RELEASE: Rep. Hill Reiterates Opposition to Additional IMF SDR Allocation in Letter to Sec. Yellen
WASHINGTON, D.C., October 19, 2022
Rep. French Hill (AR-02) recently sent a letter to U.S. Department of Treasury Secretary Janet Yellen reiterating his opposition to a new allocation of Special Drawing Rights (SDRs) by the International Monetary Fund (IMF).
To read the full letter, click HERE.
In the letter, Rep. Hill outlines the reasons he’s opposed to an additional SDR allocation, stating, “The IMF is not an aid agency and SDRs should not be used as a tool for foreign development assistance… SDRs are not well targeted to helping countries in need because they mostly flow to wealthy nations, autocratic regimes, and state sponsors of terrorism… SDRs can be inflationary, which is counter-productive amid elevated global inflation levels.”
Rep. Hill concludes, “The Department of the Treasury should safeguard the long-term integrity of the IMF by resisting calls for mission creep at the institution. This means opposing a new SDR allocation without clear, bipartisan support in Congress for such action.”
On October 4, 2022, President Biden signed H.R. 6899, the Russia and Belarus SDR Exchange Prohibition Act of 2022, into law. The bipartisan law will prevent Russia and Belarus from exchanging its SDRs with the U.S., or any other IMF member country.
On February 28, 2022, Rep. Hill sent a letter alongside 40 other members of the House and Senate to Treasury Secretary Yellen encouraging her to get other IMF member countries to not facilitate any exchange of Russia’s SDRs.
Rep. Hill also joined UK member of Parliament Rehman Chishti in an opinion piece featured in The Times Redbox urging the IMF to review its rules on allocations of SDRs.
Last year, Rep. Hill introduced H.R. 1568, the Special Drawing Rights Oversight Act. This bill limits the executive branch’s ability to bypass Congress to authorize SDR allocations by limiting the size and frequency of allocations unless Congress authorizes them by law. Under current law, The U.S. Treasury has broad authority to unilaterally approve an SDR allocation. Rep. Hill’s bill ensures a proper check on the executive branch and greater accountability.
On February 2, 2021, Rep. Hill wrote an op-ed for the Wall Street Journal first outlining his concerns with SDRs.