§ 262p — Impact Adjustment Lending Programs

(a) The Secretary of the Treasury shall instruct the United States Executive Director of the International Bank for Reconstruction and Development and the International Development Association to initiate discussions with other directors of the respective institutions and to propose that— (1) guidelines be established which reflect clear and tangible concern for the impact adjustment lending programs, and the activities in support of which such lending is made, have and will have on human welfare; and (2) impact statements be required which assess the effect an adjustment lending program, and the activities in support of which such lending is made, will have on the poor of the country to which such lending is made. (b) In the discussions referred to in subsection (a) with respect to the impact statement described in paragraph (2) of such subsection, the United States Executive Director should propose that such impact statements— (1) specify what the projected effects of the adjustment loan will be on the poor; (2) explain what procedures have been or will be taken to strengthen the in-country capacity of the borrower to— (A) monitor nutrition levels in a timely manner; and (B) measure the impact an adjustment loan, and the policies and activities in support of which such loan is made, has on the living standards of the country’s population, especially the poorest; and (3) indicate specifically what steps the borrower will take to— (A) mitigate any adverse effect the policies and activities in support of which an adjustment loan is made are expected to have on the living standards of the poor (including the use of the proceeds of any adjustment loan, project aid, or other compensatory measure to mitigate such effect); and (B) maximize the extent of the participation of the poor in the economic benefits resulting from an adjustment loan. (c) The Secretary of the Treasury shall instruct the United States Executive Director of the International Bank for Reconstruction and Development and the International Development Association to request the management of the respective institutions to prepare a report for distribution to member governments no later than June 30, 1988, that— (1) assesses the impact on the poor of structural adjustment in countries to which structural adjustment lending has been made; and (2) specifies the steps that have been or will be taken by the respective institution to— (A) mitigate any adverse effect of adjustment lending, and the activities in support of which such lending is made, on the living standards of the poor in the countries to which such loans are made; and (B) ensure the participation of the poor in the economic benefits resulting from adjustment lending and the activities in support of which such lending is made. (d) For purposes of this section and section 262m–1 of this title, the term “adjustment lending” means nonproject lending in support of structural macroeconomic reforms or sectoral economic reform.