[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2605 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 2605

To require the United States to oppose the making of concessional loans 
 by international financial institutions to any entity in the People's 
                           Republic of China.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 2, 1997

 Mr. Solomon introduced the following bill; which was referred to the 
              Committee on Banking and Financial Services

_______________________________________________________________________

                                 A BILL


 
To require the United States to oppose the making of concessional loans 
 by international financial institutions to any entity in the People's 
                           Republic of China.

    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 ``Communist China Subsidy Reduction 
Act of 1997''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) the People's Republic of China has enjoyed ready access 
        to international capital through commercial loans, direct 
        investment, sales of securities, bond sales, and foreign aid;
            (2) regarding international commercial lending, the 
        People's Republic of China had $48,000,000,000 in loans 
        outstanding from private creditors in 1995;
            (3) regarding international direct investment, 
        international direct investment in the People's Republic of 
        China from 1993 through 1995 totaled $97,151,000,000, and in 
        1996 alone totaled $47,000,000,000;
            (4) regarding investment in Chinese securities, the 
        aggregate value of outstanding Chinese securities currently 
        held by Chinese nationals and foreign persons is 
        $175,000,000,000, and from 1993 through 1995 foreign persons 
        invested $10,540,000,000 in Chinese stocks;
            (5) regarding investment in Chinese bonds, entities 
        controlled by the Government of the People's Republic of China 
        have issued 75 bonds since 1988, including 36 dollar-
        denominated bond offerings valued at more than $6,700,000,000, 
        and the total value of long-term Chinese bonds outstanding as 
        of January 1, 1996, was $11,709,000,000;
            (6) regarding international assistance, the People's 
        Republic of China received almost $1,000,000,000 in foreign aid 
        grants and an additional $1,566,000,000 in technical assistance 
        grants from 1993 through 1995, and in 1995 received 
        $5,540,000,000 in bilateral assistance loans, including 
        concessional aid, export credits, and related assistance; and
            (7) regarding international financial institutions--
                    (A) despite the People's Republic of China's access 
                to international capital and world financial markets, 
                international financial institutions have annually 
                provided it with more than $4,000,000,000 in loans in 
                recent years, amounting to almost a third of the loan 
                commitments of the Asian Development Bank and 17.1 
                percent of the loan approvals by the International Bank 
                for Reconstruction and Development in 1995; and
                    (B) the People's Republic of China borrows more 
                from the International Bank for Reconstruction and 
                Development and the Asian Development Bank than any 
                other country, and loan commitments from those 
                institutions to the People's Republic of China 
                quadrupled from $1,100,000,000 in 1985 to 
                $4,300,000,000 by 1995.

SEC. 3. OPPOSITION OF UNITED STATES TO CONCESSIONAL LOANS TO THE 
              PEOPLE'S REPUBLIC OF CHINA.

    Title XV of the International Financial Institutions Act (22 U.S.C. 
262o--262o-1) is amended by adding at the end the following:

``SEC. 1503. OPPOSITION OF UNITED STATES TO CONCESSIONAL LOANS TO THE 
              PEOPLE'S REPUBLIC OF CHINA.

    ``(a) In General.--The Secretary of the Treasury shall instruct the 
United States Executive Directors at each international financial 
institution (as defined in section 1702(c)(2) of the International 
Financial Institutions Act) to use the voice and vote of the United 
States to oppose the provision by the institution of concessional loans 
to the People's Republic of China, any citizen or national of the 
People's Republic of China, or any entity established in the People's 
Republic of China.
    ``(b) Concessional Loans Defined.--As used in subsection (a), the 
term `concessional loans' means loans with highly subsidized interest 
rates, grace periods for repayment of 5 years or more, and maturities 
of 20 years or more.''.
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