Thursday, 22 September 2011

Q: What is a Special Drawing Right?

Anyone looking at conventions involving international maritime law will soon come across the SDR or Special Drawing Right. It is used mainly in the calculation of limitations. An SDR is a creation of the IMF and is essentially like an international currency which cannot be spent. 


It's strength lies in the fact that it's value is decided by the IMF based on a 'basket of currencies' (the Dollar, Pound, Euro and Yen), so it avoids the fluctuations of a single currency when a country announces bad employment data, or a bailout etc. 

The most common concern is what one is worth (the answer is about one Euro - normally). The specific information is available directly on the IMF website, but a much easier way is to just use a conversion site like XE. The international 3 digit currency code for the SDR is actually XDR, so just scroll to the bottom of the extended currency list and choose convert XDR into whatever currency you like. 

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