[Excerpt: Critics of the group say poor countries are unable to escape
crushing debt burdens and are unable to invest in education, health and
other programmes to curb poverty...Selling IMF gold reserves to finance
debt relief is strongly favoured by Britain, the G7's current chairman,
but the United States has previously expressed reservations about the
approach...Saxton said the US Congress "has an obligation to protect the
taxpayers and reject any proposed IMF gold sales".]

http://english.aljazeera.net/NR/exeres/D11A3DEF-0AED-470A-A28F-CC52C141290A.htm

US to block IMF gold sale

Wednesday 06 April 2005, 3:19 Makka Time, 0:19 GMT  

IMF gold reserves are worth $45 billion at current prices

The movement to sell a portion of IMF gold reserves to finance debt
relief for poor nations has hit a roadblock after a key US lawmaker said
Congress and the Bush administration will block any such move.

Jim Saxton, chairman of the Joint Economic Committee of Congress, said
on Tuesday the potential profits on IMF gold sales "rightfully belong to
the original donor countries and their taxpayers".
  
"Thus, these IMF gold sales would amount to a hidden appropriation from
the donor countries that were the original source of the gold."
  
Saxton, who said he supported other means for debt relief, said
congressional approval would be required for any IMF gold sale.
  
The movement to sell some part of IMF gold reserves, long backed by
activists for debt relief, has gathered momentum recently. 
  
Debt relief

In London in February, finance ministers of the Group of Seven
industrialised nations asked the IMF to draft a proposal on gold sales
for debt relief to be presented at the spring meetings of the Fund and
the World Bank in mid-April in Washington. 

Global finance officials have been searching for a way to cut the
estimated $80 billion owed by the poorest nations to multilateral
institutions such as the IMF and World Bank.

Critics of the group say poor countries are unable to escape crushing
debt burdens and are unable to invest in education, health and other
programmes to curb poverty.

Selling IMF gold reserves to finance debt relief is strongly favoured by
Britain, the G7's current chairman, but the United States has previously
expressed reservations about the approach.
  
Saxton said the US Congress "has an obligation to protect the taxpayers
and reject any proposed IMF gold sales". 
  
Gold reserves

He added that the Bush administration "has taken the right position in
opposing the IMF on this matter, and deserves congressional support.
There are better ways of financing debt relief than drilling the
taxpayers yet again". 

The statement from Saxton added that for nearly its entire history, the
IMF "failed to have lending safeguards and accounting controls in place.
Not surprisingly, some of its loans have gone bad, and the consequences
should not be papered over".

An IMF spokesman declined to comment on Saxton's remarks.
  
But IMF managing director Rodrigo Rato said last month that some of the
IMF's undervalued gold could be sold on the open market as part of a
debt relief plan.
  
IMF figures show the international organisation has 103.4 million ounces
of gold.

The IMF values the gold at a low level of $9 billion, for historical
reasons. At current market prices the gold would be worth $45 billion.
AFP
enditem


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