Several countries, including France, have promised to redirect part of their Special Drawing Rights to African economies. But the continent, which sees nothing coming, is beginning to get impatient.
They were to be effective aid for low-income countries, especially at the time of the Covid-19 pandemic. But have the Special Drawing Rights (SDRs) really achieved their objectives? Nothing is less sure. Created in 1969, the SDRs, from the International Monetary Fund (IMF), are, according to the NGO ONE, “international reserve assets which supplement the foreign exchange reserves of IMF member countries”. The movement specifies that these SDRs can be exchanged for currencies, in particular in the event of a monetary crisis.
On the side of the IMF, it is insisted on the fact that “the SDR is not a currency, nor does it constitute a claim on the IMF. On the other hand, it represents a virtual claim on the freely usable currencies of IMF member countries”.
Aid for… rich countries
In May 2021, in the midst of a global pandemic, French President Emmanuel Macron had, at the height of the summit on the financing of African economies, promised to review the SDR mechanism. A few months later, the IMF Board of Governors approved a new SDR allocation of $650 billion.
But despite the encouragement of the French Head of State, African countries have actually benefited little from the revision of this mechanism. As the IMF points out, “it is proportionally, according to their IMF quota, that the countries receive the allocation”. In other words, if African countries are the ones that need SDRs the most, it is the richest countries that benefit from them. Africa must share 33 billion dollars. The CEMAC (Economic and Monetary Community of Central Africa) zone, for example, received only $1,5 billion.
Africa hopes for 100 billion dollars
We are far from the 100 billion hoped for today by the continent, which would come from France, which had made a commitment to reallocate 20% of its SDRs for the benefit of African economies. Problem: not easy to find how to get out these sums without the financial balance sheet of the Banque de France suffering.
This April 25, the French president will have to provide an answer. A ministerial meeting of CEMAC and France is indeed being held in Paris. And the SDRs will be at the heart of the debates. Paris must now find the solution: how to return its share of SDRs to Africa? If loans seem to be an interesting option for France, for Africa, on the other hand, the pill will be difficult to pass.
Last year, the IMF announced the creation of the Resilience and Sustainability Trust Fund (RST), whose objective will be to collect the SDRs that the rich countries want to redirect to the poorest countries, then redistribute them. .
While waiting for the legal issues to finally be settled, Africa is patiently waiting for France and the rich countries to keep their commitments. But after the health crisis and while the war in Ukraine does not stop, patience is starting to wear thin.