[Congressional Record Volume 168, Number 78 (Tuesday, May 10, 2022)]
[House]
[Pages H4754-H4755]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        RUSSIA AND BELARUS SDR EXCHANGE PROHIBITION ACT OF 2022

  Mr. GARCIA of Illinois. Madam Speaker, I move to suspend the rules 
and pass the bill (H.R. 6899) to prohibit the Secretary of the Treasury 
from engaging in transactions involving the exchange of Special Drawing 
Rights issued by the International Monetary Fund that are held by the 
Russian Federation or Belarus, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 6899

       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 ``Russia and Belarus SDR 
     Exchange Prohibition Act of 2022''.

     SEC. 2. SPECIAL DRAWING RIGHTS EXCHANGE PROHIBITION.

       (a) In General.--The Secretary of the Treasury may not 
     engage in any transaction involving the exchange of Special 
     Drawing Rights issued by the International Monetary Fund that 
     are held by the Russian Federation or Belarus.
       (b) Advocacy.--The Secretary of the Treasury shall--
       (1) vigorously advocate that the governments of the member 
     countries of the International Monetary Fund, to the extent 
     that the member countries issue freely usable currencies, 
     prohibit transactions involving the exchange of Special 
     Drawing Rights held by the Russian Federation or Belarus and
       (2) direct the United States Executive Director at each 
     international financial institution (as defined in section 
     1701(c)(2) of the International Financial Institutions Act) 
     to use the voice and vote of the United States to oppose the 
     provision of financial assistance to the Russian Federation 
     and Belarus, except to address basic human needs of the 
     civilian population.
       (c) Termination.--The preceding provisions of this section 
     shall have no force or effect on the earlier of--
       (1) the date that is 5 years after the date of the 
     enactment of this Act; or
       (2) 30 days after the date that the President reports to 
     the Congress that the governments of the Russian Federation 
     and Belarus have ceased destabilizing activities with respect 
     to the sovereignty and territorial integrity of Ukraine.
       (d) Waiver.--The President may waive the application of 
     this section if the President reports to the Congress that 
     the waiver is in the national interest of the United States 
     and includes an explanation of the reasons therefor.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Illinois (Mr. Garcia) and the gentleman from Arkansas (Mr. Hill) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Illinois.


                             General Leave

  Mr. GARCIA of Illinois. Madam Speaker, I ask unanimous consent that 
all Members may have 5 legislative days in which to revise and extend 
their remarks on this legislation and to insert extraneous material 
thereon.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Illinois?
  There was no objection.
  Mr. GARCIA of Illinois. Madam Speaker, I yield myself such time as I 
may consume.
  Madam Speaker, I commend the gentleman from Arkansas (Mr. Hill) for 
his leadership on H.R. 6899, the Russia and Belarus SDR Exchange 
Prohibition Act of 2022.
  Mr. Hill's legislation would codify the Biden administration's 
current position against exchanging any Special Drawing Rights, or 
SDRs, held by Russia or Belarus for U.S. dollars.
  SDRs are a special reserve asset created by the International 
Monetary Fund to supplement the official reserves of its members. SDR 
allocations are distributed to all IMF member countries in proportion 
to their shareholding in the fund, and countries can hold their SDRs as 
part of their precautionary reserve balances or convert them for hard 
currency to finance balance of payments needs, pay for imports, adjust 
the composition of their reserves, or pay back IMF loans.
  In August of 2021, the IMF issued a $650 billion general allocation 
of SDRs, of which $275 billion went to emerging market and developing 
countries to help transform the global pandemic crisis into a fair and 
resilient economic recovery.
  Given the recent sanctions placed by the G7 group of nations against 
Russia's central bank and other Russian financial institutions, as well 
as the international sanctions against the banking sector in Belarus, 
it would be difficult for Russia or Belarus to find any country willing 
to convert their SDRs, especially since such a transaction would be 
viewed by the rest of the world as a hostile action.
  Even if the central bank of Russia were able to acquire a key freely 
usable currency, such as U.S. dollars, euros, yen, or pounds, as a 
result of an SDR transaction, current sanctions would effectively 
immobilize those assets.
  I think it is useful for Congress to reinforce the administration's 
position against the conversion of SDRs held by Russia or Belarus, and 
I urge my colleagues to support this bill.
  Madam Speaker, I reserve the balance of my time.
  Mr. HILL. Madam Speaker, I yield myself such time as I may consume.
  Madam Speaker, I rise today in support of my legislation being 
considered here on the House floor, the Russia and Belarus SDR Exchange 
Prohibition Act, H.R. 6899.
  This legislation would prohibit the United States from exchanging any 
Special Drawing Rights, or SDRs, with Russia or Belarus. These SDRs are 
reserve assets issued by the International Monetary Fund, the IMF.
  This bill would also require the Secretary of the Treasury to work 
with other IMF member countries to prevent them from doing the same.
  Now, let's be blunt. We should be especially concerned by Russia's 
ability to exchange its SDRs for Chinese renminbi or pledge their SDRs 
for a loan that isn't transparent to the world in support of Russia's 
illegal invasion by a country such as China, using those reserve 
assets.

[[Page H4755]]

  


                              {time}  1700

  This is a particular risk, as Moscow is increasingly forced to 
potentially turn to China in response to global sanctions imposed on 
the nation of Russia and its central bank. Mr. Speaker, the world is 
watching, and we must send a message that the United States is not 
standing idly by and allowing SDR assets to be used to finance the 
destruction of Ukraine.
  Russia alone owns over $25 billion of these IMF reserve assets, and 
these IMF assets represent unconditional liquidity and a source of 
financing for the Kremlin. It is important to note that of that $25 
billion of SDR assets on the books of the Russian central bank, more 
than $17 billion of it was just recently gifted to czar Putin last 
year, through the Biden administration's $650 billion green-lighting of 
a general SDR allocation by the IMF.
  Nearly a billion dollars in SDRs were also awarded to Belarus last 
year, a move that our colleagues from the bipartisan Friends of Belarus 
Caucus warned would be rewarding state-sponsored violence against 
civilians.
  Now, Mr. Speaker, on this House floor, in our committee, and in many 
other forums over many months, I urged Treasury Secretary Yellen and 
the administration not to pursue this flawed policy. There were 
superior policy choices with an eye to benefiting the poorest nations 
on our globe that have had the hardest macroeconomic impact as a result 
of COVID-19, superior policy choices, far superior to an across-the-
board general allocation, because not only do wealthy countries get 
that allocation and the poor countries get it, but the foes of freedom 
get the allocation. We are back on this House floor today talking about 
the ramifications of when that happens. Two foes of freedom today, no 
doubt, are Belarus and Russia.
  My warnings came long before the invasion of Ukraine began, but those 
warnings were not heeded. Today, we come to the House floor united as a 
bipartisan leadership team saying under no circumstances should the 
central banks of Belarus and Russia in any way, shape, or form have 
access to their special drawing rights, pledge their special drawing 
rights, or exchange their special drawing rights, and we once again 
urge our Treasury Secretary to put up the guardrails, lay those rules 
of the road out, prohibit anyone who is a member of the IMF from doing 
likewise. That work with our allies at the IMF is critical to ensure 
that China or some other nation doesn't throw Vladimir Putin an SDR 
lifeline.
  Passing this bill, too, sends a clear signal to Beijing that the 
United States will not tolerate such a move, and I would argue our 
European Transatlantic partners would not tolerate such a move.
  This bill also requires the administration to oppose conventional 
loans to Russia or Belarus if they approach the IMF as a lender of last 
resort. This is important, because as we seek to exert maximum pressure 
against these regimes, we cannot, as Mr. Sherman talked about a few 
minutes ago, allow loopholes to be exploited for potential assistance 
from the IMF.
  H.R. 6899 presents a clear choice to Russia and Belarus: End the 
destabilizing activities in Ukraine or find yourself shut off from 
emergency liquidity just like on this floor we have talked about 
shutting off diplomatic efforts at global responsibility.
  I conclude my comments by thanking Chair Waters and her Democratic 
colleagues for their support of this bill and her work on this bill and 
her recognition of what a tragedy a backdoor bailout of Russia by 
others using central bank assets would be.
  We will continue to find a way to deprive Russia of cash and 
financing as it continues to wage war in Ukraine. H.R. 6899 is a strong 
step in that direction. I urge my colleagues to support the bill, and I 
reserve the balance of my time.
  Mr. GARCIA of Illinois. Mr. Speaker, we have no further speakers, and 
I reserve the balance of my time.
  Mr. HILL. Mr. Speaker, I yield myself the balance of my time to 
close.
  As Russia continues to wage war on Ukraine, this body, on a 
bipartisan basis, will continue to ensure that we are using all the 
levers to exert and utilize maximum pressure, maximum lethal assistance 
pressure to Ukraine, maximum diplomatic pressure through isolating 
Russia in international organizations, and maximum economic pressure 
that we are talking about on this floor, of which H.R. 6899 is one cog 
in that wheel.
  Mr. Speaker, I also want to thank U.S. Senators Rick Scott and Joe 
Manchin, who have introduced the companion legislation to H.R. 6899 in 
the U.S. Senate.
  I look forward to this becoming law soon. I urge all my colleagues to 
support the Russia and Belarus SDR Exchange Prohibition Act, and I 
yield back the balance of my time.
  Mr. GARCIA of Illinois. Mr. Speaker, I yield myself the balance of my 
time.
  In closing, I thank the bill's author, Representative Hill, for 
giving the Members of the House the opportunity to act together against 
Russia and Belarus and their war against the free world. I urge Members 
on both sides of the aisle to join me in supporting H.R. 6899.
  Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Trone). The question is on the motion 
offered by the gentleman from Illinois (Mr. Garcia) that the House 
suspend the rules and pass the bill, H.R. 6899, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mrs. MILLER of Illinois. Mr. Speaker, on that I demand the yeas and 
nays.
  The SPEAKER pro tempore. Pursuant to section 3(s) of House Resolution 
8, the yeas and nays are ordered.
  Pursuant to clause 8 of rule XX, further proceedings on this motion 
are postponed.

                          ____________________