Russia Could Get $4 Billion in IMF Aid, Brady Testifies

WASHINGTON — Russia may qualify for roughly $4 billion in assistance from the International Monetary Fund in the initial months or years after it joins the organization, Treasury Secretary Nicholas F. Brady told a congressional panel Wednesday.

Brady cited the figure--the first such public estimate by a U.S. official--in testimony before the foreign operations subcommittee of the House Appropriations Committee as he pressed Congress to approve a $12-billion increase in the American share of the IMF’s capital resources.

The IMF could vote to grant membership to Russia and several other former Soviet republics as early as next month at its spring meeting in Washington. On Wednesday, Uzbekistan and Tajikistan applied for membership, leaving Georgia the only one of the 15 former Soviet republics that has not yet sought membership.

The IMF, and its sister organization, the World Bank, are the primary means through which the West plans to provide aid to help the new nations transform their economies. Generally, the IMF gives aid only after recipients agree to undertake drastic, often painful economic reforms. But, once offered, IMF assistance becomes a sort of seal of international approval that makes it easier for countries to find aid elsewhere.

The additional U.S. contribution to the IMF, part of a $60-billion funding increase by the organization’s members worldwide, has encountered opposition in Congress.

Most of the IMF’s 155 other member countries already have approved their increases. But the United States holds the largest single stake in the organization, and, with economic problems at home mounting in an election year, lawmakers are increasingly leery of all types of foreign aid.

Brady warned that unless the additional U.S. funding is provided, the IMF may not be able to meet the increasing demands that it faces.

“The consequences of failure to pass the IMF quota legislation would be extremely adverse,” Brady said. “Without our support, the IMF quota increase cannot go into effect.”