The International Monetary Fund (IMF) and the world Bank (BM) sent this Thursday signs of some reforms in which they are involved in order to mobilize many more funds, public, but also private, to finance the fight against poverty and against the consequences of climate change.
The general director of the IMFKristalina Georgieva, announced in the first of the two days of the summit of the new global financial pact that is being held in Paris that an agreement has been reached to redirect US$ 100,000 million of the so-called special drawing rights (SDR, in its acronym in English) in favor of the most vulnerable populations.
The cabinet of the French president, Emmanuel Macron, who is the one who convened this summit and is the host, stressed that this money “allows us to fight poverty and build resilience over time through IMF instruments.
It was precisely Macron the one that in May 2021 had set the objective of modifying the rules for attributing SDRs, which are a kind of international reserve asset regulated by the IMF, so that they could be used in favor of African countries.
The special drawing funds constitute one of the North-South solidarity mechanisms when large-scale economic crises occur, but the rules in force until now conditioned their attribution to the weight of each country in the world economy.
That meant that African countries (and the poorest countries in general) could only receive a very small part and that is what has changed now.
On the other hand, the BM He indicated in a statement that he has launched a Private Sector Investment Laboratory that is going to look for a way to overcome the obstacles that prevent private investment from nurturing emerging markets more massively.
The objective of this new structure will be to resort to “new approaches and recommendations” to obtain capital in quantities much higher than the current ones.
It will try to expand the financing of the energy transition initially focused on renewable energy and energy infrastructure.
He BM He insisted that every year they are needed “trillions of dollars of investment in emerging markets and developing countries to make adequate progress towards climate goals, manage climate change risks and tackle poverty”.
No specific decisions are expected at this Paris summit, but a palette of options is expected so that at least some of them materialize in the coming months and thus achieve “a funding shock”, according to Macron’s words.
Among these options are the creation of a new tax on maritime transport, but also an in-depth reform of the operating rules of the IMF and of the BMinstitutions born at the end of World War II.
Source: EFE
Source: Gestion
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