On March 8, the Committee welcomed 56 staffers from the U.S. House of Representatives, members, and friends for an introduction to the international financial institutions (IFIs), held on Capitol Hill.

Led by Committee Co-Chair and former U.S. Representative Bill Frenzel (R-MN), the seminar involved discussions of the World Bank Group, Multilateral Development Banks (MDBs), and International Monetary Fund (IMF). Each segment outlined the distinctive work of each institution and discussed the importance of U.S. involvement in their work.

Charles A. McDonough, Vice President and Controller of the World Bank Group, explained the distinctive role of the World Bank in middle-income nations through the International Bank for Reconstruction and Development (IBRD) and in the poorest countries through the International Development Association (IDA). He described how the World Bank Group is funded and the ways in which it manages various donor trust funds.

Next, Julie T. Katzman, Executive Vice President and COO of the Inter-American Development Bank (IDB), shared examples of IDB’s impact on small business development, girls’ education, public transportation, access to clean cook-stoves, and other areas. IDB’s programs have sparked a rapid growth in trade, an increase in employment, and, in some cases, helped to double the number of exports from the region, she said. Katzman detailed the economic and national security benefits provided to the U.S., as well, including the $8.4 billion in loan disbursements to U.S. firms and consultants for the purchase of goods and services.

Jim Kolbe, Senior Transatlantic Fellow at the German Marshall Fund of the United States and Former Congressman from Arizona’s 8th District, next offered practical advice to the staffers in the room about how to answer the question "Why spend money on foreign assistance?" He described some of the misconceptions about the international institutions he used to encounter during his years leading House Appropriations for the IFIs and emphasized the importance of understanding what the IFIs do and their positive impact on the U.S.

Mr. Kolbe asserted that there exists a clear national security interest in supporting the IFIs and emphasized the important multiplier effect that they provide for U.S. development funding. He noted that each dollar the United States invests in the World Bank supports approximately $25 of additional Bank lending. He also emphasized the power of the IFIs' work in creating access to markets, because "75% of the world’s purchasing power lies outside of the U.S."

Panelists then responded to questions from the audience, providing information about efforts underway to increase transparency, combat corruption, and promote environmental and social safeguards within the World Bank Group and the MDBs.

Finally, John Lipsky, Distinguished Visiting Scholar at Johns Hopkins University School of Advanced International Studies and Former First Deputy Managing Director of the IMF, traced the history of the Fund and its evolution on global trade and capital markets, which has increased and changed dramatically in recent decades. He explained the mechanisms and tools used by the IMF to address global financial crises, discussing lending practices, surveillance, and the importance of technical assistance. Mr. Lipsky also stressed the important leadership role of the United States in the Fund, explained the process for quota assessments, and emphasized how the recent financial crisis reminded leaders of the need for effective economic cooperation through the Fund.

As part of its ongoing efforts to demonstrate the value of U.S. leadership through the IFIs, the Committee plans to host Congressional educational events annually.

The Committee would like to thank Rep. Betty McCollum (D-MN) and her staff, program moderator and Committee Co-Chair Bill Frenzel, the Committee’s legislative task force co-leads Bill Frymoyer and Tim Adams, as well as Committee members Matt Ekberg, Joseph Engelhard, Tony Fratto, Jim Orr, and the External Relations Teams at the IMF, World Bank, IDB, and ADB for their help with this event.

Other resources distributed at the event include: