ABSTRACT
The New International Economic Order calls for the ‘early establishment of a link between Special Drawing Rights (SDRs) and additional development financing in the interest of developing countries, consistent with the monetary characteristics of Special Drawing Rights”. The Bretton Woods system was primarily concerned with monetary stability and efficient balance of payments adjustment. SDRs are held only by the monetary authorities of member countries of the International Monetary Fund (IMF). Established in 1944 at an international conference held in Bretton Woods, New Hampshire, the IMF was designed to avoid some of the problems of the 1930s. Long-term deficits were expected to be resolved by currency depreciation, with the permission of the IMF. The agreement establishing the IMF was amended in 1967 to create a new reserve instrument called Special Drawing Rights, and the amendment went into effect in 1969.
