ECA head commends G7 Finance Ministers decision to back SDRs for developing and COVID vulnerable countries

The meeting of the committee of experts of the Conference of African Ministers ended Friday ahead of the African Finance Ministers Meeting next week and saw experts pledge to do more to accelerate the implementation of the AfCFTA, improve domestic resource mobilization, deepen digitalization and accelerate the implementation of the global Agenda 2030 and Africa’s Agenda 2063.
The Executive Secretary of the Economic Commission for Africa (ECA), Vera Songwe, welcomed the move by the G7 Finance Ministers to support issuance of new Special Drawing Rights which will help developing countries better respond to the COVID 19 crisis.
The Ministers agreed to support a new Special Drawing Rights (SDR) allocation to assist vulnerable countries respond adequately to the health and economic crisis triggered by the pandemic.
Speaking following the G7 Finance Ministers meeting, the United Kingdom’s Chancellor of the Exchequer, Rishi Sunak, said: “Today’s milestone agreement among the G7 paves the way for crucial and concerted action to support the world’s low-income countries, ensuring that no country is left behind in the global economic recovery from coronavirus.
The UK currently holds the Presidency of the G7.
“This is a very important and strategic step on the road to a new issuance of Special Drawing Rights by the G7 Finance Ministers today. The SDRs are our chance to do something transformational for a large number of frontier economies. We are grateful for the leadership shown by the G7 Ministers,” said Songwe, who has been at the forefront advocating for international financial institutions and others to provide more liquidity to allow African countries to build forward better post-COVID-19.
“Now we need to work on mechanisms for on-lending so we can stretch the SDRs for countries that need them most. Additional funding for the IMF PRGT from the SDRs of course is critical for low-income countries. We need to get vaccines to countries and also support the recovery with market access instruments that crowd in the private sector such as the Liquidity and Sustainability Facility.”
She added: “SDRs allow us to think out of the box and bigger. There is now real momentum for collective action at the IMF and World Bank spring meetings and also for the African Finance Ministers meeting next week organized by ECA.”