The SDR is an international reserve asset created by the IMF to supplement the official reserves of its member countries.
The SDR is not a currency. It is a potential claim on the freely usable currencies of IMF members. As such, SDRs can provide a country with liquidity.
A basket of currencies defines the SDR: the US dollar, Euro, Chinese Yuan, Japanese Yen, and the British Pound.
Since the onset of the pandemic, SDR channeling (and equivalent currency amounts) has helped many countries in need, especially those eligible for financial support from the IMF’s Poverty Reduction and Growth Trust (PRGT) and the Resilience and Sustainability Trust (RST).
Since 2020, channeling of about $55 billion is providing the PRGT with the capacity to mobilize interest-free loans to our poorest members, amounting to about $34 billion through 2024. This financing helps support growth enhancing reforms in these countries. So far, these loans have benefited 57 countries and could benefit more in the years ahead.
Channeling has also supported the operations of the RST, which delivers affordable long-term financing to help vulnerable countries tackle long-term challenges including climate change. To date, 23 RST partners have channeled about $46 billion to the RST, which is expected to contribute toward meeting an estimated $29 billion in affordable financing.
The Nicaraguan economy is experiencing robust growth. Real GDP growth accelerated to around 4½ percent in 2023 and the first half of 2024, from about 3.8 percent in 2022, on the back of robust domestic demand, while inflation is moderating. Prudent macroeconomic policies and record-high remittances sustained this performance, a decrease in the estimated poverty ratio, and also led to twin surpluses, a steady decline in debt, and the accumulation of strong buffers. Gross international reserves reached US$5.7 billion, or 7.2 months of imports, by end-October 2024. The economy remains open and resilient, after confronting multiple large shocks, and on a backdrop of transfers of private property to the state, international sanctions, and reorientation of official financing. Going forward, domestic and international political developments may impact economic performance, by potentially increasing the cost of doing business and impacting other cross-border flows.
After reaching 5.1 percent in 2023, growth is expected to slow to 3.9 percent in 2024, while inflation would decline to 8.2 percent. The banking sector remains resilient amid continued rapid consumer credit growth. A moderate current account deficit is expected this year. The outlook is subject to elevated risks, including from an uncertain external environment. Decisive reforms are necessary to diversify the economy, make growth higher and more inclusive, and address challenges from climate change.
Following the January 14 presidential election, President Azali announced a new cabinet in July, introducing several new and youthful faces into the political scene. Amid this political transition, Comoros’ economy is showing signs of softening coupled with inflationary pressures driven by accelerating food prices. Credit to the private sector has slowed throughout this year as importers deleveraged following the significant ramp-up in borrowing over the last two years to meet high import prices. Import volumes—notably food products—have declined during 2024H1 while exports and public investment have both been lower than expected. Tax revenue administration efforts were hampered by post-elections unrest, the cholera epidemic, and severe weather events during the first half of 2024. Nonetheless, the external sector remains stable with adequate reserve cover above 7 months of imports.
Zambia faces a severe drought, sharply reducing agricultural and electricity output and leading to extensive load shedding. In response, the authorities expanded social cash transfers to support affected households. Multilateral financing has eased fiscal and balance of payments pressures. Despite these challenges, policy adjustment and reforms are supporting macro stability and fiscal and debt sustainability.
The 2024 Article IV Consultation discusses Chad’s post-pandemic recovery picked up steam in 2023 with growth increasing to 4.9 percent. Economic growth is projected to decline to 3.1 percent in 2024 on account of the impact of the recent floods and a slight decline in oil production but would rebound in the medium term owing to sustained public investment and structural reforms. Risks to the outlook are substantial and tilted to the downside and include potential delays in implementing fiscal consolidation measures, a larger-than-expected decline in oil prices, an increase in the influx of Sudanese refugees, and a further increase in the frequency and severity of climate change-related events. Restructuring plans aimed at improving the operational and financial performance of the two systemic public banks while providing for their recapitalization need to be adopted and implemented expeditiously. Strengthening governance and anticorruption frameworks, together with measures to improve education, increase access to basic infrastructure, and promote formalization and financial inclusion, will be essential to create a favorable business environment.
Spillovers from the war in Sudan have worsened South Sudan’s macroeconomic imbalances and exacerbated an already-dire humanitarian situation. A pipeline carrying 70 percent of South Sudan’s oil production through Sudan has been inoperable since February 2024 and repairs have taken longer than expected owing to restricted access to the concerned areas. This has caused a sharp drop in economic growth, exports, fiscal revenue, and FX inflows and led to difficult policy challenges including high inflation, rapid parallel market exchange rate (ER) depreciation, and budget financing constraints. To cope with the shock, the authorities incurred salary arrears and monetary financing, in the face of limited alternative financing, as well as delaying the official ER adjustment. Nearly two-thirds of South Sudan’s population was exposed to acute food insecurity prior to the Sudan conflict and the situation has worsened due to floodings and a growing number of refugees. The national unity government which has been in place since 2018, consistent with the peace treaty, recently announced that the elections initially planned for December 22, 2024 have been postponed by two years. Program review.
The Nicaraguan economy is experiencing robust growth. Real GDP growth accelerated to around 4½ percent in 2023 and the first half of 2024, from about 3.8 percent in 2022, on the back of robust domestic demand, while inflation is moderating. Prudent macroeconomic policies and record-high remittances sustained this performance, a decrease in the estimated poverty ratio, and also led to twin surpluses, a steady decline in debt, and the accumulation of strong buffers. Gross international reserves reached US$5.7 billion, or 7.2 months of imports, by end-October 2024. The economy remains open and resilient, after confronting multiple large shocks, and on a backdrop of transfers of private property to the state, international sanctions, and reorientation of official financing. Going forward, domestic and international political developments may impact economic performance, by potentially increasing the cost of doing business and impacting other cross-border flows.
After reaching 5.1 percent in 2023, growth is expected to slow to 3.9 percent in 2024, while inflation would decline to 8.2 percent. The banking sector remains resilient amid continued rapid consumer credit growth. A moderate current account deficit is expected this year. The outlook is subject to elevated risks, including from an uncertain external environment. Decisive reforms are necessary to diversify the economy, make growth higher and more inclusive, and address challenges from climate change.
Following the January 14 presidential election, President Azali announced a new cabinet in July, introducing several new and youthful faces into the political scene. Amid this political transition, Comoros’ economy is showing signs of softening coupled with inflationary pressures driven by accelerating food prices. Credit to the private sector has slowed throughout this year as importers deleveraged following the significant ramp-up in borrowing over the last two years to meet high import prices. Import volumes—notably food products—have declined during 2024H1 while exports and public investment have both been lower than expected. Tax revenue administration efforts were hampered by post-elections unrest, the cholera epidemic, and severe weather events during the first half of 2024. Nonetheless, the external sector remains stable with adequate reserve cover above 7 months of imports.
Zambia faces a severe drought, sharply reducing agricultural and electricity output and leading to extensive load shedding. In response, the authorities expanded social cash transfers to support affected households. Multilateral financing has eased fiscal and balance of payments pressures. Despite these challenges, policy adjustment and reforms are supporting macro stability and fiscal and debt sustainability.
The 2024 Article IV Consultation discusses Chad’s post-pandemic recovery picked up steam in 2023 with growth increasing to 4.9 percent. Economic growth is projected to decline to 3.1 percent in 2024 on account of the impact of the recent floods and a slight decline in oil production but would rebound in the medium term owing to sustained public investment and structural reforms. Risks to the outlook are substantial and tilted to the downside and include potential delays in implementing fiscal consolidation measures, a larger-than-expected decline in oil prices, an increase in the influx of Sudanese refugees, and a further increase in the frequency and severity of climate change-related events. Restructuring plans aimed at improving the operational and financial performance of the two systemic public banks while providing for their recapitalization need to be adopted and implemented expeditiously. Strengthening governance and anticorruption frameworks, together with measures to improve education, increase access to basic infrastructure, and promote formalization and financial inclusion, will be essential to create a favorable business environment.
Spillovers from the war in Sudan have worsened South Sudan’s macroeconomic imbalances and exacerbated an already-dire humanitarian situation. A pipeline carrying 70 percent of South Sudan’s oil production through Sudan has been inoperable since February 2024 and repairs have taken longer than expected owing to restricted access to the concerned areas. This has caused a sharp drop in economic growth, exports, fiscal revenue, and FX inflows and led to difficult policy challenges including high inflation, rapid parallel market exchange rate (ER) depreciation, and budget financing constraints. To cope with the shock, the authorities incurred salary arrears and monetary financing, in the face of limited alternative financing, as well as delaying the official ER adjustment. Nearly two-thirds of South Sudan’s population was exposed to acute food insecurity prior to the Sudan conflict and the situation has worsened due to floodings and a growing number of refugees. The national unity government which has been in place since 2018, consistent with the peace treaty, recently announced that the elections initially planned for December 22, 2024 have been postponed by two years. Program review.
