Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva highlighted the need for lower-income nations for more fiscal help from rich countries as the global economy recovers from the Covid-19 crisis.
According to her, at an event organized by Chinese authorities, the flow of US$ 650 billion in Special Drawing Rights (SDRs) could be a way to meet this need.
“Many developing economies will need the support of the global community in their recovery as they face shrinking fiscal space and increasing debt burdens,” Georgieva said, before highlighting China’s President Xi Jinping’s announcement that the country intends to allocate $10 billion in SDRs in fiscal aid to the African continent.
The managing director of the Fund also stated that “actions” by the Communist Party to boost the Chinese economy amid the loss of strength of the recovery will also help the global economy.
On Monday, the People’s Bank of China (PBoC, its acronym in English) said it will cut the reserve requirement rate in the country, a measure that should free about US$1.2 trillion in liquidity.
Reference: CNN Brasil
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