What This Bill Does
This bill tells the United States Governor of the International Monetary Fund to use America's voice and vote to support Taiwan's admission to the IMF (Sec. 4). It also directs the Secretary of the Treasury to report to Congress each year about efforts to help Taiwan participate in international financial institutions (Sec. 5).
Who It Affects
The United States Governor of the International Monetary Fund, the Secretary of the Treasury, Congress, and Taiwan.
Key Provisions
• The United States Governor of the IMF must strongly support Taiwan's admission as a member of the Fund, if Taiwan seeks admission (Sec. 4(a)(1))
• The United States Governor must support Taiwan's participation in regular surveillance activities and economic reviews conducted by the Fund (Sec. 4(a)(2))
• The United States Governor must support employment opportunities for Taiwan nationals at the Fund without different restrictions than those applied to other member countries (Sec. 4(a)(3))
• The United States Governor must support Taiwan's ability to receive technical assistance and training from the Fund (Sec. 4(a)(4))
• The Secretary of the Treasury must tell Congress each year about efforts to support Taiwan's participation at international financial institutions (Sec. 5)
What Changes
The bill makes it official United States policy not to discourage Taiwan from seeking IMF membership (Sec. 4(b)). The United States will now actively work to support Taiwan's participation in the IMF through its Governor's vote and voice.
Important Definitions
None defined in bill text.
IIB
118TH CONGRESS
2D SESSION
H. R. 540
IN THE SENATE OF THE UNITED STATES
JANUARY 16, 2024
Received; read twice and referred to the Committee on Foreign Relations
AN ACT
To require the Secretary of the Treasury to pursue more
equitable treatment of Taiwan at the international finan-
cial institutions, and for other purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
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SECTION 1. SHORT TITLE.
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This Act may be cited as the ‘‘Taiwan Non-Discrimi-
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nation Act of 2023’’.
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SEC. 2. FINDINGS.
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Congress finds as follows:
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(1) As enshrined in its Articles of Agreement,
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the International Monetary Fund (IMF) is devoted
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to promoting international monetary cooperation, fa-
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cilitating the expansion and balanced growth of
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international trade, encouraging exchange stability,
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and avoiding competitive exchange depreciation.
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(2) Taiwan is the 21st largest economy in the
12
world and the 10th largest goods trading partner of
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the United States.
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(3) Although Taiwan is not an IMF member, it
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is a member of the World Trade Organization, the
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Asian Development Bank, and the Asia-Pacific Eco-
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nomic Cooperation forum.
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(4) According to the January 2020 Report on
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Macroeconomic and Foreign Exchange Policies of
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Major Trading Partners of the United States, pub-
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lished by the Department of the Treasury, Taiwan
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held $471,900,000,000 in foreign exchange reserves,
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more than major economies such as India, South
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Korea, and Brazil.
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(5) According to section 4(d) of the Taiwan Re-
1
lations Act (Public Law 96–8), enacted on April 10,
2
1979, ‘‘Nothing in this Act may be construed as a
3
basis for supporting the exclusion or expulsion of
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Taiwan from continued membership in any inter-
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national financial institution or any other inter-
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national organization.’’.
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(6) Taiwan held membership in the IMF for 9
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years following the recognition of the People’s Re-
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public of China (PRC) by the United Nations, and
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16 Taiwan staff members at the Fund were allowed
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to continue their employment after the PRC was
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seated at the IMF in 1980. As James M. Boughton
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has noted in his Silent Revolution: The International
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Monetary Fund 1979–1989, even as the PRC was
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seated, the United States Executive Director to the
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IMF, Sam Y. Cross, expressed support on behalf of
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the United States Government for ‘‘some kind of as-
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sociation between Taiwan and the Fund’’.
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(7) On September 27, 1994, in testimony be-
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fore the Senate Committee on Foreign Relations re-
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garding the 1994 Taiwan Policy Review, then-As-
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sistant Secretary of State for East Asian and Pacific
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Affairs Winston Lord stated: ‘‘Recognizing Taiwan’s
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important role in transnational issues, we will sup-
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HR 540 RFS
port its membership in organizations where state-
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hood is not a prerequisite, and we will support op-
2
portunities for Taiwan’s voice to be heard in organi-
3
zations where its membership is not possible.’’.
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(8) The Congress has repeatedly reaffirmed
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support for this policy, including in Public Laws
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107–10, 107–158, 108–28, 108–235, 113–17, and
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114–139, and the unanimous House and Senate
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passage of the Taiwan Allies International Protec-
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tion and Enhancement Initiative (TAIPEI) Act of
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2019.
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(9) In its fact sheet, entitled ‘‘U.S. Relations
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with Taiwan’’, published on August 31, 2018, the
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Department of State asserts: ‘‘The United States
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supports Taiwan’s membership in international orga-
15
nizations that do not require statehood as a condi-
16
tion of membership and encourages Taiwan’s mean-
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ingful participation in international organizations
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where its membership is not possible.’’.
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(10) According to the Articles of Agreement of
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the IMF, ‘‘membership shall be open to other coun-
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tries’’, subject to conditions prescribed by the Board
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of Governors of the IMF.
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(11) In the IMF publication ‘‘Membership and
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Nonmembership in the International Monetary
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Fund: A Study in International Law and Organiza-
1
tion’’, Joseph Gold, the then-General Counsel and
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Director of the Legal Department of the IMF, elabo-
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rated on the differences between the terms ‘‘coun-
4
tries’’ and ‘‘states’’, noting that ‘‘the word ‘country’
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may have been adopted because of the absence of
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agreement on the definition of a ‘state’ ’’ and, with
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respect to the use of ‘‘countries’’ and applications
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for IMF membership, ‘‘the absence of any adjective
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in the Articles emphasizes the breadth of the discre-
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tion that the Fund may exercise in admitting coun-
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tries to membership’’. According to Mr. Gold, ‘‘the
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desire to give the Fund flexibility in dealing with ap-
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plications may explain not only the absence of any
14
adjective that qualifies ‘countries’ but also the choice
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of that word itself’’.
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(12) In his IMF study, Mr. Gold further ob-
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serves, ‘‘in the practice of the Fund the concepts of
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independence and sovereignty have been avoided on
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the whole as a mode of expressing a criterion for
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membership in the Fund’’. He continues, ‘‘Although
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the Fund usually takes into account the recognition
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or nonrecognition of an entity as a state, there are
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no rules or even informal understandings on the ex-
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tent to which an applicant must have been recog-
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nized by members or other international organiza-
1
tions before the Fund will regard it as eligible for
2
membership.’’. In fact, when considering an applica-
3
tion for membership where the status of an appli-
4
cant may not be resolved, Mr. Gold writes ‘‘there
5
have been occasions on which the Fund has made a
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finding before decisions had been taken by the
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United Nations or by most members or by members
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with a majority of the total voting power.’’ Mr. Gold
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concludes, ‘‘the Fund makes its own findings on
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whether an applicant is a ‘country’, and makes them
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solely for its own purposes.’’.
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(13) Although not a member state of the
13
United Nations, the Republic of Kosovo is a member
14
of both the IMF and the World Bank, having joined
15
both organizations on June 29, 2009.
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(14) On October 26, 2021, Secretary of State
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Antony Blinken issued a statement in support of
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Taiwan’s ‘‘robust, meaningful participation’’ in the
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United Nations system, which includes the IMF, the
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World Bank, and other specialized United Nations
21
agencies. Secretary of State Blinken noted, ‘‘As the
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international community faces an unprecedented
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number of complex and global issues, it is critical for
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all stakeholders to help address these problems. This
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includes the 24 million people who live in Taiwan.
1
Taiwan’s meaningful participation in the UN system
2
is not a political issue, but a pragmatic one.’’. He
3
continued, ‘‘Taiwan’s exclusion undermines the im-
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portant work of the UN and its related bodies, all
5
of which stand to benefit greatly from its contribu-
6
tions.’’.
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SEC. 3. SENSE OF THE CONGRESS.
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It is the sense of the Congress that—
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(1) the size, significance, and connectedness of
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the Taiwanese economy highlight the importance of
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greater participation by Taiwan in the International
12
Monetary Fund, given the purposes of the Fund ar-
13
ticulated in its Articles of Agreement; and
14
(2) the experience of Taiwan in developing a vi-
15
brant and advanced economy under democratic gov-
16
ernance and the rule of law should inform the work
17
of the international financial institutions, including
18
through increased participation by Taiwan in the in-
19
stitutions.
20
SEC. 4. SUPPORT FOR TAIWAN ADMISSION TO THE IMF.
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(a) IN GENERAL.—The United States Governor of
22
the International Monetary Fund (in this section referred
23
to as the ‘‘Fund’’) shall use the voice and vote of the
24
United States to vigorously support—
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HR 540 RFS
(1) the admission of Taiwan as a member of
1
the Fund, to the extent that admission is sought by
2
Taiwan;
3
(2) participation by Taiwan in regular surveil-
4
lance activities of the Fund with respect to the eco-
5
nomic and financial policies of Taiwan, consistent
6
with Article IV consultation procedures of the Fund;
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(3) employment opportunities for Taiwan na-
8
tionals, without regard to any consideration that, in
9
the determination of the United States Governor,
10
does not generally restrict the employment of nation-
11
als of member countries of the Fund; and
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(4) the ability of Taiwan to receive appropriate
13
technical assistance and training by the Fund.
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(b) UNITED STATES POLICY.—It is the policy of the
15
United States not to discourage or otherwise deter Taiwan
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from seeking admission as a member of the Fund.
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(c) WAIVER.—The Secretary of the Treasury may
18
waive any requirement of subsection (a) for up to 1 year
19
at a time on reporting to Congress that providing the
20
waiver will substantially promote the objective of securing
21
the meaningful participation of Taiwan at each inter-
22
national financial institution (as defined in section
23
1701(c)(2) of the International Financial Institutions
24
Act).
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(d) SUNSET.—This section shall have no force or ef-
1
fect on the earlier of—
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(1) the date of approval by the Board of Gov-
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ernors of the Fund for the admission of Taiwan as
4
a member of the Fund; or
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(2) the date that is 10 years after the date of
6
the enactment of this Act.
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SEC. 5. TESTIMONY REQUIREMENT.
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In each of the next 7 years in which the Secretary
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of the Treasury is required by section 1705(b) of the
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International Financial Institutions Act to present testi-
11
mony, the Secretary shall include in the testimony a de-
12
scription of the efforts of the United States to support
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the greatest participation practicable by Taiwan at each
14
international financial institution (as defined in section
15
1701(c)(2) of such Act).
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Passed the House of Representatives January 12,
2024.
Attest:
KEVIN F. MCCUMBER,
Clerk.
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