Bills
| 3.23.22

Reducing the U.S. Contribution to the World Bank if Corruption Continues (H.R. 3326)

Do you support or oppose this bill?

What is H.R. 3326?

(Updated October 5, 2018)

This bill — known as the World Bank Accountability Act — would authorize the appropriation of about $3.3 billion over the 2018-2020 period for the United States’ share of the 18th replenishment of the International Development Association (IDA), which is part of the World Bank. The Secretary of the Treasury would be required to withhold up to 30 percent of that contribution unless they certify to Congress that the World Bank and IDA are adopting institutional reforms aimed at promoting accountability in its poverty reduction initiatives and fighting corruption in each of the three preceding fiscal years.

The bill would require the Secretary of the Treasury to instruct the U.S. Executive Director at the International Bank for Reconstruction and Development to use the voice and vote of the U.S. to oppose assistance to governments that have failed to implement sanctions required by U.N. Security Council resolution that’s in effect (such as the one targeting North Korea).

Argument in favor

As a world leader the U.S. has a duty to pay its share of the bill for replenishing the World Bank’s development funds. That said, America should insist on the implementation of anti-corruption reforms and reducing its contribution by up to 30% if the World Bank doesn’t follow through is wise.

Argument opposed

It’s vitally important for the U.S. to provide its share of funding for the World Bank, but conditioning up to 30% of that money on the implementation of reforms is counterproductive both to promoting accountability and the bank’s initiatives to reduce poverty throughout the developing world.

Impact

Those involved with the World Bank’s anti-poverty programs; the World Bank; Congress; and the Treasury Department.

Cost of H.R. 3326

The CBO estimates that enacting this bill would cost about $3.3 billion over the 2018-2022 period.

Additional Info

In-Depth: Sponsoring Rep. Andy Barr (R-KY) introduced this bill to ensure the World Bank enacts reforms aimed at promoting accountability for its spending:

“If the Bank is to be successful in its goal to eliminate poverty, then business as usual is not enough. The World Bank may have the best of intentions, but we must call on the Bank to deliver results, not simply look for new ways to push money out the door. In addition, the Bank is involved in a number of countries whose economic prospects are key for U.S. security interests. If the Bank cannot design and execute projects effectively, then not only could the world be less well-off, it could also be less safe.”

House Democrats have expressed opposition to provisions in the bill that would reduce the U.S. contribution to the World Bank if reforms aren’t adopted despite supporting the bill:

“We support this legislation because we support the authorization for the United States to participate in the IDA-18 replenishment. We also believe that international cooperation through U.S. leadership at the international financial institutions helps advance U.S. national security, economic interests and values. But we strongly oppose provisions in the bill that place conditions on U.S. contributions to IDA because we do not believe this is an effective approach to reform, and, more importantly, because ti could lead to a situation in which the United States would undermine IDA’s critical efforts to promote growth and reduce extreme poverty in the world.”

This legislation passed the House Financial Services Committee on a 60-0 vote and has the support of one cosponsor in the House, Rep. Brad Sherman (D-CA).


Media:

Summary by Eric Revell

(Photo Credit: ablokhin / iStock)