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[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2482 Introduced in House (IH)]

108th CONGRESS
  1st Session
                                H. R. 2482

  To call for the cancellation of loans made to Iraq by multilateral 
                        financial institutions.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             June 16, 2003

Mrs. Maloney (for herself and Mr. Leach) introduced the following bill; 
       which was referred to the Committee on Financial Services

_______________________________________________________________________

                                 A BILL

 
  To call for the cancellation of loans made to Iraq by multilateral 
                        financial institutions.

    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 ``Iraqi Freedom From Debt Act''.

SEC. 2. FINDINGS.

    The Congress finds as follows:
            (1) Debt cancellation can be an essential tool in 
        rebuilding a nation destroyed by war and humiliated by its 
        leadership. It is an effective development tool that releases 
        funds within a nation that can be used to address poverty and 
        meet essential human needs.
            (2) A significant amount of Iraq's outstanding loans were 
        taken out at the behest of Baath Party leadership and rather 
        than being used for the benefit or the well-being of the Iraqi 
        people were used for building lavish palaces, secret police, 
        prisons, and illegal weapons programs.
            (3) According to international precedent, debts incurred by 
        dictatorships for the purposes of oppressing their people or 
        for personal purpose may be considered ``odious''. In cases 
        where borrowed money is used in ways contrary to the people's 
        interest, with the knowledge of the creditors, the creditors 
        may be said to have committed a hostile act against the people. 
        Under such reasoning, such debts may be questioned.
            (4) The United States set the first precedent of odious 
        debt forgiveness in 1898 when it seized control of Cuba from 
        Spain.
            (5) Odious debt includes illegal lending. The United 
        Nations Security Council Resolution 661 expressly forbade ``the 
        sale or supply...of any commodities or products, including 
        weapons or any other military equipment''. Numerous countries 
        appear to have violated this resolution.
            (6) The IMF and the World Bank have sufficient resources to 
        cancel or adjust significantly downward all of Iraq's debts to 
        these institutions. Such an action would set a precedent to 
        follow for other creditors, odious or not, throughout the rest 
        of the world.
            (7) The World Bank group does not maintain active 
        operations in Iraq. The last time an institution in the group 
        approved a loan for Iraq was in 1973. In 1990, Iraq entered 
        into non-accrual status (failure to make loan payments) with 
        the International Bank for Reconstruction and Development 
        (World Bank). Iraq's obligations to the World Bank total 
        $82,000,000.
            (8) Iraq does not have any outstanding loans from the 
        International Monetary Fund (IMF), but Iraq does have arrears 
        of close to $72,000,000 (slightly over 52,000,000 Special 
        Drawing Rights) on its use of Special Drawing Rights.
            (9) The cancellation of all of Iraq's debts would remove a 
        major impediment to poverty reduction and economic growth in 
        Iraq, enable Iraq to invest its resources in health care, 
        education, and poverty reduction, and give Iraq a fresh start 
        in the post-war period.

SEC. 3. RELIEF OF THE ODIOUS DEBT OF IRAQ.

    (a) United States Position in the International Financial 
Institutions.--The Secretary of the Treasury shall instruct 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, vote, and influence of the United 
States to induce the respective institution to cancel or radically 
adjust downward all debts owed by Iraq to the institutions in line with 
the Paris Club negotiations.
    (b) Sense of the Congress.--The Congress urges the President to 
commence immediately, within the Paris Club of Official Creditors and 
elsewhere, efforts to urge France, Russia, and all other public and 
private creditors to cancel or radically reduce all debt owed by Iraq.

SEC. 4. REPORT TO THE CONGRESS.

    Not later than December 31 of each year, the President shall--
            (1) submit to the Committees on Financial Services, on 
        Appropriations, and on International Relations of the House of 
        Representatives and the Committees on Foreign Relations, on 
        Banking, Housing, and Urban Affairs, and on Appropriations of 
        the Senate a report on the activities undertaken under this 
        Act; and
            (2) make public a copy of the report.
                                 <all>
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