Special Drawing Rights (SDRs) Utilization
SDRs are not a currency, nor a claim on the IMF, but a potential claim on freely usable currencies of IMF members with potential uses for development and climate finance.
2030 Goals
- Increase the capacity of the Resilience and Sustainability Trust (RST) and the Poverty Reduction and Growth Trust (PRGT) to manage and deploy rechanneled SDRs.
- Identify and utilize alternative prescribed holders, beyond the IMF, to rechannel SDRs for more innovative uses.
- Explore the potential for periodic allocations of SDRs and consider decoupling SDRs from IMF quotas.
- The IMF 2030 Action Agenda includes reforms that aims to increase the scope and efficiency of re-channeling SDRs.
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- Recent developments in SDRs include the IMF's historic $650bn allocation in August 2021 to provide global liquidity during the COVID-19 pandemic.
- The IMF's Resilience and Sustainability Trust uses SDRs to support low-income and vulnerable middle-income countries in addressing climate change challenges.
- Efforts are also underway to reallocate unused SDRs from advanced economies to vulnerable countries by the G20. Also, the MDBs, such as the AfDB, advocate for SDR reallocations to boost their lending capacity for sustainable projects.
- In a significant development in May 2024, the IMF approved the use of SDRs for the acquisition of hybrid capital. This decision allows member countries to use their SDRs to invest in financial instruments that possess both equity and debt characteristics, issued by prescribed holders.
Relevant Actors & Audiences
Multilateral Development Banks
World Bank , African Development Bank (AfDB), Inter-American Development Bank (IDB)
International Organizations
International Monetary Fund
Leading Countries and Alliances
G20 Ministries of Finance
International Financial Architecture Working Group
Milestones
The below events contain milestones related to SDR Utilization.
April
April 21-26 2025Washington DC, US
WBG/IMF Spring Meetings 2025
Milestones
Special Drawing Rights (SDRs) Utilization
- An expert working group is announced, with participation from EMDEs, to explore how SDRs can be operationalized as part of a blended finance instrument.
June
June 30 - July 03 2025Sevilla, Spain
4th International Conference on Financing for Development
Milestones
Special Drawing Rights (SDRs) Utilization
- MDBs, such as AfDB and IDB, pilot issuing hybrid instruments, demonstrating SDR leverage potential.
October
October 13-18 2025Washington DC, US
WBG/IMF Annual Meetings 2025
Milestones
Special Drawing Rights (SDRs) Utilization
- IMF refines the policy frameworks for reallocating SDRs through innovative financial mechanisms.
Resources
The below resources all pertain to the topic of SDR Utilization.
Special Drawing Rights (SDRs) and Hybrid Capital
Fiscal Space, Special Drawing Rights (SDRs) Utilization
Factsheet by the Inter-American Development Bank