Treasury secretary urges IMF and World Bank to refocus; lawmakers press for SDR and RST reforms

Chairman Hill opened the House Financial Services Committee hearing by describing the session as "the annual testimony of the secretary of the treasury on the state of the international financial system." The hearing focused in part on the role of the International Monetary Fund, the World Bank and regional development banks in supporting U.S. interests.

Treasury Secretary Scott Bissett told the committee that "America First does not mean America alone" and said the administration seeks to "expand US leadership in international institutions like the IMF and the World Bank." He said Treasurywants the institutions to return to "basics"—macroeconomic stability and economic development—rather than what he and some members described as mission creep into issues such as climate and social policy.

Committee members pressed specific reforms. Chairman Hill and others criticized the IMFspecial drawing rights (SDR) process, citing prior allocations that members said provided large, unconditional liquidity to China, Russia, Iran and Venezuela. Hill said future SDR allocations must involve congressional input. Secretary Bissett told the committee "the SDR process at the IMF should serve the goals of The United States Of America" and that Treasury is "aligned with you in your goals on the SDR." He also said the IMF should "get back to basics" and work with countries facing market failures rather than providing broad general allocations to well‑financed economies.

On the IMFResilience and Sustainability Trust (RST), members including Rep. Lucas asked whether Treasury would push to eliminate or downsize the facility so the IMF would focus on traditional balance-of-payments and crisis‑lending functions. Bissett said at IMF week he had stressed "the need to get back to basics at all of the multilateral development banks, especially the IMF." He did not announce a formal plan to terminate the RST during the hearing.

Members also discussed World Bank financing for China and other upper‑middle‑income countries. Chairman Hill praised recent World Bank openness to financing nuclear energy and noted bipartisan support for trust funds to finance nuclear projects at multilateral banks; Bissett said the administration supports efforts to expand financing for civilian nuclear power at multilateral development banks.

Why it matters: SDR allocations, multilateral bank mandates and trust fund priorities shape which countries receive finance and with what conditionality. Changes sought by members would alter how international institutions allocate large amounts of liquidity and how development projects are prioritized.

Committee members asked for follow-up briefings and written responses on specific proposals, including whether future SDR allocations should require congressional sign‑off and how Treasury plans to press multilateral banks on project selection and conditionality. The committee did not vote on legislation at the hearing; members asked Treasury to work with Congress on possible statutory fixes to the SDR and multilateral bank governance processes.

Sources: oral testimony and member questions at the House Financial Services Committee hearing; opening remarks by Chairman Hill and Secretary Scott Bissett.