§286nn — Title 22 Foreign Relations and Intercourse | U.S. Code

Summary

Allow the Secretary of the Treasury to tell the U.S. Executive Director at the Fund to vote for a plan that helps the poorest countries get faster, deeper debt relief without putting gold on the open market or lowering the gold price. Under the plan, the Fund would sell some gold in private sales at market prices to members to create 2.226 billion Special Drawing Rights in profits. Right after each sale, the buying members would pay to cover their repurchase obligations so the Fund keeps owning the gold. The profits would go into a separate subaccount and the earnings would be used only for debt relief under the modified HIPC Initiative. Also support closing the Fund’s Special Contingency Account 2 (SCA–2) so its funds go to the poorest countries. Any U.S. share from SCA–2 would be used only for debt relief under the modified HIPC Initiative.

Title 22, §286nn

Foreign Relations and Intercourse — Source: USLM XML via OLRC

For the purpose of mobilizing the resources of the Fund in order to help reduce poverty and improve the lives of residents of poor countries and, in particular, to allow those poor countries with unsustainable debt burdens to receive deeper, broader, and faster debt relief, without allowing gold to reach the open market or otherwise adversely affecting the market price of gold, the Secretary of the Treasury is authorized to instruct the United States Executive Director of the Fund to vote—

(1)to approve an arrangement whereby the Fund—

(A)sells a quantity of its gold at prevailing market prices to a member or members in nonpublic transactions sufficient to generate 2.226 billion Special Drawing Rights in profits on such sales;

(B)immediately after, and in conjunction with each such sale, accepts payment by such member or members of such gold to satisfy existing repurchase obligations of such member or members so that the Fund retains ownership of the gold at the conclusion of such payment; and

(C)uses the earnings on the investment of the profits of such sales through a separate subaccount, only for the purpose of providing debt relief from the Fund under the modified Heavily Indebted Poor Countries (HIPC) Initiative (as defined in section 262p–6 of this title); and

(2)to support a decision that shall terminate the Special Contingency Account 2 (SCA–2) of the Fund so that the funds in the SCA–2 shall be made available to the poorest countries. Any funds attributable to the United States participation in SCA–2 shall be used only for debt relief from the Fund under the modified HIPC Initiative.

Notes & Related Subsidiaries

Editorial Notes

Amendments

2000—Par. (1)(B), (D). Pub. L. 106–429 inserted “and” at end of subpar. (B) and struck out subpar. (D) which read as follows: “shall not use more than 9⁄14 of the earnings on the investment of the profits of such sales; and”.

Statutory Notes and Related Subsidiaries

Certification to Congress Relating To Use of Profits To Augment International Monetary Fund Pub. L. 106–113, div. B, § 1000(a)(5) [title V, § 503(b)], Nov. 29, 1999, 113 Stat. 1536, 1501A–316, provided that: “Within 15 days after the United States Executive Director casts the votes necessary to carry out the instruction described in section 62 of the Bretton Woods Agreements Act [22 U.S.C. 286nn], the Secretary of the Treasury shall certify to the Congress that neither the profits nor the earnings on the investment of profits from the gold sales made pursuant to the instruction or of the funds attributable to United States participation in SCA–2 will be used to augment the resources of any reserve account of the International Monetary Fund for the purpose of making loans.”

§286nn Approval of contributions for debt reductions for the poorest countries