By: Kebba AF Touray
The Ministry of Finance and Economic Affairs has Tuesday 24th August 2021, issued a press release stating that the country will receive US$85 million from the International Monetary Fund (IMF).
The release came in the wake of an announcement by the Managing Director of the International Monetary Fund (IMF), Ms.Kristalina Georgieva, on August 23rd, 2021.
The announcement by the IMF MD indicated that a total of US$650 billion SDRs Allocation to IMF member countries- is the largest allocation of Special Drawing Rights (SDRs) in history.
Of the US$650 billion allocation, The Gambia will receive US$85 million which is equivalent to 4.5 percent of the Gambia’s Gross Domestic Growth.
“The allocation is a significant booster for the world and if effectively used, would offer a unique opportunity to fight this unprecedented Covid-19 pandemic,” the ministry said.
As indicated in the release, the SDRs Allocation will provide additional liquidity to the economy, including enhancing The Gambia’s foreign exchange reserves, reducing the economy heavy dependence on expensive domestic and external debts.
“Furthermore, The Gambia can use the fiscal space provided by SDRs Allocation to support the economy, respond to the pandemic and minimize the impact of the crisis. Considering the allocation of SDRs in quota share in the IMF, it implies that The Gambia will receive an allocation amounting to US$85million, which is equivalent to 4.5 percent of The Gambia’s GDP,” the ministry said.
The ministry further stated that the SDRs are valuable resources, and its usage depends exclusively on the decision of the country. It added that in adherence to fund transparency and accountability, the IMF is providing a framework for assessing the macroeconomic implications of the new allocation, its statistical treatment and governance, and how it might affect debt sustainability.