Serving God's People in Africa since 1868

Another Tool to save lives and Reduce Economic Hardship Caused by Covid-19

The threat of Coronavirus continues to be underestimated by many Africans in part because the loss of lives initially predicted since March 2020 did not happen. The truth is that questioning the existence of the virus does not make it go away. A global challenge like Coronavirus requires a global response for the safety of the whole world. The world must join hands to fight COVID-19 the same way it did to stop the 2014-2016 Ebola outbreak in West Africa.

Already, COVID-19 economic impact continues to deepen and the predicted 2020 economic growth in some countries was certainly not achieved. In 2009, in response to the global financial crisis, the International Monetary Fund (IMF) issues Special Drawing Rights (SDRs) to help ease the impact of the crisis especially on developing economies. SDRs are special international reserve assets created by the IMF distributed to central banks of countries in proportion to their IMF quotas. Countries can exchange SDRs for currencies when they are in weak financial positions.

As of the end of this year 2020, the UNited States has opposed the issuance of SDRs despite the fact that it does not cost US taxpayers anything. Like any IMF member country, the US is entittled to SDRs as well. This measure by the IMF could certainly give access to its member countries much-needed funds to overcome COVID-19 related challenges.

On Two trillion dollars in SDRs a country like Togo could receive 837 million, South Africa 17.8 billion, Somalia 279 million, Sierra Leone 1.1 billion and the list goes on.  These countries can use this money to order vaccines which only wealthy countries are able to afford at this moment.

The issuance of SDRs must, however, be combined with robust transparency measures in order to really save lives and prevent the collapse of struggling economies of IMF member countries.