IMF - Spring Mtgs & Jt. Econ Cmte. (fwd)

[Robert Weissman <rob@essential.org>]

World Bank, IMF prepare spring meetings
Date: Thu Apr 09 11:05:36 CDT 1998
                                         
        WASHINGTON, April 9 (UPI) -- The World Bank and the Interna-
tional Monetary Fund are scheduled to hold their spring meetings next
week in Washington, amid questions about their mission and depleted
resources in the wake of the Asian financial crisis. 
        Meanwhile, in the U.S. Congress, the Clinton administration's
efforts to obtain additional funds for the IMF are still mired in
domestic politics. 
        For the past three years the World Bank and the IMF have led
the force of multilateral agencies and industrialized governments
putting out the fires of financial crises around the world, and
picking up the pieces to save the global economy from investor panic. 
       Since the 1995 financial meltdown in Mexico, the World Bank
and the IMF, prodded by the Clinton administration and backed up,
when necessary, by U.S. Treasury cash, have crafted financial assis-
tance for Brazil, Argentina, South Korea, Thailand and Indonesia. 
        Critics say the Washington-based multilateral agencies, which
have become paramount players in global economic policy, had been
unable to foresee the brewing crises and then have been impotent to
prevent their recurrence. 
        The Mexico rescue entailed some $40 billion in loans and
credit guarantees from the U.S. Treasury and the multilateral agen-
cies. Last year the IMF assigned some $21 billion for the $60 billion
package for South Korea and led the way in the $4 billion package for
Thailand and the $40 billion assistance for Indonesia. 
        Hubert Neis, of the IMF Asia-Pacific Department, said in
Jakarta the Fund has built safeguards into the economic reform/bail-
out agreement with the Indonesian government, to ensure the implemen-
tation of its provisions and ``a maximum degree of certainty that
this program will not remain just on paper, but will become step-by-
step reality.'' 
        The repeated withdrawals from the IMF treasury have left the 
institution with a $44 billion crisis fund. The IMF could also use a
$25 billion credit line backed up by the United States and other 10 
governments. 
        Clinton's request to Congress for an additional $18 billion  
allocation for the IMF has been held hostage for months by U.S.
domestic politics. Some lawmakers want any new allowance to be linked
to a ban on the use of U.S. funds for population control programs
that advise abortion anywhere in the world. 
        Opposition to new IMF funds comes from both left and right in
U.S. Congress, where the Senate has already passed legislation
authorizing an increase in IMF funding of $18 billion. 
        The chairman of the House Banking Oversight Committee, Rep.
Spencer Bachus, (R-Ala.), and Rep. Bernard Sanders, (I-Vt.), the only
member of U.S. Congress who calls himself a socialist, say they want
the House to hold hearings in the IMF fundings. 
        ``There are no conditions put on that funding,'' Bachus said.
``There are no reform requirements of the IMF, it is a blanket, no
conditions grant of $18 billion authority guaranteed by the taxpayers
of this country.'' 
                
 
U.S. funding share at IMF is understated-lawmakers
Date: Thu Apr 09 16:05:41 CDT 1998
                                         
         WASHINGTON, April 9 (Reuters) - The Clinton administration  
"grossly" understates Washington's financial role at the Interna-
tional Monetary Fund, a congressional committee said on Thursday in a
report urging the United States to open the IMF's books. 
         The Joint Economic Committee's report concluded that more  
than 52 percent of usable IMF resources were contributed by the
United States. Neither the IMF nor the U.S. Treasury had any
immediate comment. 
         Committee staff said it was misleading to say that the
United States provided only 18 percent of funding at the IMF -- the
figure given by the IMF and by the Clinton administration. 
         "The share of the U.S. contributions to the IMF is grossly  
understated by the Treasury Department and the IMF," Committee
Chairman Jim Saxton, a New Jersey Republican, said in a statement. 
         The committee said the IMF classified $127.6 billion, or 65 
percent, of the $196 billion paid in by member countries, as "non-
usable." This meant that more than half of the $68.4 billion of
usable IMF resources was supplied by the United States. 
         "Only by including contributions that can't be used can the 
U.S. share be driven down to 18 percent," said Saxton. 
         The administration wants Congress to provide $18 billion to 
replenish IMF resources, drained by multibillion dollar rescue deals
for Indonesia, South Korea and Thailand. 
         The Senate has approved the request, but the package has  
stalled in the House, amid criticism from Democrats and Republicans. 
         Many lawmakers say the United States already contributes too 
much money to the IMF and accuse the lending agency of being too
secretive. 
         Saxton said the committee's report should encourage Congress 
to seek sweeping reforms at the IMF, which was set up after World War
Two to promote international trade and stable exchange rates. 
         "Once Congress becomes fully aware of the larger U.S. share 
of the IMF burden, we will be even more inclined to require IMF
reforms," he said. "The House of Representatives has every right to
insist on transparency and efficiency in IMF operations." 
         Saxton said the committee's report was based on an analysis 
of previously unpublished IMF data. 
         In March Saxton and House Republican Leader Dick Armey of
Texas introduced legislation that would require more openness at the
IMF, and said the institution should use market interest rates,
instead of subsidized ones.