At a recently-held meeting, the G7 has promised to back the IMF to help poor nations. However, such support needs the US or China which may be difficult to get.
G7 to back IMF financial moves
The biggest global economies have all agreed to back the policy the IMF boost reserves whose objective is to aid poor nations to cope with the effects of the coronavirus pandemic. The event which was headed by the UK this year stated that all the group economic ministers have said they will increase financial support via (SDRs) which is a private currency.
This agreement by these G7 nations will allow excellent action to help poor countries who have been left broken by the pandemic, British finance chief Rishi Sunak stated. The announcement of this agreement was applauded by IMF chief Kristalina Georgieva who said the G7 did the right thing. In 2020, the IMF said it wanted its SDRs to increase to more than $600 billion from $299 billion.
US treasury boss wants more transparency from IMF and G7
This expansion of the SDRs was opposed by the last administration in the US. However, the new treasury boss in US Mrs. Janet Yellen said while this new administration will support an expansion, they will demand better transparency from everyone. Though the approval of such policy by the US Congress seems unlikely as Republicans and Democrats are equally matched.
Already top Republicans have complained that such expansion will allow nations like China and other dictatorial nations to have free cash m. Another lawmaker French Hill said that such a move will provide financial liquidity for some of the world's brutal countries. The lawmaker also said what is the proof that it would be given to nations in need and not allies if members. The ratification of such an agreement will need to be agreed to by nations who are not G7 nations like China and America.