Mexico City, August 29: Mexico will receive some USD 4 billion in special drawing rights, or SDRs, from the International Monetary Fund to bolster its reserves and liquidity, the country’s central bank said.
Banco de Mexico said the funds are part of some USD 250 billion in payments approved for IMF member countries at an April G-20 meeting to inject more liquidity into the global financial system.
The central bank also said a special IMF allocation of some USD 33 billion would be made available to the 185 member countries; the allocation will be proportionate to the countries’ relative size in the global economy.
It noted that Mexico will receive the USD 4 billion sum in two instalments, the larger of the two on Friday and the second on September 9.
The SDR is an interest-bearing IMF international reserve asset created by the IMF in 1969 to supplement its member countries’ official reserves. Its value is based on a basket of key international currencies that includes the dollar, the euro, the British pound and the yen.
Banco de Mexico said the SDRs are not related to a USD 47 billion line of credit that Mexico received from the IMF in April.
According to the IMF, an SDR allocation is a low cost way for its members to build their reserves without having to rely on more expensive domestic or external debt.
–IANS