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| US Secretary of Treasury Tim Geithner © AFP Saul Loeb |
WASHINGTON (AFP) – US Treasury Secretary Timothy Geithner on Wednesday urged a skeptical Congress to boost foreign development lending, arguing a failure to stump up more cash would harm the US’s world standing.
With an eye on China’s bid to increase its power at the World Bank and other institutions, Geithner called on lawmakers to grant a 58 percent increase for the Treasury’s international programs, much of it to help fund multilateral bodies.
Facing lawmakers keen to publicly wield the proverbial budget scalpel, Geithner defended a move to increase the department’s foreign development budget to $3.4 billion as a key tool for US foreign policy.
“We must advance US interests by working through international institutions that multiply the impact of our investments,” he told a congressional hearing.
The call is part of President Barack Obama’s 2012 budget request, which must be approved by Congress before entering into force.
“With domestic resources constrained, no other institutions so effectively leverage our limited resources in service of our national and global interests,” Geithner said.
Citing the $2.5 billion that multilateral lenders are ready to provide to Egypt and Tunisia, he added that funding was essential in shaping the world in the US interest.
“Historic change is creating new openings to expand the circle of democratic societies and open economies.”
Invoking the similar calls of his Republican predecessor James Baker and former president Ronald Reagan, Geithner tried to get lawmakers — including many who are skeptical about multilateral institutions like the World Bank and regional development banks — to pony up.
“Despite a difficult environment, the Reagan administration supported a general capital increase of the World Bank and replenishment of the International Development Association in the same year.”
He insisted the lenders were “vital partners” for promoting US values, helping engage states emerging from communist rule and promoting stability from Mexico to Asia.
“Through the MDBs (multilateral development banks) we stand ready to forge a new partnership with a new generation in North Africa.”
Part of the cash would also go toward relieving the debts of low income countries, Geithner said, naming Liberia, Sierra Leone and Mozambique as beneficiaries.
© AFP — Published at Activist Post with license
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