Opening Statements of Committee Members

Prepared Testimony of Senator Chuck Hagel (R-NE)

Oversight Hearing on the International Monetary Fund (IMF)

10:30 a.m., Tuesday, March 9, 1999

Good morning and welcome to our distinguished witnesses.

I am pleased we are holding this oversight hearing on how the IMF is implementing the reforms mandated in last year's omnibus appropriations bill. I chaired a similar hearing at my Foreign Relations subcommittee back in January where Deputy Secretary Summers testified. That hearing proved to be very informative and I expect this hearing will too.

While the U.S. doesn't run the Fund, we are the single largest shareholder with 17% of the voting power. Our position at the Fund gives us great leverage in seeing that certain changes take place. Last year's reform and replenishment legislation recognized two important principles:

Many of us on the Committee worked on last year's legislation and take a particular interest in ensuring the reforms take place. The legislation set out requirements that the Fund's major shareholders support policies at the IMF which:

If we are to have an IMF, and I do believe we need an IMF, it must be effective and responsive, concentrating its efforts on how and where it can make a positive difference. But we should not expect nor ask it to do everything. Expecting the IMF to do too much will set it up for failure. The IMF cannot be all things to all peoples. That was never its charter.

In the past, Congress has become engaged in IMF programs and reforms only during periodic replenishments. One of most important elements of last year's IMF $18 billion replenishment and reform legislation, was that it established a process for regular congressional oversight. This will require us to do our own job better. The new congressional oversight process includes:

It is now Congress' responsibility to follow up and conduct vigorous oversight. This is our purpose here today. I look forward to the testimony and commend the Chairman for calling this hearing.

Thank you.

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