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IMF allocates 687.6 million SDR (831.5 mln euro) to Croatia – c-bank

Author Annie Tsoneva
IMF allocates 687.6 million SDR (831.5 mln euro) to Croatia  – c-bank Photo: Croatian central bank, HNB

ZAGREB (Croatia), August 27 (SeeNews) - The International Monetary Fund (IMF) allocated 687.6 million newly-issued special drawing rights (SDRs) worth 831.5 million euro ($977.2 million) to Croatia in coronavirus emergency assistance, the country's central bank said on Friday.

The money received on the basis of general allocation represent part of the foreign exchange reserves of Croatia, under management by the central bank, and Croatia cannot use them to finance its budget spending, the central bank said in a statement made available to SeeNews on Thursday evening.

The European Union member states, including Croatia, are not allowed to use funding from allocation of SDR and other forex reserves to finance budget gap or the needs of public sector because it would be considered monetary financing, which is not allowed in the European Union, it added.

In response to the latest health and economic crisis caused by the COVID-19 pandemic, the IMF board of governors decided on August 2 on a new SDR allocation of 456 billion SDRs, an equivalent to $650 billion, which was credited to IMF member countries, in SDR currency, to their SDR holdings accounts with the IMF, at certain quotas for each country.

This decision is aimed at meeting the global needs for forex in long run. The allocation boosts the liquidity of the global economic system by raising the foreign exchange reserves of each county member of the IMF, the statement added.

($= 0.8509 euro)