Dow: IMF Funding Loss (fwd)

[Robert Weissman <rob@essential.org>]

Dow Jones Newswires -- September 18, 1998

House Action On IMF Sets Up Funding Fight With Senate

 By MARK H. ANDERSON
 Dow Jones Newswires

 WASHINGTON -- The House voted late Thursday to approve only part
 of the $18 billion in funds requested for the International Monetary
 Fund, setting up a fight between House and Senate leaders over how much
 support to give the 182-country organization.

 On a vote of 229 to 188, the House backed only a $3.5 billion credit line
 for the IMF, refusing at the last stage of House legislative action to
grant an
 additional $14.5 billion in reserve replenishments.

 The IMF is reeling in the wake of Asian and Russian financial crises and is
 concerned about eruptions of economic problems in other parts of the world
 such as Latin America.

 But Clinton administration pleas with Congress to back the entirety of its
 $18 billion request have met strong resistance from House Republicans who
 have escalated criticism of the organization.

 The Senate has twice approved legislation that contains $3.5 billion of $18
 billion in funds requested for the IMF. "I don't see how we can afford not
 to" provide the requested IMF funds, Senate Appropriations Chairman Ted
 Stevens, R-Alaska, said, citing U.S. farm and export prices that have
 suffered during the world crisis. The Senate has twice backed the entire
 IMF funding package.

 Nevertheless, House resistance could force the White House to
 compromise on the total amount of funding made available as Congress
 rushes to adjourn in October.

 In action on the IMF Thursday, Republican leaders wouldn't even allow
 Democrats to offer an amendment to insert the additional funding. Instead,
 they used procedural rules to block a vote on the issue in a $12.5 billion
 foreign operations spending bill that contained the IMF spending.

 Democrats, led by Rep. Nancy Pelosi, D-Calif., later tried to force an IMF
 funding amendment onto the House floor and managed to debate the issue
 for almost an hour. Yet again, however, Republicans used procedural
 mandates to quash the issue.

 The $14.5 billion in funding would help replenish IMF funds depleted by the
 Asian financial crisis and economic problems in Russia. The $3.5 billion is
 for a credit line known as the new arrangements to borrow.

 The IMF has come under increasing criticism in the House as world crises
 have deepened. Lawmakers have attacked everything from the IMF's loan
 procedures to budgeting process. In addition, the funding approved
 Thursday mandates numerous reforms at the agency, forcing changes in loan
 practices and in the transparency of IMF business.

 In floor debate, lawmakers on a vote of 231 to 182 removed language from
 the bill that would have eased U.S. sanctions against Azerbaijan in a bid to
 speed oil development in the Caspian Sea basin and promote Democracy in
 the former Soviet republic.

 This controversial amendment was initially added to the bill at the behest of
 the Clinton administration and was backed by House Appropriations
 Committee Chairman Bob Livingston, R-La.

 The legislation, among other things, also cuts off funding to North Korea for
 a program on the production of nuclear power. The $35 million in spending
 was slashed following North Korea's launch of a missile over Japan.

 The bill includes $745.5 million in funding for the Export-Import bank, about
 $63 million less than requested by the White House. It also includes
 reductions in funding to Israel, Egypt, former states of the Soviet Union,
 Turkey, Greece and other countries.

  -By Mark H. Anderson;202-862-9230

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