[Senate Report 105-169]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 327

105th Congress                                                   Report
  2d Session                     SENATE                         105-169
_______________________________________________________________________


 
MAKING SUPPLEMENTAL APPROPRIATIONS FOR THE INTERNATIONAL MONETARY FUND 
 FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 1998, AND FOR OTHER PURPOSES

                                _______
                                

                             March 17, 1998

                                _______


   Mr. Stevens, from the Committee on Appropriations, submitted the 
                               following

                              R E P O R T

                         [To accompany S. 1769]

    The Committee on Appropriations reports the bill (S. 1769) 
making supplemental appropriations for the International 
Monetary Fund for the fiscal year ending September 30, 1998, 
and for other purposes reports favorably thereon and recommends 
that the bill do pass.

    The accompanying bill addresses the President's funding 
requests contained in budget estimate No. 1, transmitted on 
February 8, 1998 (H. Doc. 105-213). The President's request 
proposed: advance appropriations to the Department of State to 
provide arrearage payments to the United Nations [U.N.] and 
other international organizations; and appropriations for the 
International Monetary Fund [IMF].

                   MULTILATERIAL ECONOMIC ASSISTANCE

                  funds appropriated to the president

                  loans to international monetary fund

             new arrangements to borrow and quota increase

    The Committee has provided full funding for the dollar 
equivalent of the administration's request for 2,462,000,000 in 
special drawing rights for the new arrangements to borrow [NAB] 
and the dollar equivalent of 10,622,000,000 in special drawing 
rights for the U.S. share of the quota increase for the 
International Monetary Fund [IMF]. In addition, authority has 
been provided to consolidate and use funds previously 
appropriated to the general arrangements to borrow [GAB] for 
NAB purposes. The Committee understands that under the agreed 
budget procedures, the transfer of dollars will not be scored 
as a budgetary outlay because the United States receives in 
exchange another monetary asset in the form of a liquid, 
interest bearing claim on the IMF backed by its gold reserves.
    Funding for the NAB was included in the fiscal year 1998 
Foreign Operations, Export Financing and Related Programs 
appropriations bill as passed by the Senate. Committee action 
reflects the Senate's prior disposition of the administration's 
request. The combination of the GAB and NAB resources will make 
available approximately $48,000,000,000 in an emergency 
facility designed to respond to major international financial 
crises. The Committee recognizes that the NAB improves burden 
sharing by expanding the number of contributors yet protects 
substantial U.S. control over activation of the line of credit.
    The Committee acknowledges that the programs recently 
established for Thailand, Indonesia, and South Korea placed 
unexpected pressure on the IMF's liquidity and further 
recognizes these initiatives as important efforts to stabilize 
the financial and economic conditions in each of these nations. 
The Committee remains concerned that disruption and decline in 
Asian economies have consequences in United States export 
opportunities, jobs, income, and economic growth.

                united states quota, general provisions

    Sec. 101. Conditions for the use of quota resources.--The 
Committee establishes conditions which the Secretary of the 
Treasury must certify have been met prior to the transfer of 
funds to fulfill the U.S. quota subscription. The conditions 
address ongoing concerns about the systemic problems which have 
caused the financial crises prompting Fund intervention. 
Specifically, the Committee has required the Secretary certify 
that stand-by agreements and other uses of the Fund's resources 
require the borrower: (1) to guarantee nondiscriminatory 
treatment in debt resolution proceedings between domestic and 
foreign creditors and debtors, (2) to comply with international 
trade obligations; and (3) to eliminate the practice of 
directed lending or subsidies for favored enterprises and 
individuals.
    Sec. 102. Transparency and oversight.--The Committee 
establishes requirements to assure improvements in access by 
both the General Accounting Office and the public to documents 
and information on Fund operations, programs and policy 
reviews, and lending decisions. Timely public access to 
information and transparency in Fund deliberations will enhance 
market and public confidence in loans and other uses of the 
Fund's resources.
    Sec. 103. Advisory Commission.--The Committee requires the 
Secretary of the Treasury to establish an International 
Financial Institution Advisory Commission consisting of former 
Secretaries of the Treasury. The Commission is to report to 
Congress on the future role, if any, of the Fund and the 
implications of consolidation with the International Bank for 
Reconstruction and Development and the World Trade 
Organization.
    Sec. 104. Conference.--The Committee has required the 
President to convene a conference of the members of the 
International Monetary Fund, the International Bank for 
Reconstruction and Development, and the World Trade 
Organization to consider a possible merger and their current 
capacity to contribute to global financial stability and 
economic growth.
    Sec. 105. Reports.--The Committee requires regular reports 
from the Secretary of the Treasury, in consultation with the 
U.S. Executive Director at the Fund, providing information on 
borrowers' regulatory conditions, standards for capitalization, 
burden-sharing of losses between the public and private sector 
and plans to pay back loans. Given concerns that heavy debt 
burden generates additional borrowing, creating a cycle of debt 
accumulation, the Committee has required the Secretary to 
report on the plan and schedule for borrowers to assure 
elimination or restitution of all international debt 
obligations. The Committee also requires annual reporting on 
the direct and indirect recipients of Fund resources.
    Sec. 106. Certifications.--The Committee has established 
certification requirements for the semiconductor, steel, 
automobile, and textile and apparel industries. The Committee 
is concerned that Korea has engaged in unfair trade practices 
that have disadvantaged these industries.
    The Committee also finds that a healthy U.S.-based 
semiconductor industry is vital to national security interests. 
Further, the Committee finds certain foreign countries have 
directed official lending to favored export-oriented 
industries, including the semiconductor industry and that these 
practices threaten the existence of the U.S.-based industry. 
Therefore, the Committee believes U.S. policy should ensure 
that no U.S. resources should be made available directly, or 
indirectly, to promote unfair competition against the American 
semiconductor industry.

COMPLIANCE WITH PARAGRAPH 7(C), RULE XXVI OF THE STANDING RULES OF THE 
                                 SENATE

    Pursuant to paragraph 7(c) of rule XXVI, the Committee 
ordered reported the accompanying bill and S. 1768 enbloc, both 
subject to amendment and subject to scoring, by recorded vote 
of 26-2, a quorum being present.

        Yeas                          Nays
Chairman Stevens                    Mr. Faircloth
Mr. Cochran                         Mr. Kohl
Mr. Specter
Mr. Domenici
Mr. Bond
Mr. Gorton
Mr. McConnell
Mr. Burns
Mr. Shelby
Mr. Gregg
Mr. Bennett
Mr. Campbell
Mr. Craig
Mrs. Hutchison
Mr. Byrd
Mr. Inouye
Mr. Hollings
Mr. Leahy
Mr. Bumpers
Mr. Lautenberg
Mr. Harkin
Ms. Mikulski
Mr. Reid
Mrs. Murray
Mr. Dorgan
Mrs. Boxer

                            BUDGETARY IMPACT

    Section 308(a)(1)(A) of the Congressional Budget and 
Impoundment Control Act of 1974 (Public Law 93-344), as 
amended, requires that the report accompanying a bill providing 
new budget authority contain a statement detailing how that 
authority compares with the reports submitted under section 302 
of the act for the most recently agreed to concurrent 
resolution on the budget for the fiscal year.

                    Five-Year Projection of Outlays

    In compliance with section 308(a)(1)(C) of the 
Congressional Budget Act of 1974 (Public Law 93-344), as 
amended, the following table contains 5-year projections 
associated with the budget authority provided in the 
accompanying bill:

                              [In millions]

Budget authority: Fiscal year 1998............................   $17,861
Outlays:
    Fiscal year 1998....................................................
    Fiscal year 1999....................................................
    Fiscal year 2000....................................................
    Fiscal year 2001....................................................
    Fiscal year 2002 and future years...................................

Note.--Consistent with the funding recommended in the bill for the 
International Monetary Fund and in accordance with section 314(b)(3) the 
Congressional Budget Act of 1974, as amended, the Committee anticipates 
that the Budget Committee will file a revised section 302(a) allocation 
for the Committee on Appropriations reflecting an upward adjustment of 
$17,861,000,000 in budget authority.
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               Assistance to State and Local Governments

    In accordance with section 308(a)(1)(D) of the 
Congressional Budget Act of 1974 (Public Law 93-344), as 
amended, the financial assistance to State and local 
governments is as follows:

                              [In millions]

New budget authority....................................................
Fiscal year 1998 outlays................................................

                       COMPARATIVE STATEMENT OF NEW BUDGET (OBLIGATIONAL) AUTHORITY ESTIMATES AND AMOUNTS RECOMMENDED IN THE BILL                       
                                                                  [Amounts in dollars]                                                                  
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                                                                                                                                          Committee     
                                                                                                                                        recommendation  
Doc. No.                                                                                       Supplemental          Committee          compared with   
                                                                                                 request           recommendation        supplemental   
                                                                                                                                       request (+ or -) 
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                          FISCAL YEAR 1998 SUPPLEMENTAL APPROPRIATIONS                                                                                  
                                                                                                                                                        
                                       DEPARTMENT OF STATE                                                                                              
                                                                                                                                                        
                           International Organizations and Conferences                                                                                  
                                                                                                                                                        
 105-213 Arrearage payments (advance appropriation, fiscal year 1999)                          $475,000,000   ...................       -$475,000,000   
 105-213 Advance appropriation, fiscal year 2000                                                446,000,000   ...................        -446,000,000   
                                                                                        ----------------------------------------------------------------
               Total, International Organizations and Conferences                               921,000,000   ...................        -921,000,000   
                                                                                        ================================================================
                                MULTILATERAL ECONOMIC ASSISTANCE                                                                                        
                                                                                                                                                        
                               Funds Appropriated to the President                                                                                      
                                                                                                                                                        
                                   International Monetary Fund                                                                                          
                                                                                                                                                        
 105-213 United States quota, International Monetary Fund                                    14,500,000,000      $14,500,000,000   ...................  
 105-213 Loans to International Monetary Fund                                                 3,400,000,000        3,400,000,000   ...................  
                                                                                        ----------------------------------------------------------------
               Total, International Monetary Fund                                            17,900,000,000       17,900,000,000   ...................  
                                                                                        ================================================================
               Grand total, all titles (net)                                                 18,821,000,000       17,900,000,000         -921,000,000   
                   Fiscal year 1998 (net):                                                                                                              
                       New budget (obligational) authority                                  (18,821,000,000)     (17,900,000,000)       (-921,000,000)  
                       Advance appropriation, fiscal year 1999                                 (475,000,000)  ...................       (-475,000,000)  
                       Advance appropriation, fiscal year 2000                                 (446,000,000)  ...................       (-446,000,000)  
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