[Senate Report 110-438]
[From the U.S. Government Publishing Office]
Calendar No. 934
110th Congress Report
SENATE
2d Session 110-438
======================================================================
JUBILEE ACT FOR RESPONSIBLE LENDING AND EXPANDED DEBT CANCELLATION OF
2008
_______
August 1, 2008.--Ordered to be printed
_______
Mr. Biden, from the Committee on Foreign Relations,
submitted the following
REPORT
[To accompany S. 2166]
The Committee on Foreign Relations, having had under
consideration the bill (S. 2166), to provide for greater
responsibility in lending and expanded cancellation of debts
owed to the United States and the international financial
institutions by low-income countries, and for other purposes,
having considered the same, reports the bill favorably with
amendments and recommends that the bill, as amended, pass.
CONTENTS
Page
I. Purpose..........................................................1
II. Committee Action.................................................1
III. Discussion.......................................................2
IV. Cost Estimate....................................................5
V. Evaluation of Regulatory Impact..................................8
VI. Changes in Existing Law..........................................8
I. Purpose
The purpose of S. 2166 is to provide for greater
responsibility in lending and expanded cancellation of debts
owed to the United States and the international financial
institutions by low-income countries.
II. Committee Action
S. 2166 was introduced by Senator Robert P. Casey, Jr., on
October 16, 2007. It is cosponsored by Senators Biden, Lugar,
Dodd, Boxer, Coleman, Feingold, Hagel, Kerry, Obama, Menendez,
Isakson, Bill Nelson, Durbin, Brown, Clinton, Collins,
Klobuchar, Leahy, Lieberman, McCaskill, Mikulski, Schumer,
Smith, Snowe, Sununu, and Wyden. A companion bill, H.R. 2634,
was introduced by Representatives Maxine Waters and Spencer
Bacchus on June 7, 2007, and approved by the House of
Representatives by a vote of 285-132 on April 16, 2008. On June
24, 2008, the committee ordered S. 2166 reported favorably by
voice vote with an amendment in the nature of a substitute.
III. Discussion
A. Overview
S. 2166, the ``Jubilee Act for Responsible Lending and
Expanded Debt Cancellation of 2008'' provides for greater
responsibility in lending and expanded cancellation of debts
owed to the United States and the international financial
institutions by low-income countries. The legislation, building
on previous rounds of bilateral and multilateral debt
cancellation, calls upon the Treasury Department to negotiate a
multilateral framework for debt cancellation with those
countries that are eligible for financing from the
International Development Association, and that meet various
other criteria. This group could eventually total as many as 24
additional poor countries that would benefit from debt
cancellation in order to promote economic, social, and human
development goals, including the United Nations Millennium
Development Goals. The legislation incorporates safeguards to
help ensure that the money freed up in these countries by debt
cancellation is used for poverty reduction purposes; moreover,
eligible countries must meet criteria regarding public
financial management quality controls, transparency, and other
good governance benchmarks. The legislation calls for the
development of a framework to promote more responsible future
lending practices and to discourage so-called ``vulture fund''
activity.
B. Rationale
Congress has demonstrated its support for bilateral and
multilateral debt relief through the enactment of comprehensive
debt relief initiatives for heavily indebted low-income
countries through various legislation enacted over the past
decade. In 2005, the United States and other G-8 nations
reached an agreement to provide cancellation of 100 percent of
the debts owed by eligible poor countries to Paris Club
members, the International Monetary Fund, the World Bank, and
the African Development Bank. The 2005 agreement led to the
creation of the Multilateral Debt Relief Initiative (MDRI). As
of April 2007, 22 countries have seen the majority of their
debts to the IMF, the World Bank and the African Development
Bank cancelled under the terms of the MDRI. In March 2007, the
Inter-American Development Bank announced it would provide full
debt cancellation to 5 Latin American countries on MDRI terms.
Reports indicate that most resources released by debt
relief efforts to date are reaching the poor. Cameroon is using
the $29,800,000 of savings gained from the MDRI for national
poverty reduction priorities, including infrastructure and
social sector and governance reforms. Uganda is using its
$57,900,000 in MDRI savings on improving energy infrastructure
to try to ease acute electricity shortages, as well as on
primary education, malaria control, health care and water
infrastructure (specifically targeting the poor and underserved
villages). Zambia is using its savings of $23,800,000 under the
MDRI to increase spending on agricultural projects, such as
small landholder irrigation and livestock disease control, as
well as to eliminate fees for health care in rural areas.
While debt cancellation has a record of success, there
remains an unfinished agenda on international debt. There are a
number of challenges to the effective implementation of
existing commitments, and broader debt cancellation is needed
if the global community is to reach key development objectives.
A critical issue which needs to be addressed on debt is the way
that nonconcessional lenders stand to gain financially from
lending to poor countries that have benefited from debt relief.
Those lenders have not contributed to past debt relief efforts
or faced the prospect of paying for the future relief of
unsustainable new lending. In these cases, the gains from debt
relief are at risk of being eroded by new, unsustainable
lending to countries that have received debt cancellation, as
well as by so-called ``vulture funds.''
It is also essential that all lenders and borrowers accept
responsibility and learn from past mistakes by making more
productive investment choices and engaging in more responsible
lending and borrowing in the future. In October 2006, Norway
became the first creditor to accept responsibility for past
lending mistakes and cancelled the debt of five countries on
the grounds that the loans reflected poor development policy.
There is also an urgent need to look beyond the constraints of
current debt relief initiatives to address the need for
expanded debt cancellation. The Government of the United
Kingdom has proposed that qualification for the MDRI be
extended to the 67 countries that qualify for assistance
exclusively from the International Development Association. To
be eligible for cancellation, countries must meet requirements
pertaining to public financial management, anticorruption
measures, and budget transparency.
The committee affirms that debt cancellation is an
important component of the United States development assistance
strategy. The United States has been a leader in supporting
debt relief efforts to date and should continue to work to
improve and expand appropriate initiatives in this area.
C. Summary of major provisions
Sense of Congress on Fully Funding Existing U.S. Arrears on
Previous Debt Relief Commitments
Section 3 recognizes that the United States has fallen
behind in funding its appropriate share of previous
multilateral commitments on debt cancellation for low-income
countries. It expresses the sense of Congress in support of a
renewed commitment to fund existing U.S. arrears related to
debt relief. This section also expresses the sense of Congress
that any additional commitments made by the United States to
fund debt cancellation for additional low-income countries
should not come at the expense of existing U.S. development
assistance to those countries; likewise, the U.S. Government
should encourage other countries to adopt a similar principle
when agreeing upon debt cancellation.
Cancellation of Debt Owed by Eligible Low-Income Countries
Section 4 calls upon the Treasury Department to commence
multilateral negotiations to achieve cancellation for eligible
countries of their respective debts held by international
financial institutions and individual countries, including the
United States. Each eligible country benefiting from debt
cancellation would be required to allocate the savings from
debt cancellation toward poverty reduction expenditures and
produce an annual report documenting how the savings were used.
The section calls upon the Secretary of the Treasury to
commence efforts to establish a framework for creditor
transparency, including greater openness surrounding the
activities of each creditor institution that makes loans to
low-income countries.
Definition of Eligible Low-Income Countries
Section 4 defines an eligible low-income nation as any
country that is eligible for financing from the International
Development Association, has transparent and effective budget
execution and public financial management systems, has
demonstrated democratic governance and transparency of
decisionmaking, does not have an excessive level of military
expenditures, has not repeatedly provided support for acts of
international terrorism, is cooperating on international
narcotics control matters, is not engaging in a consistent
pattern of gross violations of internationally recognized human
rights, and is not engaged in the proliferation of weapons of
mass destruction or related materials and components.
A Framework for Responsible Lending
Section 4 calls upon the Treasury Department to commence
efforts to establish a framework for responsible lending,
including the development of policies to ensure that all
creditors contribute to the preservation of gains of debt
relief for low-income debtor countries. This framework would
also include appropriate mechanisms to discourage so-called
``vulture fund'' activity. The section calls upon the
Government Accountability Office to undertake an audit of
multilateral loans extended to previous governments in
countries such as the Democratic Republic of Congo and South
Africa, where significant concerns existed towards those loans
at the time they were made, and complete a report on the
operations and procedures undertaken by the World Bank, the
IMF, and other international financial institutions for debt
cancellation.
Prohibition of Harmful Economic and Policy Conditions
Section 5 calls on the Treasury Department to commence
efforts within international financial institutions to ensure
that the provision of debt cancellation to eligible low-income
countries is not conditioned on any agreement by such a country
to implement or comply with policies that deepen poverty,
significantly increase the costs of public services for low-
income households, or degrade the environment. Examples of such
policies include: Implementing or extending user fees for
primary education or primary health care, and increasing the
costs of basic public services, such as education, health care,
drinking water, or sanitation, for low-income households. The
section calls on the Treasury Department to submit a report on
the degree and extent to which previous rounds of debt
cancellation for recipient countries were accompanied by such
conditions.
Cancellation of Haiti's Debts
Section 6 states the sense of Congress that, due to the
current humanitarian and political instability in Haiti,
including food shortages and political turmoil, the Secretary
of the Treasury should use his influence to expedite the
complete and immediate cancellation of Haiti's debts to all
international financial institutions, or at a minimum, urge
those institutions to immediately suspend the requirement that
Haiti make further debt service payments on that debt.
Temporary Financing to Respond to Temporary Economic Shocks
Section 7 calls on the Treasury Department to prepare a
report on the feasibility and design of a potential facility,
based at the International Monetary Fund or another
international financial institution, to provide temporary
financing to relieve debt service burdens in the case of shocks
to the economies of low-income countries beyond their control,
including natural disasters and sharp spikes in commodity
prices. The committee determined that such a report would be
appropriate in light of testimony to members at the April
hearing that such a facility could supplement debt cancellation
activities in boosting the prospects of low-income countries.
IV. Cost Estimate
In accordance with rule XXVI, paragraph 11(a) of the
Standing Rules of the Senate, the committee provides this
estimate of the costs of this legislation prepared by the
Congressional Budget Office.
United States Congress,
Congressional Budget Office,
Washington, DC, July 18, 2008.
Hon. Joseph R. Biden, Jr.,
Chairman, Committee on Foreign Relations,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 2166, the Jubilee
Act for Responsible Lending and Expanded Debt Cancellation of
2008.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Sunita
D'Monte.
Sincerely,
Peter R. Orszag.
------
Congressional Budget Office Cost Estimate
July 18, 2008.
S. 2166
Jubilee Act for Responsible Lending and Expanded Debt Cancellation of
2008
AS ORDERED REPORTED BY THE SENATE COMMITTEE ON FOREIGN RELATIONS ON
JUNE 24, 2008
Summary
S. 2166 would require the Secretary of the Treasury to
cancel all debts owed by certain low-income countries to the
United States and to work toward cancelling debt owed by those
countries to international financial institutions (IFIs).
Countries that received debt relief under this proposal would
be required to use their savings to fund programs to reduce
poverty.
CBO estimates that implementing S. 2166 would result in
discretionary outlays of $625 million over the 2009-2013
period, assuming appropriation of the estimated amounts.
(Additional amounts would be spent after 2013.) In addition,
enacting S. 2166 would increase direct spending by the amount
of the subsidy cost of loan modifications, as defined by the
Federal Credit Reform Act. CBO estimates that forgiving direct
loans and loan guarantees made to other countries would cost
$1.1 billion over the 2009-2018 period. Enacting S. 2166 would
have no effect on revenues.
S. 2166 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would not affect the budgets of state, local, or tribal
governments.
Estimated Cost to the Federal Government
The estimated budgetary impact of S. 2166 is shown in the
following table. The costs of this legislation fall within
budget function 150 (international affairs).
CHANGES IN SPENDING DUE TO S. 2166
[By fiscal year, in million of dollars]
----------------------------------------------------------------------------------------------------------------
2009 2010 2011 2012 2013 2008-2013
----------------------------------------------------------------------------------------------------------------
Changes In Spending Subject To Appropriation:
Estimated Authorization Level.............................. 0 250 250 250 250 1,000
Estimated Outlays.......................................... 0 63 125 188 250 625
----------------------------------------------------------------------------------------------------------------
Changes In Direct Spending:
Estimated Budget Authority................................. 367 367 367 0 0 1,100
Estimated Outlays.......................................... 367 367 367 0 0 1,100
----------------------------------------------------------------------------------------------------------------
Note: Components may not sum to totals because of rounding.
Basis of Estimate
For this estimate, CBO assumes that the bill will be
enacted near the start of fiscal year 2009, that the necessary
amounts will be appropriated (over a 40-year period beginning
in 2010), and that outlays will follow historical spending
patterns for similar programs.
Spending Subject to Appropriation
Section 4 would require the Secretary of the Treasury to
work with IFIs to cancel debt owed to them by certain low-
income countries and to absorb the related costs within their
existing resources. According to the Department of Treasury,
those countries owe a total of $50 billion to the World Bank,
the International Monetary Fund, the African Development Bank,
and the Asian Development Bank.
In recent negotiations regarding the Multilateral Debt
Relief Initiative (MDRI)--an effort to provide debt relief to
certain poor, heavily indebted nations--the United States was
unable to achieve its goal of funding debt relief from the
resources of the IFIs. The United States is now responsible for
20 percent of the costs of MDRI debt relief at the World Bank,
to be paid over about 40 years to match the loan repayments
that would otherwise have been made. Assuming negotiations for
the debt relief that would be authorized by S. 2166 would lead
to a similar result, CBO expects that negotiations would take
about a year, that the United States would contribute about 20
percent (or $10 billion) of the costs of debt cancellation, and
that those contributions would be made over a 40-year period.
Therefore, CBO estimates that the United States would
contribute $250 million a year or about $10 billion in total to
replenish IFIs and that implementing this provision would cost
about $625 million over the 2009-2013 period, assuming
appropriation of $1 billion over that period. The remaining $9
billion would be provided and spent after 2013.
Direct Spending
In addition to cancelling multilateral debt, section 4
would require the Secretary to cancel all debt owed to the
United States by low-income countries that meet certain
qualifications. Recent data from the Department of Treasury on
direct loans and loan guarantees made to those countries
indicate that their outstanding loans total about $2.5 billion.
Cancelling those loans would constitute loan modifications (as
defined by the Federal Credit Reform Act) and would require the
federal government to write off the net present value of the
expected stream of loan repayments, which would reflect the
current likelihood of each country repaying its loans.
CBO estimates that such countries would become eligible for
debt cancellation over the 2009-2011 period and assumes the
costs would be spread evenly across that period. Based on
information from the department, CBO further estimates that
roughly 45 percent of the outstanding loan amounts will be
repaid (with interest) under current law and that enacting the
bill would increase direct spending by about $1.1 billion over
both the 2009-2013 and 2009-2018 periods. That estimate is an
estimated subsidy cost-calculated as a net present value of
forgone principal and interest payments-for the debt
forgiveness.
Intergovernmental and Private-Sector Impact
S. 2166 contains no intergovernmental or private-sector
mandates as defined in UMRA and would not affect the budgets of
state, local, or tribal governments.
Previous CBO Estimate
On April 9, 2008, CBO transmitted a cost estimate for H.R.
2634, an identically titled act that was ordered reported by
the House Committee on Financial Services on April 3, 2008. The
House legislation would require the Secretary to begin
negotiations to cancel debt, but agreements to cancel debt
could not be finalized without further authorization from the
Congress. CBO estimated that enacting H.R. 2634, by itself,
would have no budgetary impact.
Estimate Prepared By:
Federal Costs: Sunita D'Monte
Impact on State, Local, and Tribal Governments: Neil Hood
Impact on the Private Sector: Jacob Kuipers
Estimate Approved By:
Peter H. Fontaine, Assistant Director for Budget Analysis
V. Evaluation of Regulatory Impact
Pursuant to rule XXVI, paragraph 11(b) of the Standing
Rules of the Senate, the committee has determined that there is
no regulatory impact as a result of this legislation.
VI. Changes in Existing Law
In compliance with rule XXVI, paragraph 12 of the Standing
Rules of the Senate, changes in existing law made by the bill,
as reported, are shown as follows (existing law proposed to be
omitted is enclosed in black brackets, new matter is printed in
italic, existing law in which no change is proposed is shown in
roman).
International Financial Institutions Act
* * * * * * *
SEC. 1625. IMPROVEMENT OF THE ENHANCED HIPC INITIATIVE.
* * * * * * *
SEC. 1626. CANCELLATION OF DEBT OWED BY ELIGIBLE LOW-INCOME COUNTRIES.
(a) In General.--The Secretary of the Treasury shall
commence immediate efforts, within the Paris Club of Official
Creditors, the International Monetary Fund (IMF), the
International Bank for Reconstruction and Development (World
Bank), and the other international financial institutions (as
defined in section 1701(c)(2)), to accomplish the following:
(1) Cancellation by each international financial
institution of all existing debts owed to the
institution by eligible low-income countries, and, to
the extent possible, financing the debt cancellation
from the ongoing operations, procedures, and accounts
of the institution.
(2) Cancellation by the United States of all existing
debts owed to it by eligible low-income countries.
(3) Ensuring that any waiting period for the enhanced
debt cancellation is not excessive.
(4) Requiring the government of each eligible low-
income country to--
(A) allocate the savings from debt
cancellation towards poverty-reducing
expenditures;
(B) engage interested parties, including a
broad cross-section of civil society groups, in
that allocation process;
(C) develop and implement effective policy
reforms to ensure that savings from debt
cancellation are redirected to poverty
reduction efforts and that any future borrowing
be conducted in a responsible fashion; and
(D) produce an annual report during the
period beginning when debt relief is granted
and ending 5 years after the debt relief is
completed that discloses how the savings from
debt cancellation were used, and which is made
publicly available and easily accessible to all
interested parties, including civil society
groups and the media.
(5) Encouraging the government of each eigible low-
income country to allocate at least 20 percent of its
national budget towards poverty-alleviation programs
such as the provision of basic health care services,
education services, and clean water services to all
individuals in the country.
(b) Establishment of Framework for Creditor Transparency.--
The Secretary of the Treasury shall commence immediate efforts,
within the Paris Club of Official Creditors, the International
Monetary Fund, the World Bank, and the other international
financial institutions (as so defined), to ensure that each of
the institutions--
(1) continues to make efforts to promote greater
transparency regarding the activities of the
institution, including credit, grant, guarantee, and
technical assistance operations, following a policy of
maximum disclosure; and
(2) supports continued efforts to allow informed
participation and input by affected communities,
including translation of information on proposed
projects into official languages, provision of
information (including draft documents) through
information technology application, oral briefings, and
outreach to and dialogue with community organizations
and institutions in affected areas.
(c) Establishment of Framework for Responsible Lending.--
The Secretary of the Treasury shall commence immediate efforts
to--
(1) develop and promote policies to ensure all
creditors, with no distinction, will contribute to
preserving the gains of debt relief for low-income
debtor countries;
(2) collaborate with appropriate government agencies
to discourage ``vulture fund'' activity, including by--
(A) seeking commitments from non-Paris Club
bilateral creditors not to on-sell their debt
claims on low-income countries to creditors who
do not intend to provide debt relief under the
HIPC initiative, and working with finance
ministers from other G8 countries to achieve
the same goal; and
(B) providing technical assistance to
recipient governments to advise on measures to
address ``vulture fund'' activity;
(3) provide that the external financing from official
creditors of low-income countries are met primarily
through grant financing rather than new lending;
(4) seek the international adoption of a binding
legal framework that--
(A) guarantees that no creditor can take
financial advantage of debt relief through the
terms and rates of their new lending to
beneficiary countries;
(B) is binding on all creditors, whether
multilateral, bilateral or private;
(C) foresees, as a sanction for creditors who
violate it, an equitable share in the burden of
the losses from any future debt relief needed
by the sovereign debtor to whom lending was
provided; and
(D) enables fair opportunities for the people
of the affected country to be heard; and
(5) support the development of responsible financing
standards by which creditors and aid or loan recipients
alike promote transparency, accountability, human
rights, and the avoidance of new odious unsustainable
debt, while encouraging the development of renewable
energy.
(d) GAO Audit of Debt Portfolios of Countries With
Questionable Loans.--The Comptroller General of the United
States should undertake an audit of the multilateral debt
portfolios of previous governments in countries such as the
Democratic Republic of Congo and South Africa where significant
concern exists that unsustainable loans were made to the
government. Each such audit shall--
(1) consider debt owed to the World Bank, the IMF,
and the other international financial institutions (as
so defined) and debt owed to the United States
Government and assess whether or not past investments
produced the intended results; and
(2) investigate the process by which the loans were
contracted, how the funds were used, and determine
whether United States or international laws were
violated in the contraction of these loans, and whether
any of the loans were odious or onerous.
(e) Availability on Treasury Department Website of Remarks
of United States Executive Directors at Meetings of
International Financial Institutions' Boards of Directors.--The
Secretary of the Treasury shall make available on the website
of the Department of the Treasury the full record of the
remarks of the United States Executive Director at meetings of
the boards of directors of the International Monetary Fund, the
World Bank, and the other international financial institutions
(as so defined), about cancellation or reduction of debts owed
to the institution involved, with redaction by the Secretary of
the Treasury of material deemed too sensitive for public
distribution, but showing the topic, amount of material
redacted, and reason for the redaction.
(f) Report From the Comptroller General.--Within 1 year
after the date of the enactment of this section, the
Comptroller General of the United States shall prepare and
submit to the Committees on Financial Services and on Foreign
Affairs of the House of Representatives and the Committees on
Banking, Housing, and Urban Affairs and on Foreign Relations of
the Senate a report on the ongoing operations, procedures, and
accounts of the IMF, the World Bank, and the other
international financial institutions (as so defined) for
canceling the debt of eligible low-income countries.
(g) Annual Reports From the President.--Not later than
December 31, 2008, and annually thereafter for 4 years, the
Secretary of the Treasury shall submit to the Committees on
Financial Services and on Foreign Affairs of the House of
Representatives and the Committees on Foreign Relations and on
Banking, Housing, and Urban Affairs of the Senate a report,
which shall be made available to the public, on the activities
undertaken under this section, and other progress made in
accomplishing the purposes of this section, for the prior
fiscal year. The report shall include a list of the countries
that have received debt cancellation, a list of the countries
whose request for debt cancellation has been denied and the
reasons therefor, and a list of the countries whose requests
for debt cancellation are under consideration.
(h) Eligible Low-Income Country Defined.--In this section,
the term ``eligible low-income country'' means a country--
(1) that is eligible for financing from the
International Development Association but not the World
Bank;
(2) that has transparent and effective budget
execution and public financial management systems which
ensure that the savings from debt relief are spent on
reducing poverty;
(3) that has demonstrated democratic governance and
transparency of decision-making;
(4) the government of which does not have an
excessive level of military expenditures;
(5) the government of which has not repeatedly
provided support for acts of international terrorism,
as determined by the Secretary of State under section
6(j)(1) of the Export Administration Act of 1979 (50
U.S.C. App. 2405(j)(1)), section 40 of the Arms Export
Control Act (22 U.S.C. 2780), or section 620A(a) of the
Foreign Assistance Act of 1961 (22 U.S.C. 2371(a));
(6) the government of which is cooperating on
international narcotics control matters;
(7) the government of which (including its military
or other security forces) does not engage in a
consistent pattern of gross violations of
internationally recognized human rights; and
(8) the government of which is not engaged in, and
has taken effective action to prevent entities in its
jurisdiction from engaging in, the proliferation of
weapons of mass destruction, related materials and
components, or associated delivery systems.
SEC. 1627. PROHIBITION OF HARMFUL ECONOMIC AND POLICY CONDITIONS.
(a) In General.--The Secretary of the Treasury shall
commence immediate efforts within the Paris Club of Official
Creditors, the International Monetary Fund (IMF), the
International Bank for Reconstruction and Development (World
Bank), and the other international financial institutions (as
defined in section 1701(c)(2)), to ensure that the provision of
debt cancellation to eligible low-income countries (as defined
in section 1626(h)) is not conditioned on any agreement by such
a country to implement or comply with policies that deepen
poverty, significantly increase the costs of public services
for low-income households, or degrade the environment.
(b) Report on Previous Rounds of Debt Cancellation.--Not
later than December 31, 2009, the Secretary of the Treasury
shall submit to the Committees on Financial Services and on
Foreign Affairs of the House of Representatives and the
Committees on Foreign Relations and on Banking, Housing, and
Urban Affairs of the Senate a report, which shall be made
available to the public, on the degree and extent to which
previous rounds of debt cancellation for recipient nations were
accompanied by the following conditions:
(1) Implementation or extension of user fees on 2
primary education or primary health care, including 3
prevention and treatment efforts for HIV/AIDS,
tuberculosis, malaria, and infant, child, and maternal
well-being.
(2) Increased costs for low-income households to pay
for basic public services such as education, health
care, drinking water, or sanitation.
(3) A prohibition on exempting increased government
spending on essential health care or education
expenditures from required conditions imposed by the
IMF, including national budget caps or restraints and
hiring or wage bill ceilings.