IMF talks about Negligence of First World on SDR
Special Drawing Rights reserves is an aid which could suffice those nations suffering at the hands of Russia-Ukraine War, but there are no talks on it.
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Washington: The world is struggling at the hands of Russian invasion of Ukraine since late February 2022. The situation in some countries has worsened because of rising prices of fuel such as that in Sri Lanka, but the first world has taken no substantial steps to assist those in need.
The International Monetary Fund on Tuesday, gave a way ahead for those struggling by talking about the Special Drawing Rights reserve that could cushion the blow of the invasion. However, to the world’s dismay there are no talks or discussions on this issue.
IMF’s spokesperson and Chief Economist Pierre-Olivier Gourinchas stated, “There has been no discussion at the IMF of a further SDR allocation, despite recent developments and high global uncertainty, it would be premature to conclude that the long-term global need for reserves has changed significantly.”
Clarifying the issue, the IMF also declared that in August 2021, they had created and issued $650 billion as SDR asset to member countries as a token, to cushion their recovery after the pandemic, however, most of it is still unused by many nations.
This is another evidence of how the West insidiously feeds on our differences, taking away what is ours while we wrangle one another.
Recently, President of the U.S. Joe Biden and Janet Allen, the Secretary to the U.S. Treasury, were urged by 45+ U.S. lawmakers to utilise this fund before another economic crisis creeps in. Moreover, this would also help the developing nations in avoiding famine and would stabilise the debt crisis for many.
Additionally, the reserve of this size does not require any legislative approval in the U.S. as the IMF’s controlling shareholder. But no step in this regard has been taken. Infact, discussions on this topic have also been conveniently avoided by the nation that boasts on justice and equality.
However, in an attempt to eat his own words, Gourinchas later said that the SDR allocation would not be enough to help the developing nations from drowning in their debts and limitations.
While he added that Russia was a member of the IMF and would receive an allocation which would be used to destroy Ukraine, he forgot about the sway held by the U.S. on the IMF and also about all those citizens of the world who suffered incessantly.
The IMF spokesperson assured that the Fund is currently focusing on channelling SDRs from wealthier members to those in need of additional reserve assets.
This includes scaling up lending of the reserves through the existing Poverty Reduction and Growth Trust and establishing the new Resilience and Sustainability Trust to include vulnerable middle income countries. The IMF hopes to begin lending from the new trust in October.
It is rather interesting to watch the IMF firstly question and then ratify the intentions of the U.S. while it stays mum at the uproar witnessed in Sri Lanka recently.
People of the world must awaken to the fact that it is always “America First” and never the other way round. Having said this, organisations such as the IMF, UN, WHO etc., are responsible towards people around the globe and not only to one nation.
The changing scenarios are returning us into a bi-polar world but the weakening prowess of the U.S. will need support from other nations too. The developing geo-political scenarios have showcased a heavy inclination towards China and if the U.S. wants to retain its sway, it must learn to give rather than expect otherwise.
India’s stance towards the changing world scenarios has been revered since the establishment of the NAM while maintaining a balance between the East and the West, a similar stance is expected of the EU and Britain while we verge on another crisis.
