A group of lawmakers is urging the International Monetary Fund (IMF) to prevent member countries from facilitating exchanges of Russia’s Special Drawing Rights (SDRs).
The IMF created the SDR as an international reserve asset to supplement the reserves of IMF member countries. The IMF distributes these assets to member countries based on each country’s size relative to the global economy. The member countries can exchange SDRs for U.S. dollars or the currencies of other IMF members.
“The hostile invasion of Ukraine this week demonstrates why the IMF should have never approved its latest $650 billion general allocation of SDRs in August 2021. As Republicans have repeatedly raised, general SDR allocations are not targeted and have no conditions on what the SDRs can be used for,” the lawmakers wrote to Treasury Secretary Janet Yellen.
It was signed by 30 members of Congress, including U.S. Sen. Bill Hagerty (R-TN) and U.S. Rep. French Hill (R-AR)
“The Biden Administration’s support for the IMF’s $650 billion general allocation, of which more than $17 billion went to Russia, ran counter to U.S. sanctions against Moscow even before the invasion of Ukraine. We cannot allow these reserve assets to help the regime withstand the latest sanctions announced by the President, let alone offer additional billions through further allocations,” the lawmakers wrote.
Further, the lawmakers oppose any additional SDR allocations that would bolster Russia’s reserves as it wages a war against Ukraine.
“As the largest shareholder of the IMF, the United States has a responsibility to ensure that the Fund is not misused to support Russia’s warmongering in Ukraine. We urge you to take all necessary measures to prevent this,” the lawmakers concluded.