Asian Development Fund

The Asian Development Bank Act (22 U.S.C. 285 et seq.) is amended by adding at the end the following:

33.

Ninth replenishment

(a)

Contribution authorized

The United States Governor of the Bank is authorized to contribute $461,000,000 on behalf of the United States to the ninth replenishment of the resources of the Fund, to the extent such amounts are made available in advance through appropriations Acts. (b)

Authorization of appropriations

In order to pay for the United States contribution under subsection (a), there are authorized to be appropriated, without fiscal year limitation, $461,000,000 for payment by the Secretary of the Treasury.

34.

Fifth capital increase

(a)

Subscription authorized

(1)The United States Governor of the Bank may subscribe on behalf of the United States to 1,104,420 additional shares of the capital stock of the Bank. (2)Any subscription by the United States to the capital stock of the Bank shall be effective only to such extent and in such amounts as are made available in advance through appropriations Acts. (b)

Limitations on authorization of appropriations

(1)In order to pay for the increase in the United States subscription to the Bank under subsection (a), there are authorized to be appropriated, without fiscal year limitation, $13,323,173,083 for payment by the Secretary of the Treasury. (2)Of the amount authorized to be appropriated under paragraph (1)— (A)$532,929,240 shall be for paid in shares of the Bank; and (B)$12,790,243,843 shall be for callable shares of the Bank.

Report on reforms

(a)

Findings

Congress makes the following findings: (1)At the Group of Twenty (G–20) Summit, which took place in Pittsburgh in September 2009, G–20 leaders agreed that additional capital resources for the multilateral development banks must be joined to key institutional reforms to ensure effectiveness. (2)The Asian Development Bank agreed to undertake institutional reforms as part of its negotiated agreement with shareholders in order to receive an increase in capital resources in the Fifth General Capital Increase (referred to in this section as the GCIV). (b)

Reporting requirement

(1)

Initial report

Not later than 180 days after the date of the enactment of this Act, the Secretary of the Treasury shall submit a report to the Committee on Foreign Relations of the Senate, the Committee on Appropriations of the Senate, the Committee on Financial Services of the House of Representatives, and the Committee on Appropriations of the House of Representatives describing the extent to which the Asian Development Bank successfully implemented— (A)the Pittsburgh G–20 reforms agreed to for future capital increases at the multilateral development banks, as referred to in the Pittsburgh Communiqué; and (B)the reforms agreed to in the context of the GCIV, as referred to in the report of the Board of Directors entitled Review of Asian Development Bank’s Resource Position and Proposal for a Fifth General Capital Increase and endorsed by Governors under Resolution No. 336, consistent with the principles reflected in the Leaders’ Statement issued at the Pittsburgh G–20 summit in September 2009. (2)

Second report

Not later than 18 months after the date of the enactment of this Act, the Secretary of the Treasury shall submit an update of the report submitted under paragraph (1) to the congressional committees set forth in paragraph (1).

Enhancing the environmental and social effectiveness of assistance programs in the Mekong River Basin

(a)

Findings

Congress makes the following findings: (1)The Mekong River Basin— (A)is home to the world’s largest inland fishery; (B)is one of the most productive regions of wet rice cultivation; (C)serves as a main and, in the near term, irreplaceable source of animal protein and caloric intake for more than 60,000,000 people; and (D)faces increased vulnerability to the impacts of global climate change, including sea-level rise, saltwater intrusion, changes in rainfall patterns and increased severity of extreme weather. (2)Hydro power development, including dams built upstream, is occurring in the Mekong River Basin without sufficient regional and national strategic development plans for water usage and food security. (3)Individual projects require more robust assessments of environmental, socioeconomic, and sociopolitical impacts, including cumulative and transboundary impacts. (4)Without appropriate study, planning, and coordination, ongoing and future hydro power activities pose serious environmental, social, and regional political consequences. (5)The consequences referred to in paragraph (4)— (A)will generate a food, livelihood, and human security gap, especially for the most vulnerable populations, which will be felt years before any benefits from increased energy production; and (B)may set back the region’s hard-won peace and stability. (b)

Coordination and consideration of environmental and social impacts

The Secretary of the Treasury shall instruct the United States Executive Director of the Asian Development Bank— (1)to advocate for the Asian Development Bank to encourage best practices in the areas of climate change adaptation, flood and drought management, hydro power impact assessments, water resource management, aquatic and terrestrial systems management, food security, and livelihood; (2)to promote the incorporation of cooperative, sustainable and equitable transboundary water management into the activities of the Asian Development Bank; (3)to encourage the Asian Development Bank to enhance its coordination with other multilateral and bilateral assistance programs in the Mekong River Basin to reduce risks to the region’s environment, economy, and food security, including through financial and policy support to the Secretariat of the 4-country Mekong River Commission (MRC), which will transition from international to regional leadership in 2011; (4)to foster Asian Development Bank and bilateral donor support to, and coordination with, the U.S. Lower Mekong Initiative (LMI), particularly in the areas of the environment and infrastructure development, which may include— (A)technology transfers to monitor water flows and water quality on a basin-wide and real-time basis; (B)participatory scenario-building, interactive workshops, and simulations involving government officials, nongovernmental organizations, and research organizations to build technical capacity; and (C)the establishment of subregional centers of excellence for education, training, and research on environmental, energy, socioeconomic, and regional cooperation related to national and transboundary water management; and (5)to support studies to assess— (A)the interaction between climate change and proposed water infrastructure projects on the Mekong River and its major tributaries, especially hydropower, water transfer, and irrigation projects; (B)the impact of such projects on the Mekong River’s critical environmental services; and (C)the viability of the Mekong Delta after upstream water development and rising sea levels.

Conflict sensitivity

(a)

Findings

Multilateral development bank activities in conflict or post-conflict countries may inadvertently— (1)fuel existing internal tensions and perceived grievances; and (2)further strain a borrowing country’s social fabric. (b)

Declaration of policy

It is the policy of the United States to advocate and support the creation and adoption of formal policies and practices— (1)that ensure conflict sensitivity in lending; (2)that enhance development effectiveness by ensuring that multilateral development banks pursue, to the maximum extent practicable, opportunities for addressing causes and consequences of the country’s conflict; and (3)that ensure that— (A)benefits from projects are transparently and appropriately distributed; (B)potential tensions are mitigated through broad consultations and appropriate redress mechanisms; (C)project implementation is sufficiently conflict-sensitive; (D)conflict-generated needs are adequately identified and addressed in projects; and (E)opportunities to strengthen reconciliation and awareness have been adequately identified. (c)

Promotion of United States policy

The Secretary of the Treasury shall instruct the United States Executive Director of each international financial institution to use the voice and vote of the United States to promote the policies and practices described in subsection (b).

Power guidelines

(a)

Declaration of policy

It is the policy of the United States to discourage multilateral development banks from providing financing for coal-fired power plants unless— (1)the multilateral development bank has provided, as necessary, financing or technical assistance to develop the institutional and technical capacity of the borrower country to examine supply and demand side alternatives to new coal-fired power plants, including the borrower’s capacity to compare alternatives based on a full-cost accounting of projects, taking into account their social, health, and environmental costs; (2)the multilateral development bank has analyzed— (A)the technical and economic feasibility of no-carbon and low-carbon alternatives; (B)the financial resources available for such alternatives; (C)the possible deployment of such resources in selecting a no-carbon or low-carbon alternative; and (D)the degree to which the project supports efforts to provide electricity access to the poor; (3)after completing the analysis described in paragraph (2), the multilateral development bank has determined that a viable alternative to the new coal-fired power plant does not exist; (4)the project uses best available technology (for the size and duty cycle of the plant) for reducing greenhouse gas emissions, except, for countries eligible for resources from the International Development Association and not eligible for loans from the International Bank for Reconstruction and Development, if the project— (A)addresses critical national security energy needs that cannot otherwise be met; (B)responds to national short-term emergencies; or (C)overcomes substantial constraints on national economic development when no viable alternatives exist; and (5)projects in countries eligible for resources from the International Development Association and loans from the International Bank for Reconstruction and Development or in countries eligible only for loans from the International Bank for Reconstruction and Development are accompanied by concrete, well-developed plans, including financing options, to the extent possible, that, in the aggregate, will offset the greenhouse gas emissions from the coal-fired power plants once the plans are fully implemented. (b)

Effect of noncompliance

If the relevant multilateral development bank considering a coal-fired power generation project in a country that is other than a country eligible for resources from the International Development Association and not eligible for loans from the International Bank for Reconstruction and Development has not met the conditions described in paragraphs (1) through (5) of subsection (a), the Secretary of the Treasury shall instruct the United States Executive Director to that multilateral development bank to vote against the extension by that institution of any loan or other financial assistance for such coal-fired power generation project. (c)

Effect of partial compliance

Notwithstanding subsection (b), if the relevant multilateral development bank described in subsection (b) has fully considered and met some, but not all, of the conditions described in paragraphs (1) through (5) of subsection (a) and the Secretary of the Treasury determines that substantial and significant steps have been taken to address the remaining unmet conditions, the Secretary of the Treasury shall instruct the United States Executive Director to that multilateral development bank to vote against or abstain from voting for the extension by that institution of any loan or other financial assistance for such coal-fired power generation project. (d)

Annual report

In each of the 4 years following the date of the enactment of this Act, the Secretary of the Treasury shall submit a report to the appropriate congressional committees that includes— (1)a description and assessment of the coal-fired power generation project approved at each multilateral development bank in the previous 2 years, the financial assistance extended by each multilateral development bank, and the level of financing and implementation of plans described in subsection (a)(5); (2)a list of the voting positions taken by the United States Executive Director for all relevant votes; (3)a determination and analysis of the degree to which each condition described in subsection (a) has been met; and (4)if the United States Executive Director voted to abstain on a loan or other financial assistance pursuant to subsection (c)— (A)a description of efforts undertaken by the multilateral development bank or borrower to meet the standards under subsection (a); and (B)an assessment of additional reasonable efforts that could have been undertaken, but did not take place. (e)

5-Year report

Not later than 5 years after the date of the enactment of this Act, the Secretary of the Treasury shall submit a report to the appropriate congressional committees that includes— (1)an analysis of the impact of the policies set forth in this section; and (2)an analysis of the continued relevance of such policies and recommended changes after taking into account the impact of the polices and other changes in multilateral development bank energy sector lending.

Energy subsidies and global climate change

(a)

Findings

Congress makes the following findings: (1)Inefficient fossil fuel subsides— (A)encourage wasteful consumption; (B)distort markets; (C)reduce the Nation’s energy security; (D)impede investment in advanced and cleaner energy sources; and (E)undermine efforts to deal with the threat of climate change. (2)According to the International Energy Agency, the costs of fossil fuel consumption subsidies are approximately $557,000,000,000 per year. (3)The poorest countries are often— (A)the most exposed to the impacts of climate change; and (B)the least able to protect their vulnerable populations and communities. (4)Multilateral development banks are in a position to work with a range of stakeholders in developing countries, including other donors— (A)to pursue low-carbon growth opportunities; and (B)to support efforts to boost climate change resiliency that also support poverty alleviation. (b)

Declaration of policy

It is the policy of the United States— (1)to promote the phasing out and rationalization of inefficient fossil fuel subsidies; (2)to encourage all nations to adopt policies that will phase out such subsidies worldwide, while striving to alleviate adverse impact on the poorest individuals; (3)to provide public financial assistance to support the deployment of sustainable clean energy in developing countries; and (4)to support efforts to increase the resiliency of developing countries, populations, and communities most vulnerable to the impacts of climate change. (c)

Promotion of United States policy