LONDON, United Kingdom (AFP) — G7 finance ministers have agreed to support new IMF aid for the poorest nations hit by the COVID pandemic, Britain said Friday after hosting an online gathering.

British finance minister Rishi Sunak and his G7 counterparts “support a new and sizeable International Monetary Fund (IMF) special drawing rights (SDR) allocation, helping vulnerable countries get through the current crisis”, said a statement from the Treasury.

“This significant milestone lays the groundwork for a potential agreement at the G20 and International Monetary and Financial Committee meetings in April,” it added.

Friday’s gathering, held virtually due to the coronavirus pandemic, follows a similar event in February and comes before a G7 summit in Britain later this year.

SDRs, created by the International Monetary Fund in 1969, play an influential role in global finance and help governments protect their financial reserves against global currency fluctuations.

It is also used as the basis of loans from the IMF’s crucial crisis-lending facilities.

While not a true currency itself — there are no SDR coins or banknotes — the IMF uses it to calculate its loans to needy countries, and to set the interest rates on those loans.

Friday’s statement added that SDRs would “boost members’ reserves and provide liquidity for vulnerable countries, freeing up resources to pay for crucial needs such as vaccines and food imports, and improve the buffers of emerging markets and low-income countries”.