WASHINGTON – Sen. Chuck Grassley (R-Iowa)
joined Sen. Bill Hagerty (R-Tenn.), Rep. French Hill (AR-02) and 38 additional
members of the House and Senate in
urging
U.S. Treasury Secretary Janet Yellen to ensure International Monetary Fund
(IMF) member countries are not facilitating any exchange of Russia’s
Special Drawing Rights (SDRs). According to the
IMF,
member countries are able to exchange SDRs for hard currency – meaning Russia
could use this loophole to bolster foreign currency reserves as the Ruble
plummets.
“We cannot allow these reserve assets to
help the regime withstand the latest sanctions announced by the President, let
alone offer additional billions through further allocations. Moreover, the U.S.
needs to work with allies on the IMF Board to plan for contingencies if Russia
is forced to approach the Fund for lending. The IMF should not rescue a regime
that poses such a threat to global economic stability,” the lawmakers wrote.
Since the U.S. is the largest shareholder
of the IMF, Grassley and his colleagues conclude their letter by imploring
Yellen to ensure the IMF is not used to support Putin’s unprovoked attack on
Ukraine.
Read the full letter below or by clicking
HERE.
We write today to urge the Biden Administration to advocate, on behalf
of the United States, at the International Monetary Fund that all member
countries formally agree to not facilitate any exchange of Russia’s Special
Drawing Rights (SDRs) and oppose any additional SDR allocation that bolsters
Russian reserves.
The hostile invasion of Ukraine this week demonstrates why the IMF
should have never approved its latest $650 billion general allocation of SDRs
in August 2021. As Republicans have repeatedly raised, general SDR allocations
are not targeted and have no conditions on what the SDRs can be used for.
The Biden Administration’s support for the IMF’s $650 billion general
allocation, of which more than $17 billion went to Russia, ran counter to U.S.
sanctions against Moscow even before the invasion of Ukraine. We cannot allow
these reserve assets to help the regime withstand the latest sanctions
announced by the President, let alone offer additional billions through further
allocations. Moreover, the U.S. needs to work with allies on the IMF Board to
plan for contingencies if Russia is forced to approach the Fund for lending.
The IMF should not rescue a regime that poses such a threat to global economic
stability.
As the largest shareholder of the IMF, the United States has a
responsibility to ensure that the Fund is not misused to support Russia’s warmongering in Ukraine.
We urge you to take all necessary measures to prevent this.
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