110TH CONGRESS 
2D SESSION 
H. R. 2634 
AN ACT 
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. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Jubilee Act for Re-
sponsible Lending and Expanded Debt Cancellation of 
2008’’. 
SEC. 2. FINDINGS. 
The Congress finds the following: 
(1) Many low-income countries have been strug-
gling under the burden of international debts for 
many years. 
(2) Since 1996, when the Heavily Indebted 
Poor Countries Initiative (HIPC) was created, more 
than 30 nations have seen some form of debt relief 
totaling approximately $80,000,000,000. 
(3) Congress has demonstrated its support for 
bilateral and multilateral debt relief through the en-
actment of comprehensive debt relief initiatives for 
heavily indebted low-income countries in— 
(A) title V of H.R. 3425 of the 106th Con-
gress, as enacted into law by section 1000(a)(5) 
of the Act entitled ‘‘An Act making consoli-
dated appropriations for the fiscal year ending 
September 30, 2000, and for other purposes’’, 
approved November 29, 1999 (Public Law 106– 
113; 113 Stat. 1501–311) and the amendments 
made by such title;
(B) title II of H.R. 5526 of the 106th 
Congress, as enacted into law by section 101(a) 
of the Act entitled ‘‘An Act making appropria-
tions for foreign operations, export financing, 
and related programs for the fiscal year ending 
September 30, 2001, and for other purposes’’, 
approved November 6, 2000 (Public Law 106– 
429; 114 Stat. 1900A–5); and 
(C) title V of the United States Leadership 
Against HIV/AIDS, Tuberculosis, and Malaria 
Act of 2003 (Public Law 108–25; 117 Stat. 
747) and the amendment made by such title. 
(4) 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 na-
tions to Paris Club members, the IMF, the World 
Bank, and the African Development Bank. The 
Inter-American Development Bank reached an 
agreement in early 2007 to provide similar treat-
ment. 
(5) The 2005 agreement led to the creation of 
the Multilateral Debt Relief Initiative (MDRI). As of 
April 2007, 22 nations have seen the majority of 
their debts to the IMF, World Bank, and African 
Development Bank cancelled under the terms of the
MDRI. In March 2007, the Inter-American Develop-
ment Bank announced it would provide full debt 
cancellation to 5 Latin American countries on MDRI 
terms. 
(6) Resources released by debt relief efforts to 
date are reaching the poor. Cameroon is using the 
$29,800,000 of savings it will gain from the MDRI 
in 2006 for national poverty reduction priorities, in-
cluding infrastructure, social sector and governance 
reforms. Uganda is using its $57,900,000 savings in 
2006 on improving energy infrastructure to try to 
ease acute electricity shortages, as well as primary 
education, malaria control, healthcare and water in-
frastructure (specifically targeting the poor and 
under-served villages). Zambia is using its savings of 
$23,800,000 under the MDRI in 2006 to increase 
spending 
on 
agricultural 
projects, 
such 
as 
smallholder irrigation and livestock disease control, 
as well as to eliminate fees for healthcare in rural 
areas. 
(7) While debt cancellation has a record of suc-
cess, there remains an unfinished agenda on inter-
national debt. There are a number of challenges to 
both the effective reduction of poverty and inequality 
and the achievement of broader debt cancellation.
(8) 2007 is an important year to address the 
unfinished agenda on international debt as the glob-
al Jubilee debt campaign has declared 2007 a ‘‘Sab-
bath year’’, 7 years after the historic Jubilee 2000 
campaign. 
(9) A critical issue which needs to be addressed 
on debt is the way that non-concessional lenders 
stand to gain financially from lending to poor coun-
tries that have benefited from debt relief without 
having paid for past debt relief or facing the pros-
pect of paying for the future relief of unsustainable 
and irresponsible new lending. In these cases, the 
gains of debt relief for poor debtor countries are at 
risk of being eroded. This takes the form of new 
lending to countries that have received debt cancella-
tion from countries including China. 
(10) It is also essential that all lenders and bor-
rowers accept co-responsibility and learn from past 
mistakes—as evidenced by the debt crisis itself—by 
making more productive investment choices and en-
gaging in more responsible lending and borrowing in 
the future. In October 2006, Norway became the 
first creditor to accept co-responsibility for past 
lending mistakes and cancelled the debt of 5 nations
on the grounds that the loans reflected poor develop-
ment policy. 
(11) A growing number of governments and 
intergovernmental bodies, including the United 
Kingdom, the European Commission, and Norway, 
are raising concerns about the harmful impacts of 
certain economic policy conditionalities. Many impov-
erished countries that have received debt cancella-
tion under the HIPC and MDRI initiatives have 
done so at a high social cost, because they have had 
to implement certain economic policy conditions, in-
cluding the privatization of essential basic services 
such as water, and comply with other harmful re-
quirements. Some of these policies have had the ef-
fect of limiting fiscal space for productive investment 
and threatening growth and human development. 
Several countries currently eligible for debt cancella-
tion under the HIPC or MDRI programs are facing 
extended delays in receiving cancellation because 
they are struggling to comply with such require-
ments from the IMF and World Bank. 
(12) There is also an urgent need to look be-
yond the constraints of current debt relief initiatives 
to address the need for expanded debt cancellation. 
The current initiatives allow countries to qualify for
relief based on economic criteria rather than human 
needs. A January 2007 report by the United Na-
tions Human Rights Council found that eligibility 
for debt cancellation should be expanded to cover all 
low-income countries. 
(13) The Government of the United Kingdom 
has proposed that qualification for the MDRI be ex-
tended to the 67 nations which qualify for assistance 
exclusively from the International Development As-
sociation. To be eligible for cancellation, countries 
must meet economic criteria pertaining to public fi-
nancial management, anti-corruption measures, and 
budget transparency. 
(14) Since debt cancellation is an essential com-
ponent of the United States development assistance 
strategy and the United States has been able to lead 
the debt cancellation efforts of the international 
community by example, the United States should 
continue to work to improve and expand initiatives 
in this area. 
(15) The United States has been a leader in 
supporting debt relief efforts to date and should con-
tinue to work to improve and expand initiatives in 
this area.
SEC. 3. CANCELLATION OF DEBT OWED BY ELIGIBLE LOW- 
INCOME COUNTRIES. 
Title XVI of the International Financial Institutions 
Act (22 U.S.C. 262p—262p–8) is amended by adding at 
the end the following: 
‘‘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 De-
velopment (World Bank), and the other international fi-
nancial institutions (as defined in section 1701(c)(2)), to 
negotiate an agreement to accomplish the following: 
‘‘(1) Cancellation by each international finan-
cial institution of all debts owed to the institution by 
eligible low-income countries, and, to the extent pos-
sible, financing the debt cancellation from the ongo-
ing operations, procedures, and accounts of the insti-
tution, without undermining the financial integrity 
of the institution. 
‘‘(2) Cancellation by the United States of all 
debts owed to it by eligible low-income countries. 
‘‘(3) Ensuring that any waiting period for the 
enhanced debt cancellation is not excessive.
‘‘(4) Ensuring that the provision of debt can-
cellation to eligible low-income countries is not fol-
lowed by a reduction in the provision of any other 
development assistance to the countries by inter-
national financial institutions and bilateral creditors, 
or to other countries eligible for assistance from the 
International Development Association. 
‘‘(5) Encouraging the government of each eligi-
ble low-income country to allocate at least 20 per-
cent of its national budget towards poverty-allevi-
ation programs such as the provision of basic health 
care services, education services, and clean water 
services to all individuals in the country. 
This subsection shall not be interpreted to authorize the 
Secretary of the Treasury to enter into an agreement to 
accomplish any of the foregoing without express congres-
sional authorization to do so. 
‘‘(b) ESTABLISHMENT OF FRAMEWORK FOR CRED-
ITOR 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 in-
stitutions (as so defined), to ensure that each of the insti-
tutions—
‘‘(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 in-
formed participation and input by affected commu-
nities, including translation of information on pro-
posed projects, provision of information (including 
draft documents) through information technology 
application, oral briefings, and outreach to and dia-
logue with community organizations and institutions 
in affected areas. 
‘‘(c) ESTABLISHMENT OF FRAMEWORK FOR RESPON-
SIBLE 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 pre-
serving the gains of debt relief for low-income debtor 
countries; 
‘‘(2) provide that the external financing needs 
of low-income countries are met primarily through 
grant financing rather than new lending; 
‘‘(3) seek the international adoption of a bind-
ing legal framework on new lending that—
‘‘(A) guarantees that no creditor can take 
or expect to take financial advantage of ac-
quired or newly awarded debt relief through the 
terms and rates of such 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 ir-
responsibly provided; 
‘‘(D) provides for decisions on irresponsible 
lending to be made by an entity independent 
from the creditors; and 
‘‘(E) enables fair opportunities for the peo-
ple of the affected country to be heard; and 
‘‘(4) support the development of responsible fi-
nancing standards where creditors and aid/loan re-
cipients alike adhere to standards to assure trans-
parency and accountability to citizens, human rights, 
and the avoidance of new odious debt, while encour-
aging the development of renewable energy and help-
ing countries to transition away from dependence on 
oil.
‘‘(d) GAO AUDIT OF DEBT PORTFOLIOS OF COUN-
TRIES WITH QUESTIONABLE LOANS.— 
‘‘(1) IN GENERAL.—The Comptroller General of 
the United States shall undertake an audit of the 
debt portfolios of previous governments in countries 
such as the Democratic Republic of Congo and 
South Africa, where there is significant evidence 
that odious, onerous, or illegal loans were made to 
the government. Each such audit shall— 
‘‘(A) consider debt owed to the World 
Bank, the IMF, and the other international fi-
nancial institutions (as so defined), export cred-
it debts owed to governments, and debts owed 
to commercial creditors, and assess whether or 
not past investments produced the intended re-
sults; 
‘‘(B) investigate the process by which the 
loans were contracted, how the funds were used, 
and determine whether United States or inter-
national laws were violated in the contraction of 
these loans, and whether any of the loans were 
odious or onerous; and 
‘‘(C) be planned and executed in a trans-
parent and consultative manner, engaging con-