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crease in its external surplus with the United States and
the countries of the Asia-Pacific region.
SEMIANNUAL
REPORTS
ON
FINANCIAL
STABILIZATION
PROGRAMS LED BY THE INTERNATIONAL MONETARY
FUND IN CONNECTION WITH FINANCING FROM THE
EXCHANGE STABILIZATION FUND
SEC. 609. Title XVII of the International Financial
Institutions Act (22 U.S.C. 262r–262r-2) is amended by
adding at the end the following:
‘‘SEC. 1704. REPORTS ON FINANCIAL STABILIZATION PRO-
GRAMS LED BY THE INTERNATIONAL MONE-
TARY FUND IN CONNECTION WITH FINANC-
ING FROM THE EXCHANGE STABILIZATION
FUND.
‘‘(a) IN GENERAL.—The Secretary of the Treasury,
in consultation with the Secretary of Commerce and other
appropriate Federal agencies, shall prepare reports on the
implementation of financial stabilization programs (and
any material terms and conditions thereof) led by the
International Monetary Fund in countries in connection
with which the United States has made a commitment to
provide, or has provided financing from the stabilization
fund established under section 5302 of title 31, United
States Code. The reports shall include the following:
‘‘(1) A description of the condition of the econo-
mies of countries requiring the financial stabilization
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programs, including the monetary, fiscal, and ex-
change rate policies of the countries.
‘‘(2) A description of the degree to which the
countries requiring the financial stabilization pro-
grams have fully implemented financial sector re-
structuring and reform measures required by the
International Monetary Fund, including—
‘‘(A) ensuring full respect for the commer-
cial orientation of commercial bank lending;
‘‘(B) ensuring that governments will not
intervene in bank management and lending de-
cisions (except in regard to prudential super-
vision);
‘‘(C) the enactment and implementation of
appropriate financial reform legislation;
‘‘(D) strengthening the domestic financial
system and improving transparency and super-
vision; and
‘‘(E) the opening of domestic capital mar-
kets.
‘‘(3) A description of the degree to which the
countries requiring the financial stabilization pro-
grams have fully implemented reforms required by
the International Monetary Fund that are directed
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at corporate governance and corporate structure, in-
cluding—
‘‘(A) making nontransparent conglomerate
practices more transparent through the applica-
tion of internationally accepted accounting
practices, independent external audits, full dis-
closure, and provision of consolidated state-
ments; and
‘‘(B) ensuring that no government sub-
sidized support or tax privileges will be provided
to bail out individual corporations, particularly
in the semiconductor, steel, and paper indus-
tries.
‘‘(4) A description of the implementation of re-
form measures required by the International Mone-
tary Fund to deregulate and privatize economic ac-
tivity by ending domestic monopolies, undertaking
trade liberalization, and opening up restricted areas
of the economy to foreign investment and competi-
tion.
‘‘(5) A detailed description of the trade policies
of the countries, including any unfair trade practices
or adverse effects of the trade policies on the United
States.
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‘‘(6) A description of the extent to which the fi-
nancial stabilization programs have resulted in ap-
propriate burden-sharing among private sector credi-
tors, including rescheduling of outstanding loans by
lengthening maturities, agreements on debt reduc-
tion, and the extension of new credit.
‘‘(7) A description of the extent to which the
economic adjustment policies of the International
Monetary Fund and the policies of the government
of the country adequately balance the need for finan-
cial stabilization, economic growth, environmental
protection, social stability, and equity for all ele-
ments of the society.
‘‘(8) Whether International Monetary Fund in-
volvement in labor market flexibility measures has
had a negative effect on core worker rights, particu-
larly the rights of free association and collective bar-
gaining.
‘‘(9) A description of any pattern of abuses of
core worker rights in recipient countries.
‘‘(10) The amount, rate of interest, and dis-
bursement and repayment schedules of any funds
disbursed from the stabilization fund established
under section 5302 of title 31, United States Code,
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in the form of loans, credits, guarantees, or swaps,
in support of the financial stabilization programs.
‘‘(11) The amount, rate of interest, and dis-
bursement and repayment schedules of any funds
disbursed by the International Monetary Fund to
the countries in support of the financial stabilization
programs.
‘‘(b) TIMING.—Not later than October 1, 1998, and
semiannually thereafter, the Secretary of the Treasury
shall submit to the Committees on Banking and Financial
Services and International Relations of the House of Rep-
resentatives and the Committees on Foreign Relations,
and Banking, Housing, and Urban Affairs of the Senate
a report on the matters described in subsection (a).’’.
REPORTS ON REFORMING THE ARCHITECTURE OF THE
INTERNATIONAL FINANCIAL SYSTEM
SEC. 610. (a) FINDINGS.—The Congress finds that,
in order to ensure that the International Monetary Fund
does not become the global lender of last resort to private
sector corporations and financial institutions, and in order
to help prevent future threats to the international finan-
cial system, the Secretary of the Treasury and the Chair-
man of the Board of Governors of the Federal Reserve
System, working with their counterparts in other countries
and with international organizations as appropriate,
should—
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(1) seek to establish a broad set of international
transparency principles on accounting and disclosure
policies and practices covering, in particular, private
sector financial organizations;
(2) promote improvements in the provision by
both borrowers and lenders of timely and com-
prehensive aggregate information on cross-border fi-
nancial stocks and flows;
(3) seek an international accord establishing
uniform minimum standards with respect to robust
banking and supervisory systems, which individual
countries should be required to meet as a condition
for the establishment of subsidiaries, branches, or
other offices of banking institutions from their coun-
tries in the jurisdictions of the countries participat-
ing in the accord;
(4) immediately initiate with appropriate rep-
resentatives of the countries that are members of the
International Monetary Fund discussions aimed at
securing national treatment for United States inves-
tors in such countries; and
(5) seek to establish internationally acceptable
bankruptcy standards and should work particularly
to have International Monetary Fund recipient coun-
tries adopt such standards.
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(b) REPORTS.—
(1) IN GENERAL.—The Secretary of the Treas-
ury shall prepare 3 reports on progress made toward
achieving the objectives outlined in subsection (a),
which shall describe the steps taken by the United
States, other members of the world community, and
the international financial institutions to strengthen
safeguards in the global financial system, including
measures to promote more efficient functioning of
global markets, by—
(A) helping to develop effective legal and
regulatory frameworks, including appropriate
bankruptcy and foreclosure mechanisms;
(B) increasing transparency and disclosure
by both the private and public sectors;
(C) strengthening prudential standards,
both globally and in individual economies;
(D) improving domestic policy manage-
ment;
(E) strengthening the role of the inter-
national financial institutions in financial crisis
prevention and management; and
(F) ensuring appropriate burden-sharing
by the private sector, particularly commercial
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banks and financial institutions, in the resolu-
tion of crises.
(2) TIMING.—The Secretary of the Treasury
shall submit to the Committees on Banking and Fi-
nancial Services and International Relations of the
House of Representatives and the Committees on
Foreign Relations and Banking, Housing, and
Urban Affairs of the Senate 2 interim reports on the
matters described in paragraph (1), the first of
which is due by October 1, 1998, and the second of
which is due on April 1, 1999, and a final report on
such matters, which is due on October 1, 1999.
ANNUAL
REPORT
AND
TESTIMONY
ON
THE
STATE
OF
THE INTERNATIONAL FINANCIAL SYSTEM, IMF RE-
FORM, AND COMPLIANCE WITH IMF AGREEMENTS
SEC. 611. Title XVII of the International Financial
Institutions Act (22 U.S.C. 262r–262r-2) is further
amended by adding at the end the following:
‘‘SEC. 1705. ANNUAL REPORT AND TESTIMONY ON THE
STATE OF THE INTERNATIONAL FINANCIAL
SYSTEM, IMF REFORM, AND COMPLIANCE
WITH IMF AGREEMENTS.
‘‘(a) REPORTS.—Not later than October 1 of each
year, the Secretary of the Treasury shall submit to the
Committee on Banking and Financial Services of the
House of Representatives and the Committee on Foreign
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Relations of the Senate a written report on the progress
(if any) made by the United States Executive Director at
the International Monetary Fund in influencing the Inter-
national Monetary Fund to adopt the policies and reform
its internal procedures in the manner described in section
1503.
‘‘(b) TESTIMONY.—After submitting the report re-
quired by subsection (a) but not later than October 31
of each year, the Secretary of the Treasury shall appear
before the Committee on Banking and Financial Services
of the House of Representatives and the Committee on
Foreign Relations of the Senate and present testimony
on—
‘‘(1) any progress made in reforming the Inter-
national Monetary Fund;
‘‘(2) the status of efforts to reform the inter-
national financial system; and
‘‘(3) the compliance of countries which have re-
ceived assistance from the International Monetary
Fund with agreements made as a condition of receiv-
ing the assistance.’’.
AUDITS OF THE INTERNATIONAL MONETARY FUND
SEC. 612. Title XVII of the International Financial
Institutions Act (22 U.S.C. 262r–262r-2) is further
amended by adding at the end the following:
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‘‘SEC. 1706. AUDITS OF THE INTERNATIONAL MONETARY
FUND.
‘‘(a) ACCESS TO MATERIALS.—Not later than 30
days after the date of the enactment of this section, the
Secretary of the Treasury shall certify to the Committee
on Banking and Financial Services of the House of Rep-
resentatives and the Committee on Foreign Relations of
the Senate that the Secretary has instructed the United
States Executive Director at the International Monetary
Fund to facilitate timely access by the General Accounting
Office to information and documents of the International
Monetary Fund needed by the Office to perform financial
reviews of the International Monetary Fund that will fa-
cilitate the conduct of United States policy with respect
to the Fund.
‘‘(b) REPORTS.—Not later than June 30, 1999, and
annually thereafter, the Comptroller General of the United
States shall prepare and submit to the committees speci-
fied in subsection (a) a report on the financial operations
of the Fund during the preceding year, which shall in-
clude—
‘‘(1) the current financial condition of the
International Monetary Fund;
‘‘(2) the amount, rate of interest, disbursement
schedule, and repayment schedule for any loans that
were initiated or outstanding during the preceding
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calendar year, and with respect to disbursement
schedules, the report shall identify and discuss in de-
tail any conditions required to be fulfilled by a bor-
rower country before a disbursement is made;
‘‘(3) a detailed description of whether the trade
policies of borrower countries permit free and open
trade by the United States and other foreign coun-
tries in the borrower countries;
‘‘(4) a detailed description of the export policies
of borrower countries and whether the policies may
result in increased export of their products, goods,
or services to the United States which may have sig-
nificant adverse effects on, or result in unfair trade
practices against or affecting United States compa-
nies, farmers, or communities;
‘‘(5) a detailed description of any conditions of
International Monetary Fund loans which have not
been met by borrower countries, including a discus-
sion of the reasons why such conditions were not
met, and the actions taken by the International
Monetary Fund due to the borrower country’s non-
compliance;
‘‘(6) an identification of any borrower country
and loan on which any loan terms or conditions were
renegotiated in the preceding calendar year, includ-
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ing a discussion of the reasons for the renegotiation
and any new loan terms and conditions; and
‘‘(7) a specification of the total number of loans
made by the International Monetary Fund from its
inception through the end of the period covered by
the report, the number and percentage (by number)
of such loans that are in default or arrears, and the
identity of the countries in default or arrears, and
the number of such loans that are outstanding as of
the end of period covered by the report and the ag-
gregate amount of the outstanding loans and the av-
erage yield (weighted by loan principal) of the his-
torical and outstanding loan portfolios of the Inter-
national Monetary Fund.’’.
SHORT TITLE
SEC. 613. Sections 605 through 613 of this title may
be cited as the ‘‘International Monetary Fund Reform and
Authorization Act of 1998’’.
Titles I through V, the appropriations paragraphs of
title VI, and sections 601 through 604, of this Act may
be cited as the ‘‘Foreign Operations, Export Financing,
and Related Programs Appropriations Act, 1999’’.