US President Donald Trump’s administration has just offered a gift to finance ministers from developing countries. By proposing a $20 billion currency swap line for Argentina, it has implicitly aligned itself with those arguing for a new issuance of special drawing rights (SDRs), the International Monetary Fund’s reserve asset.
Of course, many ministers, busy discussing their tight fiscal frameworks with the IMF, may have missed this. Fortunately, the gift is still on the table. The IMF and developing countries should endorse the US Treasury’s offer to Argentina but also ask for a global issuance of new SDRs. By taking up this idea, the United States could achieve a major strategic victory, even though Trump’s reasons for offering help to Argentina are primarily to support an important country for the US and strengthen ties with an ally, President Javier Milei.
Five years…
