§ 45. Mr. Hooley
asked the Chancellor o f the Exchequer what is the policy of Her Majesty's Government as to the creation by the International Monetary Fund of special drawing rights specifically to meet the needs of developing countries.
§ Sir Geoffrey Howe
I welcome the review which is to be undertaken by the executive board on the latest trends in growth, inflation and international liquidity. The aim is to enable the managing director of the fund to determine, by the next meeting of the Interim Committee, whether a proposal for a new SDR allocation would command broad support among members of the fund. If there is to be an allocation, the review will need, under the criteria set out in the articles, to establish a long-term global need for liquidity. The forthcoming review, in common with earlier ones, may be expected to consider the case for a limited allocation, though the main requirement at present is to encourage adjustment by providing conditional finance. An allocation of SDRs for developing countries alone would of course require the amendment of the articles.