Special Drawing Rights

Overview

The SDR is an international reserve asset created by the IMF to supplement the official reserves of its member countries.

The SDR is not a currency. It is a potential claim on the freely usable currencies of IMF members. As such, SDRs can provide a country with liquidity.

A basket of currencies defines the SDR: the US dollar, Euro, Chinese Yuan, Japanese Yen, and the British Pound.

What is the SDR?

Factsheet: Special Drawing Rights (SDR)
The SDR is an international reserve asset, created by the IMF in 1969 to supplement its member countries’ official reserves. To date, a total of SDR 660.7 billion (equivalent to about US$943 billion) have been allocated. This includes the largest-ever allocation of about SDR 456 billion approved on August 2, 2021 (effective on August 23, 2021). This most recent allocation was to address the long-term global need for reserves, and help countries cope with the impact of the COVID-19 pandemic. The value of the SDR is based on a basket of five currencies—the U.S. dollar, the euro, the Chinese renminbi, the Japanese yen, and the British pound sterling.
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What's New

Poverty Reduction and Growth Trust―2022: Borrowing Agreements With The Government of Canada As Represented By The Minister Of Finance, The Bank Of Italy, The Government Of Japan, And The Bank Of Spain
November 11, 2022

This paper presents the first set of borrowing agreements that have been finalized as part of the loan mobilization round launched in July 2021 to cover the cost of pandemic-related lending and support the self-sustainability of the Poverty Reduction and Growth Trust (PRGT). All agreements presented use SDRs in the context of SDR channeling and together provide a total of SDR 2.85 billion in new PRGT loan resources for low-income countries (LICs).

Annual Update on SDR Trading Operations
October 6, 2022

This paper provides an update on the status of the SDR trading market and operations one year after the historic fourth general allocation of SDRs. In the reporting period, SDR trading has been dominated by SDR sales due to the 2021 SDR allocation. The VTAs continue to have ample capacities to meet the demand for exchange of SDRs into currencies. Staff has made significant progress in further strengthening the SDR trading market. Since the SDR allocation, eight new VTA members have been welcomed to the SDR trading market and many existing VTA members provided additional operational flexibilities. Discussions with a number of potential new entrants continue in the broader context of SDR channeling, which encourages contributors to have VTAs.

Review of the Method of Valuation of the SDR— Amendment to Rule O-1
July 29, 2022

This paper seeks Executive Board approval of an amendment to Rule O-1 of the IMF’s Rules and Regulations, which specifies the currency amounts in the SDR valuation basket In accordance with Decision No. 17247-(22/44), adopted May 11, 2022, on the method of valuation of the SDR and Decision No. 16033-(16/17), adopted July 20, 2016 on the guidelines for the calculation of currency amounts in the SDR valuation basket, the amounts of each currency included in the SDR valuation basket, effective August 1, 2022, have been determined. These currency amounts are calculated in accordance with long-standing principles of continuity and stability of the SDR value in terms of currencies. The calculations ensure that on the transition day (today), the value of the SDR in U.S. dollars is the same under the new and the prevailing SDR valuation baskets. Moreover, at the average exchange rates for the three-month period ending today (May 2 through July 29, 2022), the share of each currency in the value of the SDR corresponds to the weight approved by the IMF Executive Board on May 11, 2022.

Burundi: 2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Burundi
July 29, 2022

This 2022 Article IV Consultation discusses that Burundi’s economy continues to navigate the challenging headwinds presented by the coronavirus disease 2019 pandemic and the impact of the war in Ukraine. Burundi’s public debt is sustainable; however, the risk of external debt distress is high. External imbalances are large, with reserve coverage below adequacy levels and a large parallel exchange rate market premium. Growth is expected to strengthen somewhat in 2022, to 3.3 percent, although dampened by inward spillovers of the war in Ukraine, which has compounded nascent domestic fuel shortages and transportation disruptions. Burundi is at high risk of debt distress; and debt is assessed as sustainable contingent on fiscal adjustment and robust export and growth performance. External imbalances have been exacerbated by the pandemic and inward spillovers from the war in Ukraine, with foreign exchange reserves coverage below adequacy levels and a large parallel exchange rate market premium.

Sierra Leone: 2022 Article IV Consultation and Fifth Review under the Extended Credit Facility Arrangement, Requests for Waivers of Nonobservance of Performance Criteria, Modifications of Performance Criteria, and Financing Assurance Review-Press Release; Staff Report; and Statement by the Executive Director for Sierra Leone
July 29, 2022

This paper presents Sierra Leone’s 2022 Article IV Consultation and Fifth Review under the Extended Credit Facility (ECF) Arrangement, Requests for Waivers, of Nonobservance of Performance Criteria, Modifications of Performance Criteria, and Financing Assurance Review. The economic recovery from the pandemic has been set back by the impact of the war in Ukraine and the medium-term outlook remains challenging. Successive external shocks have contributed toward mixed performance under the ECF arrangement. The authorities have committed to strong corrective actions to bring the fiscal situation under control. Sierra Leone continues to pursue its development path amidst continued vulnerability to shocks and capacity needs. Sustained efforts to strengthen governance will be essential, to reduce vulnerabilities to corruption, foster private sector development and growth, and ensure more effective delivery of public services. Ensuring the financial and operational independence of the supreme audit institution is a priority. Continued progress on human capital development, climate adaptation, and expansion of social-safety nets would be welcome.

Niger: First Review Under the Extended Credit Facility Arrangement and Request for Modification of Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Niger
July 19, 2022

This paper presents Niger’s First Review under the Extended Credit Facility Arrangement and Request for Modification of Performance Criteria. The unfolding acute food crisis and the deteriorating security situation in the Sahel region have increased fiscal pressures. The war in Ukraine is exacerbating these challenges. The near- and medium-term economic outlook for Niger is broadly favorable with growth projected to bounce back this year and accelerate thereafter with the start of oil exports through the new pipeline. A temporary deviation from fiscal targets over 2022–23 is therefore appropriate. Stepped-up efforts to improve domestic revenue mobilization and enhance spending quality will be key. A temporary deviation from fiscal targets over 2022–23 is warranted to accommodate urgent spending needs related to the food crisis and lower budget-support grants from donors. Rising financial sector vulnerabilities, including those related to deteriorating asset quality, particularly in the microfinance sector, will need to be carefully monitored. Further efforts to foster financial inclusion are also needed. Program performance has been broadly satisfactory with all quantitative performance criteria and indicative targets at end-December 2021 met. The implementation of the structural reform agenda is advancing well.

Poverty Reduction and Growth Trust―2022: Borrowing Agreements With The Government of Canada As Represented By The Minister Of Finance, The Bank Of Italy, The Government Of Japan, And The Bank Of Spain
November 11, 2022

This paper presents the first set of borrowing agreements that have been finalized as part of the loan mobilization round launched in July 2021 to cover the cost of pandemic-related lending and support the self-sustainability of the Poverty Reduction and Growth Trust (PRGT). All agreements presented use SDRs in the context of SDR channeling and together provide a total of SDR 2.85 billion in new PRGT loan resources for low-income countries (LICs).

Annual Update on SDR Trading Operations
October 6, 2022

This paper provides an update on the status of the SDR trading market and operations one year after the historic fourth general allocation of SDRs. In the reporting period, SDR trading has been dominated by SDR sales due to the 2021 SDR allocation. The VTAs continue to have ample capacities to meet the demand for exchange of SDRs into currencies. Staff has made significant progress in further strengthening the SDR trading market. Since the SDR allocation, eight new VTA members have been welcomed to the SDR trading market and many existing VTA members provided additional operational flexibilities. Discussions with a number of potential new entrants continue in the broader context of SDR channeling, which encourages contributors to have VTAs.

Review of the Method of Valuation of the SDR— Amendment to Rule O-1
July 29, 2022

This paper seeks Executive Board approval of an amendment to Rule O-1 of the IMF’s Rules and Regulations, which specifies the currency amounts in the SDR valuation basket In accordance with Decision No. 17247-(22/44), adopted May 11, 2022, on the method of valuation of the SDR and Decision No. 16033-(16/17), adopted July 20, 2016 on the guidelines for the calculation of currency amounts in the SDR valuation basket, the amounts of each currency included in the SDR valuation basket, effective August 1, 2022, have been determined. These currency amounts are calculated in accordance with long-standing principles of continuity and stability of the SDR value in terms of currencies. The calculations ensure that on the transition day (today), the value of the SDR in U.S. dollars is the same under the new and the prevailing SDR valuation baskets. Moreover, at the average exchange rates for the three-month period ending today (May 2 through July 29, 2022), the share of each currency in the value of the SDR corresponds to the weight approved by the IMF Executive Board on May 11, 2022.

Burundi: 2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Burundi
July 29, 2022

This 2022 Article IV Consultation discusses that Burundi’s economy continues to navigate the challenging headwinds presented by the coronavirus disease 2019 pandemic and the impact of the war in Ukraine. Burundi’s public debt is sustainable; however, the risk of external debt distress is high. External imbalances are large, with reserve coverage below adequacy levels and a large parallel exchange rate market premium. Growth is expected to strengthen somewhat in 2022, to 3.3 percent, although dampened by inward spillovers of the war in Ukraine, which has compounded nascent domestic fuel shortages and transportation disruptions. Burundi is at high risk of debt distress; and debt is assessed as sustainable contingent on fiscal adjustment and robust export and growth performance. External imbalances have been exacerbated by the pandemic and inward spillovers from the war in Ukraine, with foreign exchange reserves coverage below adequacy levels and a large parallel exchange rate market premium.

Sierra Leone: 2022 Article IV Consultation and Fifth Review under the Extended Credit Facility Arrangement, Requests for Waivers of Nonobservance of Performance Criteria, Modifications of Performance Criteria, and Financing Assurance Review-Press Release; Staff Report; and Statement by the Executive Director for Sierra Leone
July 29, 2022

This paper presents Sierra Leone’s 2022 Article IV Consultation and Fifth Review under the Extended Credit Facility (ECF) Arrangement, Requests for Waivers, of Nonobservance of Performance Criteria, Modifications of Performance Criteria, and Financing Assurance Review. The economic recovery from the pandemic has been set back by the impact of the war in Ukraine and the medium-term outlook remains challenging. Successive external shocks have contributed toward mixed performance under the ECF arrangement. The authorities have committed to strong corrective actions to bring the fiscal situation under control. Sierra Leone continues to pursue its development path amidst continued vulnerability to shocks and capacity needs. Sustained efforts to strengthen governance will be essential, to reduce vulnerabilities to corruption, foster private sector development and growth, and ensure more effective delivery of public services. Ensuring the financial and operational independence of the supreme audit institution is a priority. Continued progress on human capital development, climate adaptation, and expansion of social-safety nets would be welcome.

Niger: First Review Under the Extended Credit Facility Arrangement and Request for Modification of Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Niger
July 19, 2022

This paper presents Niger’s First Review under the Extended Credit Facility Arrangement and Request for Modification of Performance Criteria. The unfolding acute food crisis and the deteriorating security situation in the Sahel region have increased fiscal pressures. The war in Ukraine is exacerbating these challenges. The near- and medium-term economic outlook for Niger is broadly favorable with growth projected to bounce back this year and accelerate thereafter with the start of oil exports through the new pipeline. A temporary deviation from fiscal targets over 2022–23 is therefore appropriate. Stepped-up efforts to improve domestic revenue mobilization and enhance spending quality will be key. A temporary deviation from fiscal targets over 2022–23 is warranted to accommodate urgent spending needs related to the food crisis and lower budget-support grants from donors. Rising financial sector vulnerabilities, including those related to deteriorating asset quality, particularly in the microfinance sector, will need to be carefully monitored. Further efforts to foster financial inclusion are also needed. Program performance has been broadly satisfactory with all quantitative performance criteria and indicative targets at end-December 2021 met. The implementation of the structural reform agenda is advancing well.

Tracker on the Use of Allocated SDRs

7 Things You Need to Know about the SDR

7 Things you need to know about the SDR
Let’s start from the beginning – What is an SDR? Is it money? Special Drawing Rights (SDRs) are an asset, though not money in the classic sense because they can’t be used to buy things. The value of an SDR is based on a basket of the world’s five leading currencies – the US dollar, euro, yuan, yen and the UK pound. The SDR is an accounting unit for IMF transactions with member countries – and a stable asset in countries’ international reserves.
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IMF

Q&A

Q. How many SDRs have been allocated so far?
The Fund has allocated a total of SDR 660.7 billion (equivalent to about US$935.7 billion), including four general allocations and a one-time special allocation. Specifically:
  • SDR 9.3 billion was allocated in yearly installments in 1970–72.
  • SDR 12.1 billion was allocated in yearly installments in 1979–81.
  • SDR 161.2 billion was allocated on August 28, 2009
  • A special one-time allocation of SDR 21.5 billion took effect on September 9, 2009 to correct for the fact that members that had joined the IMF after 1981 had never received an allocation (the Fourth Amendment special allocation)
  • SDR 456.5 billion (equivalent to about US$650 billion) was allocated on August 23, 2021, by far the largest allocation to date
  • In addition, new members to the Fund receive an SDR allocation upon their participation in the SDR Department
    Q&A