t20-tf03-special-drawing-rights-c4b875f84ddf3997.pdf

The policy brief advocates for the G20 to push the IMF for a new $650 billion SDR allocation to address the intersecting debt and climate crises in the Global South. It argues that SDRs are a critical alternative to debt-based financing, as they do not require repayment and can be used for fiscal support, climate adaptation, and mitigation. The brief also recommends that the IMF revert its accounting of SDRs from liabilities to equity (as per BPM5) to prevent artificial increases in debt-to-GDP ratios and facilitate the donation of unused SDRs from advanced economies to indebted nations.

• The document proposes a new $650 billion allocation of Special Drawing Rights (SDRs) at the IMF to help Global South countries invest in Sustainable Development Goals (SDGs) and the climate emergency.
• SDRs are identified as a primary alternative financing mechanism for developing countries because they are not loans, do not require repayment to the IMF, and avoid regressive conditionalities.
• Current IMF accounting under the Balance of Payments Manual (BPM6) records SDR allocations as reserve liabilities, which the document claims creates an artificial increase in national debt levels and debt-to-GDP ratios.
• The brief recommends that the IMF revert to the BPM5 accounting standard, treating SDR allocations as equity rather than liabilities, to enable easier domestic spending and the donation of unused SDRs by wealthy nations.
• Analysis of the 2021 SDR issuance shows that developing countries were the primary active users; specifically, 94 out of 95 countries that actively used SDRs were developing nations.
• Regional data from the 2021 issuance indicates that sub-Saharan Africa used 80.5% of its $23 billion allocation for fiscal purposes, while Latin American and Caribbean countries used 47.4% of their accessible SDRs for fiscal support.
• The document argues that SDR 'rechanneling' models, such as the IMF's Resilience and Sustainability Trust (RST), are inferior to direct allocations because they increase conditionality and may raise indebtedness.

APA

Institute for Economic Justice (n.d.). t20-tf03-special-drawing-rights-c4b875f84ddf3997.pdf. https://iej.org.za/wp-content/uploads/2025/02/T20-TF03-Special-Drawing-Rights.pdf

Chicago

Institute for Economic Justice. t20-tf03-special-drawing-rights-c4b875f84ddf3997.pdf. n.d. https://iej.org.za/wp-content/uploads/2025/02/T20-TF03-Special-Drawing-Rights.pdf.

Wikipedia

{{cite report |author=Institute for Economic Justice |title=t20-tf03-special-drawing-rights-c4b875f84ddf3997.pdf |url=https://iej.org.za/wp-content/uploads/2025/02/T20-TF03-Special-Drawing-Rights.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{instituteforeconomicjusticendt20tf03specialdrawingrightsc4b875f84ddf3997pdf, author = {{Institute for Economic Justice}}, title = {{t20-tf03-special-drawing-rights-c4b875f84ddf3997.pdf}}, institution = {Institute for Economic Justice}, url = {https://iej.org.za/wp-content/uploads/2025/02/T20-TF03-Special-Drawing-Rights.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }