text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as ``Foreign Credit Reform Act of 2004''.
  
  SEC. 2. FINDINGS.
  
      Congress finds the following:
              (1) Unsustainable debt in the world's poorest countries 
          constitutes a serious impediment to the development of stable 
          democratic political structures, broad-based economic growth, 
          poverty eradication, and food security.
              (2) Financing should be appropriate for the purposes for 
          which it is used and should, to the maximum extent possible, 
          generate a return sufficient to pay the principal and interest 
          due. As such, long-term lending for perishable goods, such as 
          food commodities, may be construed as inappropriate to the 
          extent that it places a long-term debt burden on the recipient 
          country without generating sufficient revenues with which to 
          service the debt.
              (3) Since 1955, the United States has extended more than 
          $27,800,000,000 in loans for food under title I of the 
          Agricultural Trade Development and Assistance Act of 1954 
          (commonly referred to as ``PL 480''), $10,632,858,000 of which 
          remained outstanding at the end of 2002.
              (4) As of December 31, 2002, arrears on principal and 
          interest payments under title I of PL 480 totaled 
          $1,241,472,000.
              (5) Since 1992 the United States provided the independent 
          states of the former Soviet Union with $1,601,500,000 in loans 
          for food under title I of PL 480, for which these countries are 
          estimated to have paid $112,748,000 in principal and interest 
          in 2003. Russia alone has received $1,035,000,000 in credits, 
          paying an estimated $79,695,000 in principal and interest in 
          2003.
              (6) Rising debt stocks and debt-to-export ratios may 
          undermine a country's credit worthiness and jeopardize its 
          ability to borrow from commercial lenders.
              (7) Debt reduction contributes marginally to a country's 
          development prospects if new debt is allowed to create the next 
          generation of heavy indebtedness. Therefore, President Bush's 
          initiative, adopted by Group of Seven (G-7) leaders at the June 
          2002 summit, to increase World Bank grant assistance to the 
          most heavily indebted poor countries is a crucial step toward 
          alleviating poverty, curbing future unsustainable debt, and 
          providing for urgent human needs in countries in which people 
          live on less than one dollar a day. Replacing loans with 
          targeted grants will eliminate the need for governments to 
          repay long-term investments in people, especially for 
          education, health, nutrition, water supply, and sanitation 
          purposes.
              (8) The G-7 agreement at the June 2002 summit to fully fund 
          the remaining costs of the enhanced Heavily Indebted Poor 
          Country (HIPC) initiative is essential to ensuring that 
          eligible debt-distressed nations receive full benefits under 
          the HIPC debt relief measure.
              (9) The United States has been a leading voice for more 
          than a decade in international debt reduction initiatives for 
          poor countries, including a 1991 initiative to cancel 
          $689,000,000 in food loans under title I of PL 480 owed by 15 
          sub-Saharan African countries.
              (10) The United States must continue its leadership role to 
          encourage full participation by all Paris Club creditors in 
          multilateral debt negotiations.
              (11) Several poor countries that are not eligible for 
          enhanced HIPC debt reduction terms face a severe debt overhang 
          that undermines increased resource allocation for development 
          and discourages productive investment.
              (12) The World Bank, which has provided over $1,700,000,000 
          since 1986 to fight the spread of HIV/AIDS, should continue to 
          place the highest priority on programs to combat infectious 
          diseases, including HIV/AIDS, malaria, and tuberculosis.
              (13) Debt reduction is an important, but only partial 
          solution to long-term development. Promoting an environment 
          that will stimulate internal economic growth, promote trade and 
          external investment, and encourage responsible governance are 
          the most important ingredients for sustainable growth.
  
                     TITLE I--MULTILATERAL DEBT RELIEF
  
  SEC. 101. SUPPORT FOR THE HIPC TRUST FUND.
  
      Section 801(b)(1) of H.R. 5526 of the 106th Congress, as introduced 
  on October 24, 2000, and enacted into law by section 101(a) of Public 
  Law 106-429 (and contained in the appendix thereto) is amended by 
  striking ``2003, $435,000,000'' and inserting ``2006, such sums as may 
  be necessary''.
  
  SEC. 102. DEBT SERVICE REINVESTED INTO THE GLOBAL FUND.
  
      The Bretton Woods Agreements Act (22 U.S.C. 286-286oo) is further 
  amended by adding at the end the following:
  
  ``SEC. 64. DEBT SERVICE REINVESTED INTO THE GLOBAL FUND.
  
      ``(a) Negotiation of Agreement.--The Secretary of the Treasury 
  shall seek to negotiate an agreement among the member countries of the 
  Bank and the Fund, under which, on approval by the Global Fund of a 
  grant proposal originating from an eligible country, the Bank and the 
  Fund shall make a contribution to the Global Fund in an amount equal to 
  the amount of the grant award for the year, except that the total 
  amount of the contributions so made with respect to the country during 
  a year shall not exceed the total amount of debt service payments made 
  by the country to the Bank and the Fund during the year.
      ``(b) Definitions.--In this section:
              ``(1) Global fund.--The term `Global Fund' means the 
          public-private partnership known as the Global Fund to Fight 
          AIDS, Tuberculosis and Malaria that was established upon the 
          call of the United Nations Secretary General in April 2001.
              ``(2) Eligible country.--The term `eligible country' means 
          a country--
                      ``(A) which has received debt relief under the 
                  Enhanced HIPC Initiative; and
                      ``(B) in which the prevalence of HIV/AIDS among 
                  individuals who have attained 15 years of age but have 
                  not attained 49 years of age is not less than 5 
                  percent.
              ``(3) Enhanced hipc initiative.--The term `Enhanced HIPC 
          Initiative' means the multilateral debt initiative for heavily 
          indebted poor countries presented in the Report of G-7 Finance 
          Ministers on the Cologne Debt Initiative to the Cologne 
          Economic Summit, Cologne, June 18-20, 1999.
              ``(4) HIV/AIDS.--The term `HIV/AIDS' means, with respect to 
          an individual, an individual who is infected with HIV or living 
          with AIDS.
              ``(5) HIV.--The term `HIV' means the human immunodeficiency 
          virus, the pathogen that causes AIDS.
              ``(6) AIDS.--The term `AIDS' means the acquired immune 
          deficiency syndrome.''.
  
                      TITLE II--BILATERAL DEBT RELIEF
  
  SEC. 201. ACTIONS TO PROVIDE BILATERAL DEBT RELIEF.
  
      Section 501(i) of H.R. 3425 of the 106th Congress, as introduced on 
  November 17, 1999, and enacted into law by section 1000(a)(5) of Public 
  Law 106-113 (and contained in Appendix E thereto), is amended by 
  striking ``2004'' and inserting ``2005''.
  
  SEC. 202. DEBT FORGIVENESS UNDER TITLE I OF PUBLIC LAW 480.
  
      (a) Debt Forgiveness.--For each of the fiscal years 2005 and 2006, 
  the President is authorized and encouraged to use the authority of 
  section 411 of the Agricultural Trade Development and Assistance Act of 
  1954 (7 U.S.C. 1736e) to waive payments of principal and interest that 
  a country described in subsection (b) would otherwise be required to 
  make to the Commodity Credit Corporation under dollar sales agreements 
  under title I of such Act (7 U.S.C. 1701 et seq.).
      (b) Country Described.--A country referred to in subsection (a) is 
  a country--
              (1) which has outstanding public and publicly guaranteed 
          debt, the net present value of which on December 31, 2003, was 
          at least 150 percent of the value of exports of the country in 
          2003; or
              (2) whose debt service payments on public and publicly 
          guaranteed debt exceeded 8 percent of the value of its exports 
          in 2003.
      (c) Applicable Provisions.--Except to the extent inconsistent with 
  the provisions of this section, section 411 of the Agricultural Trade 
  Development and Assistance Act of 1954 (7 U.S.C. 1736e) (except 
  subsection (e) of such section) shall apply with respect to the 
  authority to waive payments of principal and interest under this 
  section to the same extent and in the same manner as such section 
  applies to the authority to waive payments of principal and interest 
  under section 411 of such Act.
      (d) Authorization of Appropriations.--For the cost (as defined in 
  section 502 of the Federal Credit Reform Act of 1990) for the reduction 
  or cancellation of any debt pursuant to this section, there are 
  authorized to be appropriated to the President for each of the fiscal 
  years 2005 and 2006 such sums as may be necessary.
  
  SEC. 203. MISCELLANEOUS AMENDMENTS.
  
      (a) Financing Assistance Under Title I of Public Law 480.--Section 
  101(b) of the Agricultural Trade Development and Assistance Act of 1954 
  (7 U.S.C. 1701(b)) is amended--
              (1) by striking ``To carry out the policies'' and inserting 
          the following:
              ``(1) In general.--To carry out the policies'';
              (2) by striking ``developing countries'' and inserting 
          ``developing countries described in paragraph (2)''; and
              (3) by adding at the end the following:
              ``(2) Developing country described.--A developing country 
          referred to in paragraph (1) is a developing country that meets 
          the following requirements:
                      ``(A) The country is not prohibited from receiving 
                  assistance under the Foreign Assistance Act of 1961 by 
                  reason of the application of section 620(q) of such Act 
                  and irrespective of whether or not the President has 
                  determined that assistance to the country is in the 
                  national interest of the United States.
                      ``(B) The country is not in default, during a 
                  period in excess of six calendar months, in payment to 
                  the United States of principal or interest on any loan 
                  made to such country under this title or under any 
                  other provision of law.
                      ``(C) The country is not a low-income country or 
                  lower-middle income country, as defined by the 
                  International Bank for Reconstruction and Development 
                  in its World Development Indicators Report (issued in 
                  April 2004 and updated annually).
                      ``(D) The country is not a severely-indebted 
                  country or moderately-indebted country as defined by 
                  the International Bank for Reconstruction and 
                  Development in its World Development Indicators Report 
                  (issued in April 2004 and updated annually).''.
      (b) Economic Assistance Under the Foreign Assistance Act of 1961.--
  Section 620(q) of the Foreign Assistance Act of 1961 (22 U.S.C. 
  2370(q)) is amended--
              (1) by inserting after ``under this Act'' the second place 
          it appears the following: ``or under title I of the 
          Agricultural Trade Development and Assistance Act of 1954 (7 
          U.S.C. 1701 et seq.)''; and
              (2) by adding at the end the following: ``A determination 
          by the President under the preceding sentence that assistance 
          to a country is in the national interest of the United States 
          shall be effective for a period not to exceed one calendar 
          year.''.
target: Foreign Credit Reform Act of 2004 - Amends Federal law to extend authorization of appropriations for the U.S. contribution to the Heavily Indebted Poor Country (HIPC) Trust Fund.
  
  Amends the Bretton Woods Agreements Act to direct the Secretary of the Treasury to negotiate an agreement under which the International Bank for Reconstruction and Development and the International Monetary Fund shall contribute to the Global Fund to Fight AIDS, Tuberculosis and Malaria an amount equal to the amount of a country's annual debt service made to the Bank and the Fund.
  
  Authorizes the President to waive certain Agricultural Trade Development and Assistance Act of 1954 principal and interest payments owed to the Commodity Credit Corporation by eligible debt-heavy countries for FY 2005 and 2006. Amends such Act to define "developing country" for purposes of title I assistance.
feat_title: To provide multilateral and bilateral debt relief for developing countries, and for other purposes.