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ECB's Stark raps move to boost IMF drawing rights

Published 04/07/2009, 02:47 AM
Updated 04/07/2009, 02:56 AM

FRANKFURT, April 7 (Reuters) - European Central Bank Executive Board member Juergen Stark was quoted on Tuesday as criticising decisions made at last week's G20 summit to boost the IMF's Special Drawing Rights (SDRs).

Last week G20 leaders agreed to support a general allocation of $250 billion worth of International Monetary Fund's Special Drawing Rights (SDRs) alongside other measures to boost the Fund's firepower.

"That is pure money creation. That is helicopter money for the globe," Stark was quoted as saying about the SDR increase in article in German business daily Handelsblatt.

He also questioned whether the decision had been properly thought through. "There was no examination of whether there is a global need for additional liquidity at all," he said. "One used to take a lot of time to examine something like this."

The IMF created SDRs in 1969 as a way to support its 185 member countries and they are allocated according to members' IMF quotas, which are broadly based on a country's relative size in the world economy and which determines its voting power.

(Reporting by Marc Jones; editing by David Stamp)

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