Early on in the COVID-19-induced financial crisis in Africa, finance ministers and other senior-level stakeholders across the continent called on the IMF to issue new so-called Special Drawing Rights (SDRs) that would provide desperately-needed liquidity into their economies.
When the IMF issues SDRs it’s almost like a bank printing money. But the catch is that the IMF must distribute those funds equally to all 190 members according to a country’s share of the fund. That means every country, regardless of its financial condition, will receive proceeds from the new SDRs. And that’s what a lot of people in Washington want to prevent — specifically allowing unrestricted money to flow to U.S. rivals including China, Iran, and Venezuela.
