The new method of valuing special drawing rights

Quarterly Bulletin 1974 Q3
Published on 01 September 1974

As a result of amendments to the International Monetary Fund's Articles of Agreement in 1969, the Fund was empowered to create new international reserve assets in the form of special drawing rights (SDRs). During the following three years, 9,315 million of them were allocated to the hundred and more members of the Fund which participated in the scheme, an amount roughly equal to 12% of the total of international reserves at the end of 1969 just before the first allocation. Although their use is at present somewhat restricted by the IMF Articles, SDRs have been widely employed by members needing to draw on their reserves to make payments to other SDR holders. To date, transactions total over SDR 5,000 million. The vast majority of less developed countries have been net users of SDRs, as have been a number of developed countries including the United Kingdom: these SDRs have been acquired by other countries and by the Fund (for example, when they have been used to repay drawings from the Fund).

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