§ 262o-2. — Advocacy of policies to enhance general effectiveness of International Monetary Fund.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 22USC262o-2]
TITLE 22--FOREIGN RELATIONS AND INTERCOURSE
CHAPTER 7--INTERNATIONAL BUREAUS, CONGRESSES, ETC.
Sec. 262o-2. Advocacy of policies to enhance general
effectiveness of International Monetary Fund
(a) In general
The Secretary of the Treasury shall instruct the United States
Executive Director of the International Monetary Fund to use
aggressively the voice and vote of the Executive Director to do the
following:
(1) Vigorously promote policies to increase the effectiveness of
the International Monetary Fund in structuring programs and
assistance so as to promote policies and actions that will
contribute to exchange rate stability and avoid competitive
devaluations that will further destabilize the international
financial and trading systems.
(2) Vigorously promote policies to increase the effectiveness of
the International Monetary Fund in promoting market-oriented reform,
trade liberalization, economic growth, democratic governance, and
social stability through--
(A) establishing an independent monetary authority, with
full power to conduct monetary policy, that provides for a non-
inflationary domestic currency that is fully convertible in
foreign exchange markets;
(B) opening domestic markets to fair and open internal
competition among domestic enterprises by eliminating
inappropriate favoritism for small or large businesses,
eliminating elite monopolies, creating and effectively
implementing anti-trust and anti-monopoly laws to protect free
competition, and establishing fair and accessible legal
procedures for dispute settlement among domestic enterprises;
(C) privatizing industry in a fair and equitable manner that
provides economic opportunities to a broad spectrum of the
population, eliminating government and elite monopolies, closing
loss-making enterprises, and reducing government control over
the factors of production;
(D) economic deregulation by eliminating inefficient and
overly burdensome regulations and strengthening the legal
framework supporting private contract and intellectual property
rights;
(E) establishing or strengthening key elements of a social
safety net to cushion the effects on workers of unemployment and
dislocation; and
(F) encouraging the opening of markets for agricultural
commodities and products by requiring recipient countries to
make efforts to reduce trade barriers.
(3) Vigorously promote policies to increase the effectiveness of
the International Monetary Fund, in concert with appropriate
international authorities and other international financial
institutions (as defined in section 262r(c)(2) of this title), in
strengthening financial systems in developing countries, and
encouraging the adoption of sound banking principles and practices,
including the development of laws and regulations that will help to
ensure that domestic financial institutions meet strong standards
regarding capital reserves, regulatory oversight, and transparency.
(4) Vigorously promote policies to increase the effectiveness of
the International Monetary Fund, in concert with appropriate
international authorities and other international financial
institutions (as defined in section 262r(c)(2) of this title), in
facilitating the development and implementation of internationally
acceptable domestic bankruptcy laws and regulations in developing
countries, including the provision of technical assistance as
appropriate.
(5) Vigorously promote policies that aim at appropriate burden-
sharing by the private sector so that investors and creditors bear
more fully the consequences of their decisions, and accordingly
advocate policies which include--
(A) strengthening crisis prevention and early warning
signals through improved and more effective surveillance of the
national economic policies and financial market development of
countries (including monitoring of the structure and volume of
capital flows to identify problematic imbalances in the inflow
of short and medium term investment capital, potentially
destabilizing inflows of offshore lending and foreign
investment, or problems with the maturity profiles of capital to
provide warnings of imminent economic instability), and fuller
disclosure of such information to market participants;
(B) accelerating work on strengthening financial systems in
emerging market economies so as to reduce the risk of financial
crises;
(C) consideration of provisions in debt contracts that would
foster dialogue and consultation between a sovereign debtor and
its private creditors, and among those creditors;
(D) consideration of extending the scope of the
International Monetary Fund's policy on lending to members in
arrears and of other policies so as to foster the dialogue and
consultation referred to in subparagraph (C);
(E) intensified consideration of mechanisms to facilitate
orderly workout mechanisms for countries experiencing debt or
liquidity crises;
(F) consideration of establishing ad hoc or formal linkages
between the provision of official financing to countries
experiencing a financial crisis and the willingness of market
participants to meaningfully participate in any stabilization
effort led by the International Monetary Fund;
(G) using the International Monetary Fund to facilitate
discussions between debtors and private creditors to help ensure
that financial difficulties are resolved without inappropriate
resort to public resources; and
(H) the International Monetary Fund accompanying the
provision of funding to countries experiencing a financial
crisis resulting from imprudent borrowing with efforts to
achieve a significant contribution by the private creditors,
investors, and banks which had extended such credits.
(6) Vigorously promote policies that would make the
International Monetary Fund a more effective mechanism, in concert
with appropriate international authorities and other international
financial institutions (as defined in section 262r(c)(2) of this
title), for promoting good governance principles within recipient
countries by fostering structural reforms, including procurement
reform, that reduce opportunities for corruption and bribery, and
drug-related money laundering.
(7) Vigorously promote the design of International Monetary Fund
programs and assistance so that governments that draw on the
International Monetary Fund channel public funds away from
unproductive purposes, including large ``show case'' projects and
excessive military spending, and toward investment in human and
physical capital as well as social programs to protect the neediest
and promote social equity.
(8) Work with the International Monetary Fund to foster economic
prescriptions that are appropriate to the individual economic
circumstances of each recipient country, recognizing that
inappropriate stabilization programs may only serve to further
destabilize the economy and create unnecessary economic, social, and
political dislocation.
(9) Structure International Monetary Fund programs and
assistance so that the maintenance and improvement of core labor
standards are routinely incorporated as an integral goal in the
policy dialogue with recipient countries, so that--
(A) recipient governments commit to affording workers the
right to exercise internationally recognized core worker rights,
including the right of free association and collective
bargaining through unions of their own choosing;
(B) measures designed to facilitate labor market flexibility
are consistent with such core worker rights; and
(C) the staff of the International Monetary Fund surveys the
labor market policies and practices of recipient countries and
recommends policy initiatives that will help to ensure the
maintenance or improvement of core labor standards.
(10) Vigorously promote International Monetary Fund programs and
assistance that are structured to the maximum extent feasible to
discourage practices which may promote ethnic or social strife in a
recipient country.
(11) Vigorously promote recognition by the International
Monetary Fund that macroeconomic developments and policies can
affect and be affected by environmental conditions and policies, and
urge the International Monetary Fund to encourage member countries
to pursue macroeconomic stability while promoting environmental
protection.
(12) Facilitate greater International Monetary Fund
transparency, including by enhancing accessibility of the
International Monetary Fund and its staff, fostering a more open
release policy toward working papers, past evaluations, and other
International Monetary Fund documents, seeking to publish all
Letters of Intent to the International Monetary Fund and Policy
Framework Papers, and establishing a more open release policy
regarding Article IV consultations.
(13) Facilitate greater International Monetary Fund
accountability and enhance International Monetary Fund self-
evaluation by vigorously promoting review of the effectiveness of
the Office of Internal Audit and Inspection and the Executive
Board's external evaluation pilot program and, if necessary, the
establishment of an operations evaluation department modeled on the
experience of the International Bank for Reconstruction and
Development, guided by such key principles as usefulness,
credibility, transparency, and independence.
(14) Vigorously promote coordination with the International Bank
for Reconstruction and Development and other international financial
institutions (as defined in section 262r(c)(2) of this title) in
promoting structural reforms which facilitate the provision of
credit to small businesses, including microenterprise lending,
especially in the world's poorest, heavily indebted countries.
(b) Coordination with other executive departments
To the extent that it would assist in achieving the goals described
in subsection (a) of this section, the Secretary of the Treasury shall
pursue the goals in coordination with the Secretary of State, the
Secretary of Labor, the Secretary of Commerce, the Administrator of the
Environmental Protection Agency, the Administrator of the Agency for
International Development, and the United States Trade Representative.
(Pub. L. 95-118, title XV, Sec. 1503, as added Pub. L. 105-277, div. A,
Sec. 101(d) [title VI, Sec. 610(a)], Oct. 21, 1998, 112 Stat. 2681-150,
2681-224.)
Additional Provisions Relating to International Monetary Fund
Pub. L. 106-113, div. B, Sec. 1000(a)(5) [title V, Sec. 504], Nov.
29, 1999, 113 Stat. 1536, 1501A-317, provided that:
``(a) Publication of IMF Operational Budgets.--The Secretary of the
Treasury shall instruct the United States Executive Director at the
International Monetary Fund to use the voice, vote, and influence of the
United States to urge vigorously the International Monetary Fund to
publish the operational budgets of the International Monetary Fund, on a
quarterly basis, not later than one year after the end of the period
covered by the budget.
``(b) Report to the Congress Showing Costs of United States
Participation in the International Monetary Fund.--The Secretary of the
Treasury shall prepare and transmit to the Committees on Banking and
Financial Services [now Committee on Financial Services], on
Appropriations, and on International Relations of the House of
Representatives and the Committees on Banking, Housing, and Urban
Affairs, on Foreign Relations, and on Appropriations of the Senate a
quarterly report, which shall be made readily available to the public,
on the costs or benefits of United States participation in the
International Monetary Fund and which shall detail the costs and
benefits to the United States, as well as valuation gains or losses on
the United States reserve position in the International Monetary Fund.
``(c) Continuation of Forgoing of Reimbursement of IMF for Expenses
of Administering ESAF.--The Secretary of the Treasury shall instruct the
United States Executive Director at the International Monetary Fund to
use the voice, vote, and influence of the United States to urge
vigorously the International Monetary Fund to continue to forgo
reimbursements of the expenses incurred by the International Monetary
Fund in administering the Enhanced Structural Adjustment Facility, until
the Heavily Indebted Poor Countries Initiative (as defined in section
1623 of the International Financial Institutions Act [22 U.S.C. 262p-6])
is terminated.
``(d) No Gold Sales by International Monetary Fund Without Prior
Authorization by the Congress.--(1) [Amended section 286c of this
title.]
``(2) Not less than 30 days prior to the entrance by the United
States into international negotiations for the purpose of reaching
agreement on the disposition of Fund gold whereby resources of the Fund
would be used for the special benefit of a single member, or of a
particular segment of the membership of the Fund, the Secretary of the
Treasury shall consult with the Committees on Banking and Financial
Services [now Committee on Financial Services], on Appropriations, and
on International Relations of the House of Representatives and the
Committees on Foreign Relations, on Appropriations, and on Banking,
Housing and Urban Affairs of the Senate.
``(e) Annual Report by GAO on Consistency of IMF Practices With
Statutory Policies.--The Comptroller General of the United States shall
annually prepare and submit to the Congress of the United States a
written report on the extent to which the practices of the International
Monetary Fund are consistent with the policies of the United States, as
expressly contained in Federal law applicable to the International
Monetary Fund.''
Definitions
The definitions in section 262p-5 of this title apply to this
section.
Section Referred to in Other Sections
This section is referred to in section 262r-4 of this title.
