The United States Conference of Catholic Bishops challenged President Joe Biden’s administration to take significant action on the global response to the COVID-19 pandemic in a letter Tuesday.
Perhaps the boldest of its proposals is a recommendation that the U.S. support a $3 trillion issuance of International Monetary Fund Special Drawing Rights, a global reserve currency that could provide much-needed liquidity to low-income nations.
The G-20 group of countries is nearing a consensus for an issuance of about $500 billion worth of SDRs, but it is unclear if the Biden administration will support the move. Former President Donald Trump’s administration had opposed it. A $3 trillion issuance would require congressional approval, adding a hurdle that could be avoided with the smaller issuance.
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The letter, sent by USCCB and the Jubilee USA Network, also calls for debt relief to be extended beyond the lowest-income countries and made available to middle-income nations. The G-20’s “Common Framework” debt process should “include the private sector, be timely, and cut debts to sustainable levels while lifting social protections and reducing poverty,” the letter states.
The U.S. should also lead an effort to “evaluate, increase and optimize” how multilateral development banks are using their funds, including a replenishment so that they can continue to increase the amount they are lending.
Finally, the letter calls for U.S. support in the ongoing international tax discussions to ensure they include public budget transparency, stop corruption and tax evasion, promote responsible lending and borrowing, and implement a global bankruptcy or crisis resolution process.
Why it matters: This type of letter on behalf of the Roman Catholic community is rare, and it calls for more dramatic action than previous letters from USCCB. It is also the first call of its magnitude for such a large issuance of SDRs.
Update, Feb. 24, 2021: This article has been updated to clarify that the G-20 is considering a $500 billion issuance of SDRs.
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About the author
Adva Saldinger@AdvaSal
Adva Saldinger is a Senior Reporter at Devex where she covers development finance, as well as U.S. foreign aid policy. Adva explores the role the private sector and private capital play in development and authors the weekly Devex Invested newsletter bringing the latest news on the role of business and finance in addressing global challenges. A journalist with more than 10 years of experience, she has worked at several newspapers in the U.S. and lived in both Ghana and South Africa.
