The G20 communiqué is officially out.
Among the collective promises to persecute stamp-out tax havens, is this interesting little decision on IMF special drawing rights (SDRs):
19. We have agreed to support a general SDR allocation which will inject $250 billion into the world economy and increase global liquidity, and urgent ratification of the Fourth Amendment.
We all knew the G20 had already provisionally agreed to beef IMF funds from the draft communiqué published in the FT last week, but it is worth noting that the draft as it appeared then left a crucial blank on the issue of SDRs:
8. We have agreed a general SDR allocation of $[x] to strengthen global liquidity.
The key point being that the the above represents no less than 10 times the current value of SDRs in circulation and is a clear capitulation by the US on the issue of approving the Fourth Amendment. As background – the US was one of the last major IMF members to ratify the 1997 instituted proposal to create a special one-time allocation of SDRs. Except, of course, that particular proposal was focused on doubling cumulative SDR allocations to SDR42.8bn.
Either way it’s an all-round G20 capitulation to the ideas of George Soros, who pitched for exactly this measure as early as October last year.
It’s also very much in line with the call coming from G20 protesting group Avaaz, who earlier on Thursday petitioned the UK government as follows:
The petition calls on leaders and officials at the G20 Summit for bold action on stimulus, regulation and reform — to invest in a sustainable green recovery, to fundamentally reform the international financial institutions, and to *create $250 billion of new international reserve funds (“SPECIAL DRAWING RIGHTS”)* — a key point of contention at the summit.
As the group — which describes itself as a web-based mass movement of 3.4m citizens with a positive policy agenda for the G20 summit — very succinctly explained it in their own communique, the SDR issue was one of the most contentious issues at the summit:
They are a key point of contention around the summit, with some countries opposing this measure and others seeking to turn SDRs into a global reserve currency to replace the dollar.
They’ve dubbed a decision on SDRs as “onward to a new Bretton Woods”.
Related links:
A paper-gold reserve system? - FT Alphaville
Geithner not wrong, simply misunderstood – FT Alphaville
Two very different SDR scenarios, says Rogoff – FT Alphaville
Is a global super-currency on the agenda? – FT Alphaville
=XDR (or, one special drawing right) – FT Alphaville
One giant drop of cash for mankind? - FT Alphaville