Bill Summary
This legislation, called the "International Financial Institutions Mobilization Act of 2022", aims to authorize the United States to contribute to international financial institutions in order to help member countries build resilience and address rising levels of debt. It also outlines specific policies and strategies for the United States to lead and cooperate with other countries and institutions in addressing debt and economic issues, particularly in emerging market and developing countries. The Act also authorizes appropriations for loans to the International Monetary Fund and other financial institutions, as well as contributions to the twentieth replenishment of the resources of the International Development Association and the twelfth replenishment of the Asian Development Fund. It also calls for support for reforms and a new business model for the Inter-American Development Bank to increase private investment and address social and environmental challenges. Finally, the Act authorizes the United States to subscribe to additional shares of stock in IDB Invest to further support its mission and goals.
Possible Impacts
1. The legislation could affect people in emerging market and developing countries by potentially providing them with financial assistance and relief from unsustainable debt, as well as promoting better debt management and transparency standards.
2. The legislation could also have an impact on private creditors, as they may be required to provide financing to petitioner countries and could face consequences for not upholding their initial commitments.
3. The legislation could impact the availability and affordability of COVID-19 vaccinations and treatments in emerging market and developing countries, as it seeks to promote and finance international initiatives for this purpose.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 4617 Introduced in Senate (IS)]
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117th CONGRESS
2d Session
S. 4617
To authorize contributions to international financial institutions to
help build the resilience of member countries, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
July 26, 2022
Mr. Menendez introduced the following bill; which was read twice and
referred to the Committee on Foreign Relations
_______________________________________________________________________
A BILL
To authorize contributions to international financial institutions to
help build the resilience of member countries, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``International Financial Institutions
Mobilization Act of 2022''.
SEC. 2. STATEMENT OF POLICY ON UNITED STATES LEADERSHIP AT
INTERNATIONAL FINANCIAL INSTITUTIONS.
It is the policy of the United States--
(1) to recognize rising debt stock in emerging market and
developing countries as a national security and economic
security threat and raise its importance in multilateral fora;
(2) to leverage the voice and vote of the United States at
international financial institutions to prevent future
unsustainable debt stocks in emerging market and developing
countries;
(3) to promote rule-writing standards for transparency and
disclosure that hold both debtors and creditors accountable,
allow accurate debt sustainability assessments, and promote
better debt management;
(4) to lead the international community in translating the
G20 Common Framework for Debt Treatments beyond the Debt
Service Suspension Initiative (commonly known as the ``Common
Framework'') into tangible action, including effective
standstill for debt payments and credit revisions for
petitioner countries and finalizing the debt treatment for the
petitioner countries, beginning with Chad, Ethiopia, and
Zambia;
(5) to reduce timelines and increase confidence in outcomes
for the Common Framework so that private creditors continue to
provide sufficient finances to petitioner countries and other
countries witness the benefits of petitioning;
(6) to expand the Common Framework and offer its financial
assistance to other heavily indebted lower-middle-income
countries, beyond those currently covered;
(7) to cooperate with counterparts in the Group of Twenty
(G20), international financial institutions, private credit
rating agencies, and regulators to explore and develop new bond
and loan contract issuance standards that authorize temporary
suspensions of debt services to both private and public
creditors without triggering a default in crisis situations;
(8) to engage with petitioner countries, before those
countries exhaust their reserves, to strategize their ascension
into the Common Framework and prevent further economic costs;
(9) to leverage the voice and vote of the United States in
the International Monetary Fund and the World Bank so that the
Fund and the Bank complete preliminary assessments of the debt
relief needed by each country eligible for Common Framework
treatment before such countries petition for debt relief;
(10) that assessments described in paragraph (9) should--
(A) include realistic growth and fiscal
projections;
(B) include implications of Common Framework debt
relief; and
(C) be based on accurate and comprehensive debt
data;
(11) to support international financial institutions
lending into arrears for the Common Framework in the case that
private lenders fail to uphold their initial commitments;
(12) to leverage the voice and vote of the United States at
international financial institutions to promote and finance
international initiatives to procure and deploy more affordable
and accessible COVID-19 vaccinations and treatments for
emerging market and developing countries; and
(13) to address the near-term problems associated with the
pandemic-induced global recession and longer term problems of
unsustainable credit lending and borrowing that victimize
emerging market and developing countries.
SEC. 3. LOANS TO INTERNATIONAL MONETARY FUND FACILITIES AND TRUST
FUNDS.
(a) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
the Secretary of the Treasury for fiscal year 2023,
$20,000,000, for contribution to the Poverty Reduction and
Growth Trust or the Resilience and Sustainability Trust of the
International Monetary Fund.
(2) Availability of amounts.--Amounts appropriated pursuant
to the authorization of appropriations under paragraph (1)
shall remain available until December 31, 2031.
(b) Loans Authorized.--
(1) In general.--The Secretary of the Treasury may make
loans to the Poverty Reduction and Growth Trust or the
Resilience and Sustainability Trust of the International
Monetary Fund.
(2) Use of amounts.--Amounts described in paragraph (3)
shall be available--
(A) to cover the cost (as defined in section 502 of
the Congressional Budget Act of 1974 (2 U.S.C. 661a))
of loans authorized under paragraph (1); and
(B) to subsidize gross obligations for the
principal amount of such loans, not to exceed
$21,000,000,000 in the aggregate.
(3) Amounts described.--Amounts described in this paragraph
are--
(A) amounts appropriated pursuant to the
authorization of appropriations under subsection (a);
and
(B) amounts--
(i) appropriated under the heading
``Contributions to the International Monetary
Fund Facilities and Trust Funds'' in any Act
making appropriations for the Department of
State, foreign operations, and related programs
for a fiscal year before fiscal year 2023; and
(ii) available for obligation as of the
date of the enactment of this Act.
(4) Authorization of certain transactions.--The Exchange
Stabilization Fund established under section 5302 of title 31,
United States Code, and the financing account corresponding to
transactions with the International Monetary Fund are
authorized to enter into such transactions as are necessary to
effectuate loans authorized under paragraph (1).
SEC. 4. INTERNATIONAL DEVELOPMENT ASSOCIATION TWENTIETH REPLENISHMENT.
The International Development Association Act (22 U.S.C. 284 et
seq.) is amended by adding at the end the following:
``SEC. 32. TWENTIETH REPLENISHMENT.
``(a) In General.--The United States Governor of the International
Development Association is authorized to contribute on behalf of the
United States $3,500,000,000 to the twentieth replenishment of the
resources of the Association, subject to obtaining the necessary
appropriations.
``(b) Authorization of Appropriations.--In order to pay for the
United States contribution provided for in subsection (a), there are
authorized to be appropriated, without fiscal year limitation,
$3,500,000,000 for payment by the Secretary of the Treasury.''.
SEC. 5. ASIAN DEVELOPMENT FUND TWELFTH REPLENISHMENT.
The Asian Development Bank Act (22 U.S.C. 285 et seq.) is amended
by adding at the end the following:
``SEC. 37. TWELFTH REPLENISHMENT.
``(a) In General.--The United States Governor of the Bank is
authorized to contribute, on behalf of the United States, $177,440,000
to the twelfth replenishment of the resources of the Fund, subject to
obtaining the necessary appropriations.
``(b) Authorization of Appropriations.--In order to pay for the
United States contribution provided for in subsection (a), there are
authorized to be appropriated, without fiscal year limitation,
$177,440,000 for payment by the Secretary of the Treasury.''.
SEC. 6. SUPPORT FOR INTER-AMERICAN DEVELOPMENT BANK GROUP REFORM AND
IDB INVEST CAPITAL INCREASE.
(a) Support for Reform of Inter-American Development Bank Group.--
The Secretary of the Treasury shall instruct the United States
Executive Director of the Inter-American Development Bank (in this
section referred to as the ``Bank'') to use the voice and vote of the
United States to take steps to advance operational and institutional
reforms to improve the effectiveness of the Inter-American Development
Bank Group and accelerate modernization efforts that strengthen its
responsiveness to the varied development challenges of the countries of
Latin America and the Caribbean, with particular attention to enhancing
the region's ability to attract private investment, increase social
inclusion, and raise climate ambition.
(b) Support for New Business Model for IDB Invest.--
(1) In general.--The Secretary shall instruct the United
States Executive Director of the Bank to use the voice and vote
of the United States to take steps to advance a proposal for a
new vision and business model for the Inter-American Investment
Corporation (commonly known as ``IDB Invest'') to increase
sustainable and inclusive private investment in Latin America
and the Caribbean, including--
(A) elaboration on the financial, resource,
operational, and institutional implications, such as
the potential recalibration of shareholding at the
Board of Directors of IDB Invest, of implementing the
new vision and business model; and
(B) as necessary, the redesign and modification of
the management of IDB Invest to reflect the new vision
and business model.
(2) Contingent support for increase in capital stock of idb
invest.--
(A) In general.--If and when the Boards of
Directors of the Bank and the IDB Invest endorse a
proposal described in paragraph (1), the Secretary
shall commence negotiations for an increase in the
authorized capital stock of IDB Invest.
(B) Consultations.--The Secretary shall consult
with the Committee on Foreign Relations of the Senate
and the Committee on Financial Services of the House of
Representatives regarding the progress of any
negotiations described in subparagraph (A), including
with respect to anticipated timelines for such
negotiations.
(c) Authorization to Subscribe to Additional Shares of Stock of IDB
Invest.--
(1) Sense of congress.--It is the sense of Congress that
the United States Governor to the Bank should use the voice and
vote of the United States to take steps--
(A) to redouble the commitment of the United States
to IDB Invest and the Inter-American Development Bank
Group; and
(B) to double the financial capacity of IDB Invest.
(2) Authorization.--
(A) In general.--After a decision by the Board of
Governors of IDB Invest to increase the authorized
capital stock of IDB Invest, the United States Governor
is authorized to subscribe on behalf of the United
States to additional shares of stock in such amounts as
the Governor considers appropriate, subject to
subparagraph (B).
(B) Limitation.--The United States Governor may not
subscribe on behalf of the United States to additional
shares of stock in IDB Invest if such additional shares
would result in the share of stock held by the United
States in IDB Invest to exceed the share of stock held
by the United States in the Bank.
(3) Report required.--
(A) In general.--Not later than 15 days after the
conclusion of negotiations described in subsection
(b)(2) and not less than 15 days before the United
States Governor subscribes on behalf of the United
States to additional shares of stock in IDB Invest
under paragraph (2), the Secretary shall submit to the
Committee on Foreign Relations of the Senate and the
Committee on Financial Services of the House of
Representatives a report setting forth--
(i) the amount of the proposed increase in
the capital stock of IDB Invest;
(ii) the amount of shares proposed for
subscription by the United States in connection
with the proposed increase;
(iii) the share of the stock of IDB Invest
held by each member country and the
corresponding change in that share associated
with the proposed increase;
(iv) the anticipated increased financing
levels to be achieved by the proposed increase;
(v) the expected financial and operational
impact of the proposed increase, including a
description of relevant institutional reforms
by IDB Invest; and
(vi) a description of whether the Bank and
IDB Invest are successfully responding to the
mandates outlined by their respective Boards of
Governors in resolutions AG-7/22 and CII/AG-3/
22 of March 28, 2022.
(4) Authorization of appropriations.--There are authorized
to be appropriated such sums as may be necessary to pay for the
subscription to additional shares of stock in IDB Invest
authorized by paragraph (2).
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