Machinations inside a pair of deconstructivist-style glass towers overlooking the River Main in Frankfurt, Germany, could be all that is standing between tens of billions of dollars and countries struggling to fund their economic growth, fight pandemics, and adapt to climate change.
This story begins in October 2021, when European Central Bank chief Christine Lagarde declared that European national central banks were barred from rechanneling a valuable reserve asset known as Special Drawing Rights to multilateral development banks.
This effectively meant that high-income European countries holding hundreds of billions of dollars worth of SDRs that they didn’t need could not put them to work to help their poorer counterparts. Many of those SDRs have laid dormant in national coffers ever since.