LETTERS SUBMITTED FOR THE RECORD THE CHASE MANHATTAN BANK, Hon. J. WILLIAM FULBRIGHT, Washington, D.C. DEAR BILL: I would like to express my support for the bill now before the Senate Foreign Relations Committee on providing added funds to the International Development Association. I believe that much more hinges on this bill than the immediate question of whether the U.S. Government can afford to spend $480 million over the next three years for this purpose. To be sure, this is not an unimportant point, considering the state of Federal Government's finances. And yet, in the context of our expanding economy and the size of the total Federal budget, this would be a relatively small expenditure which, I believe, would have large benefits for the United States. Indeed, my principal concern relates to the symbolic importance that is attached to this bill throughout the world. We are now at the end of the sixtiesthe so-called decade of development. While some less developed countries have been able to make good economic progress, for many others it has been a decade of disillusionment. Obviously, the fault is not with our international economic policies, but mainly with the institutional bottlenecks to economic growth in these countries themselves. Foreign aid is a means of breaking down these bottlenecks, especially when it is allocated-as the IDA funds are for improving education, agriculture and physical infrastructure. I believe that the World Bank Group has learned much from the inevitable mistakes of the past and can now become an effective catalyst for economic development. While the bulk of development resources and effort must obviously come from the less developed countries themselves, IDA funds can make a significant contribution that is much larger than their monetary amount. Över the past several years, bilateral economic assistance from the advanced countries, especially the United States, to the less developed has been reduced. Unless the United States approves the proposed $480 million replenishment of IDA's resources, the 17 other member countries will not be obligated to commit further funds totalling $720 million. The result would be a reduction in that kind of multilateral assistance of most use in dealing with the strucutral problems of the less developed countries. This, coming on top of reduced bilateral aid, would considerably dishearten the development-minded leaders of the less developed region and might even jeopardize the progress that has been made so far. I feel that the advanced countries must take positive action to show that they care about the people in the rest of the world and that, with a combined effort, there is hope for overcoming their difficult problems. Replenishing the resources of the IDA is the kind of action that is urgently needed to restore this hope. Sincerely, Senator J. WILLIAM FULBRIGHT, DAVID ROCKEFELLER, COWLES COMMUNICATIONS, INC., Chairman, Senate Committee on Foreign Relations, DEAR SENATOR FULBRIGHT: Knowing your committee is considering a bill to provide for U.S. participation in the second replenishment of the International Development Association, I would like to add my voice to those who believe that our continued participation is absolutely essential to building political and economic stability in the underdeveloped countries. As a former U.S. ambassador to two African countries, I can testify to the importance of our doing everything we can to help serious, progressive governments help build viable economies. If we don't support organizations like the I.D.A. then we are asking for trouble all over the world-worse trouble than we already have in Vietnam. Sincerely Yours, WILLIAM ATTWOOD, CHAMBER OF COMMERCE OF THE UNITED STATES, Hon. J. W. Fulbright, Chairman, Senate Foreign Relations Committee, DEAR SENATOR FULBRIGHT: This letter relates to H.R. 33 to provide for increased participation by the United States in the International Developmen: Association, and for other purposes. While the National Chamber has taken no position on the particular amounts referred to in the bill, we do support IDA operations which through the multilateral participation of other free world nations promote the burden-sharing concept of development assistance. IDA operates on the basis that loan funds will not supplant private capits. and that voting rights are commensurate to subscribers' contributions. IDA also makes financial assistance available on a loan, rather than a grant, basis which can be more effectively conditioned on performance than through bilateral agres ments. We commend recent arrangements made by IDA whereby calls will be made upon the United States contribution only for amounts needed to finance procurement within the United States. This feature, coupled with IDA's provision of local currencies for development, reduces demands on dollar lending and helps improve our balance of payments position. We would appreciate your including this letter in your record of hearings to provide for continued United States participation in the International Development Association. Sincerely, Senator J. WILLIAM FULBRIGHT, DON A. GOODALL, General Manager, Legislative Action. Chairman, Senate Foreign Relations Committee, CHICAGO, ILL., March 28, 1969. The Cooperative League of the United States whose millions of member families have repeatedly shown their interest and support for multilateral assistance an integral part of the foreign aid program wholeheartedly endorses H.R. 33 which will be before your committee April 1st. Replenishment by United States of our share of funds for the International Development Association deserves prompt passage and we particularly urge that nothing be done that would entail laborious renegotiation with the score of other countries which have already provided their contribution to these funds. STANLEY DREYER, President, The Cooperative League of the USA. STATEMENT SUBMITTED BY MRS. BRUCE B. BENSON, PRESIDENT, LEAGUE OF WOMEN VOTERS OF THE UNITED STATES The League of Women Voters would like to reiterate its vigorous support for the legislation authorizing U.S. participation in the second replenishment of the soft-loan affiliate of the World Bank-the International Development Association. IDA's replenishment cannot become fully effective until the United States makes good on its pledge to provide its $480 million share ($160 million a year for three years) which represents 40 percent of the $1.2 billion total replenishment. The League of Women Voters believes that multilateral aid-of which IDA is a prime example-is a vital element of United States foreign policy. Aid contributed in this form places the responsibility for assisting the economic develop ment of the less developed countries upon all advanced countries, not only on the United States. IDA has become increasingly "international" in membership, with the combined total of developed and less developed countries growing from the initial 68 members to 102 in 1969. Furthermore, the other developed countries are assuming an increasingly large share of IDA's total financial commitment; together they contribute $3.00 for every $2.00 the United States contributes. The United States now provides only 40% of IDA funds, compared to a 43% contribution in 1960. U.S. participation in the IDA replenishment will not add to our balance of payments difficulties. IDA has worked out an acceptable accommodiation for current U.S. balance of payments difficulties (i.e., a temporary deferment of U.S. payments to IDA beyond the amounts needed to finance procurement in the United States). An abandonment of IDA's system of competitive bidding on a worldwide basis would have, in our judgment, been ill advised. Also it seems clear that congressional approval of this legislation will not add undue burden on the federal budget, since the installment payments are to be made in the form of noninterest letters of credit on which IDA may draw at a later date as its cash needs for disbursement arise. IDA's loans are urgently needed by the poorest nations-with the lowest GNP's-which cannot meet the interest and payment schedules of "hard" development loans. As loan terms from other sources have become harder and harder and debt servicing has become increasingly burdensome for the developing nations, IDA's more lenient conditions of repayment have become increasingly important. Since its establishment, at the initiative of the U.S. Congress in 1960, IDA has made an impressive record. Its credits have helped cultivate 14,000,000 acres of farmland in eleven countries, build more than 10,000 miles of roads in 23 countries, and expand secondary and vocational schools, teacher-training colleges and agricultural universities in twelve countries. Of the total $1.8 billion of credits committed during these eight years, $617 million were loaned for transportation, $501 million for industry, and $310.6 million for agriculture, forestry and fishing. IDA has served a unique function as the largest soft-lending international facility, drawing on the expertise and sound financial background of the World Bank. Immediate action by the U.S. Congress is essential since IDA's replenishment is long overdue. Because of its lack of money, IDA dropped from an annual average rate of lending of $300 million a year to barely more than $100 million last year. The remaining available funds (including the World Bank's latest $75 million transfer to IĎA) are already committed or earmarked for projects in the process of approval. Eight other developed nations have expressed their confidence in IDA by speeding up their contributions (totaling over $200 million) in advance of the U.S. contribution. But U.S. participation is essential to make the 18 nation replenishment agreement operable. We urge your committee to report this bill as approved by the House. FRIENDS COMMITTEE ON NATIONAL LEGISLATION, Senator J. W. FULBRIGHT, Washington D.C., April 22, 1969. DEAR SENATOR FULBRIGHT: The Friends Committee on National Legislation has long applauded your committee's emphasis on channeling a larger share of U.S. aid through multilateral institutions. The International Development Association is a most worthy recipient of such funds in that it provides the developing world with one of its most urgent needs-long-term, no-interest-rate loans, and we heartily support the proposed $480 million U.S. contribution to the $1.2 billion, 3-year replenishment. We stress the no-interest provision because of our great concern over the heavy debt burden being carried by the countries of Africa, Asia, and Latin America. We understand that in many countries debt service payments have been growing at a faster rate than exports. Or to speak in more human terms, very poor countries, whose people live on the edge of starvation, are incapable of helping their people help themselves at "bankers rates' any more than the American poor can educate and train themselves through loans. In a world as rich as ours, subsistence-existence is surely a human right. But that right can only be guaranteed if people have the tools to work with and the physical strength to use those tools-land, fertilizer, education, roads, sanitation, etc. IDA is one of the international counterparts of the U.S. antipoverty program in that it helps people help themselves. IDA credits are helping bring into cultiva tion more than 13 million acres of land, constructing or improving more than 10,000 miles of roads, installing electric generating capacity, improving and expanding water supply systems, and constructing and equipping 511 general secondary and specialized training schools, 30 teacher training colleges, and two agricultural universities-all in countries with a per capita GNP of less than $250 per year. A very exciting operation. We at FCNL understand some of the uneasiness expressed over the request for a $480 million commitment at this time-the size of unmet domestic needs, the smallness of the World Bank's contribution to IDA and its seeming refusal to take the risks and make the commitments that it recommends to others. Yet IDA and the people it serves should not be penalized for the shortcomings of its parent organization, nor should the overseas poor be penalized because the United States is misusing its own resources. As you have stated so well, the United States has sacrificed its domestic well-being and its international stature in Vietnam. Our Nation should not compound that mistake by reducing efforts to promote human development, either at home or abroad. A more direct solution would be to end the war, and transfer resources from human destruction to human improvement. A nation that has a per capita GNP of $4,258 per annum should be able to resolve its domestic problems and still aid countries with a per capita GNP of less than $250 per year. The disparity between the U.S. standard of living and that of much of the rest of the world makes us very uncomfortable over the buy-America proviso in the new IDA agreement. The U.S. balance of payments problem could be more easily and efficiently resolved by reducing U.S. military spending abroad. Despite this shortcoming in the IDA agreements, we of FCNL enthusiastically support the proposed $480 million U.S. contribution to the replenishment of IDA's resources over the next 3 years. We would appreciate your including this expression of support in the printed record of the hearings. Sincerely, FRANCES NEELY. |