The $ 18 billion received by Russia from the International Monetary Fund (IMF) in the form of Special Drawing Rights (SDR) will become part of the country’s gold and foreign exchange reserves. Deputy Finance Minister Timur Maksimov announced this in an interview with the Russia 24 TV channel.
“This money becomes part of the gold and foreign exchange reserves of the Russian Federation. They don’t go for anything, they just increase the state reserves that we have, ”he said.
On August 23, the corresponding decision on the distribution of $ 650 billion between the IMF member countries came into force. Russia received $ 18 billion in SDR.
SDR is an artificial reserve and legal tender issued by the IMF. It has only a non-cash form in the form of entries on bank accounts. No banknotes were issued. The SDR was created by the IMF in 1969 as an addition to the existing reserve assets of member countries. The SDR value is based on a basket of five leading world currencies – the US dollar, euro, yuan, yen and British pound sterling.
Countries can exchange their SDRs for hard currency with other IMF members. Historically, this has been done on a voluntary basis, with countries in better financial position agreeing to help others when needed, the IMF website explains. Countries can also use their SDRs to meet financial obligations to the IMF. Many member countries that do not need support have used the SDR to support concessional financing for low-income countries.
The last time the SDR was allocated was in 2009 during the global financial crisis. Then the IMF allocated SDR to its member countries in an amount equivalent to $ 250 billion.
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