US Senate keeps IMF financing in war funding bill
Source: AFP
Published: May 22, 2009
Author: STAFF
The US Senate on Thursday voted to preserve 108 billion dollars in financing for the International Monetary Fund to help it deal with the global economic crisis, as part of a war funding bill.Senators rejected on a 64-30 vote an amendment proposed by Republican Senator Jim DeMint to strip the IMF funding from a supplemental 91.3 billion dollar defense bill to fund the wars in Iraq and Afghanistan
The final vote on the defense bill, which provides additional spending for the current 2009 fiscal year that ends on September 30, was expected later Thursday.
The legislation’s provisions for the IMF include 100 billion dollars for the New Arrangements to Borrow (NAB), a credit instrument providing the multilateral institution with additional resources to deal with exceptional risks to the stability of the international monetary system.
They also include an expansion of the nation’s special drawing rights by five billion SDRs, adding roughly eight billion dollars to the IMF’s financial firepower.
The 100 billion dollars for the NAB acts as a credit line for the IMF in case member countries need emergency loans that exceed the institution’s resources. As such, the money is not considered an immediate budget expense.
By contrast, senators rejected President Barack Obama’s request for 80 million dollars to close the terrorist detention camp at Guantanamo Bay, Cuba.
The Obama administration asked Congress to approve the funding after the president, at a Group of 20 summit in London last month, pledged to boost IMF funding to help countries weather the global economic crisis.
The House of Representatives last week approved the supplemental defense spending bill, but it did not include the IMF provisions.
A final congressional decision on whether the US will provide the IMF financing awaits approval by the Senate of the 2009 budget, followed by a vote in both chambers if needed on reconciled legislation.
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