to receive the equivalent of €12.7 billion, followed by Portugal, which will see its foreign reserves increase by €2.373 billion.

Of CPLP members in Africa, Angola is to receive the largest allocation, the equivalent of €852 million, followed by Mozambique with €261 million, Equatorial Guinea with €181.6 million, Guinea-Bissau with €32.6 million, Cabo Verde with €27.8 million, and Sao Tome and Principe, which is to receive almost €17 million in foreign exchange reserves.

In all, Portuguese-language Countries in Africa (PALOPs) are to receive a reinforcement of €1,372.2 million euros, or 1,134 million units of SDRs.

The SDR allocation will help countries in greater difficulty in balancing their accounts and strengthen the commitment to combat the spread of the pandemic, and African countries hvae said is essential to revive economic growth in the region.

African countries, particularly those in sub-Saharan Africa, have argued that their share of SDRs is disproportionately lower than their needs due to their small quota in the IMF, given low rates of vaccination against Covid-19 and the need to maintain financing for projects with the capacity to strengthen infrastructure and so ensure the attractiveness of new investments to promote growth.

The IMF has argued that more advanced economies in less need of the funds should transfer part of their SDRs to developing countries. Major powers have already agreed to channel at least $100 billion to the countries with the most difficulties.

Source: Lusa