Special Drawing Rights
| DOI | 10.1177/002070208103600402 |
| Date | 01 December 1981 |
| Author | Duncan Cameron |
| Published date | 01 December 1981 |
| Subject Matter | Money and Markets |
DUNCAN CAMERON
Special
drawing
rights
In
only
one
important
respect
must
an
International
Bank
differ
from the model
suitable
to
a
national
bank within
a
closed
system,
namely
that
much
more
must
be
settled
by
rules
and
by
general
principles
agreed
beforehand,
and
much
less
by
day
to
day
discretion.
J.M.
Keynes'
The
existence
of
Special
Drawing
Rights
(SDRS)
as
a
form
of
inter-
national
money
has
been
overshadowed
throughout
the
197os
by
generalized
international
monetary disorder.
SDRS
have
recently
been
revamped
to increase
their
attractiveness;
it
remains
to
be
seen
if
the new-look
SDR
will
take
on
more
of
the
characteristics
of
a
true
monetary
unit. Until
now
its
principal
defect
as
money
has
been
that
the
SDR
does
not
circulate
widely:
its
importance
as
a
means
of
payment
is
limited.
This
is
due
in
part
to
the limited
number
of
SDRS
in
existence
and
in
part
to
particular
features
of
the
post-SDR
world
monetary
system.
The
creation
of
the
SDR
by
the
membership
of
the
International
Monetary
Fund
(IMF)
in the
late
i16os
2
is
significant
because
it
represents the
first
successful
Assistant
Professor
of Political
Science,
University of
Ottawa; formerly with
the
Department
of
Finance
and
the
Canadian
International
Development
Agency;
author
of
Le
systdme
mondtaire
international
en
voie
de
rdforme
(1977).
As
always
Profesor
Andrew Axline
was
good
enough
to
provide
comments
on
this
article,
and
his
assistance
is
gratefully
acknowledged.
I
J.M.
Keynes,
'Proposals
for an
international
clearings
union
(second
draft),'
in
Donald
Moggridge,
ed,
The
collected
writings
of
John
Maynard
Keynes (London
sg8o),
xxv,
45.
2
The
SDR
was
brought
into
existence
by
the
first
amendment
to
the
IMF
charter.
The
board
of
governors
of
the
IMF
approved
the proposed
amendment
in
1968,
714
INTERNATIONAL
JOURNAL
attempt
by
the
nations
of
the
world
consciously
to
adopt
as
a
monetary
standard
a
fiduciary
instrument, that
is
to
say,
a
paper
money
which
depends
ultimately
on
trust
and
confidence.
Though
a
familiar
feature
of
national
monetary
systems,
the
use
of
a
fidu-
ciary
asset
internationally
is
a
considerable
achievement,
especial-
ly
in
the
absence
of
a
corresponding
world political
authority.
This
article
examines
SDRS
from
three
perspectives:
firstly,
by
investigating
the
need
for
an
international
monetary
unit;
sec-
ondly,
by
looking
at the
nature
of
SDRS
as
international
money;
and
thirdly,
by
analysing
how
SDRS
are
faring
in
the
midst
of
in-
ternational
monetary disorder.
WHY
HAVE
AN
INTERNATIONAL
MONETARY
UNIT?
A
centrally
created
international
monetary
unit
was
included
in
the
plan
for
an
international
clearings
union
put
forward
by
John
Maynard
Keynes
in
1944.
His
scheme,
which
was
discussed
exten-
sively
within
the
British Treasury,
where
its
author
was
a
wartime
official,
and
with
economists
in
Britain,
before
being
put
forward
for
negotiation
with
other
countries,
contained
provision
for
the
use
of
'bancor,'
a
bookkeeping
entry
which
could
accrue
to
na-
tions
experiencing
surpluses
in
their
international
exchanges.
Na-
tions
in
deficit
would
receive
'overdrafts'
in
the
clearings
union
by
drawing
on
their
allocation
of
bancor.
The
essence
of
the
project
was
that
nations
in
deficit
would
have
access
to
credit
quasi-
automatically
up
to
agreed
limits. Correspondingly,
nations
in
surplus
would
be
providing
credit
in
the
form
of the
bancor
over-
draft.
Keynes
considered
that
the
burden
for
adjusting
interna-
tional
imbalances
should
lie
with
the strongest
countries,
those
the
most
able
to
bear
the
burden,
the
surplus
countries.
In
any
event the
Keynes
plan
was
never
implemented,
perhaps
because
it
appeared
to
favour Great
Britain,
the
largest
potential
and
it
was
ratified
by
the
members
in
196g.
The
first
allocation
of
SDRs
was
made on
i
January
ig7o.
See
Margret
Garritsen
de
Vries,
The
International
Monetary
Fund
1966-1971:
the
system
under
stress
(2
vols;
Washington
DC
1976).,
A
second
allocation
was
made
for
the
1979-81
period.
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