Proposition 50K1936

Projet de loi relatif à l'adhésion de la Belgique à la Société interaméricaine d'Investissement.

General information ¶

Submitted by

The Senate

Submission date

June 12, 2002

Official page

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Status

Adopted

Requirement

Simple

Subjects

development bank development aid

Voting ¶

Voted to adopt

Groen CD&V Vooruit Ecolo LE PS | SP Open Vld N-VA MR FN VB

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Discussion ¶

July 17, 2002 | Plenary session (Chamber of representatives)

Full source

We listen to the oral report. I have asked Mr. Tavernier to be concise, but yet to mention enough elements so that the Chamber is informed.

Mrs. Vice-Prime Minister, Mr. Minister, colleagues, the President has now obliged me to read the oral report so that one can find back in the Annals of the Chamber what was discussed and decided. In the Finance Committee of 16 July 2002, we discussed two bills. The first draft came from the Senate and deals with Belgium’s accession to the Inter-American Investment Company. The second bill was submitted by the government to the House and deals with the registration of Belgium on the capital of the Inter-American Investment Company.

I give the report in the language in which the door of service was opened. Minister van Financiën gave first an inleidende uiteenzetting. The Inter-American Investment Society is affiliated with the Inter-American Development Bank of which Belgium has been a member since 1976. Like other regional development banks, it aims to promote the economic and social development of its borrowing member countries. The Inter-American Development Bank was established in December 1959 and began operations on October 1, 1960. SII was established in 1984 and began its activities in 1989. Its objective is to promote the development of Latin America and the Caribbean by providing loans to small and medium-sized enterprises and preferably by taking part in their capital. Its capital amounts to more than US$200 million of which regional borrowing countries currently hold more than 50%, the United States 25% and non-regional member countries 21%.

If Belgium is allowed to join the BID SII among the members of the BID, only Canada and the United Kingdom will not be members. On the basis of the financial statements of 31 December 2001, since 1989, more than 2,590 companies in the region have been supported. The total cost of the investments made is more than $8 billion for a total IIS funding of $760 million, to which a total amount of $400 million for co-financing should be added; 87% of the company’s commitments have already been disbursed. According to the SII, each dollar it commits has helped to mobilize six in favor of companies that created 200,000 jobs, of which 38,000 in 2001.

Despite the positive developments, most small and medium-sized enterprises, representing, on average, 50% of the regional gross domestic product, remain deprived of long-term financing in the form of loans and participation, which has prompted IIS member countries to start discussions on capital increases.

An agreement was reached in May 1999 on a capital increase of $500 million in the form of 50,000 shares of $10,000 each, 4,729 of these shares being made available to BID member countries who wished to join the company.

Belgium was proposed to subscribe to 169 shares, or 0.24% of the capital of the SII to be compared with its share of 0.34% in the capital of the BID. The cost of this participation will amount to $1.69 million, or approximately the same amount in euros, and will extend over seven years.

If Belgium did not become a member of the IORS, the cooperation between investors, exporters and Belgian banks would suffer. In fact, the company would first appeal to companies from member countries and would only contact non-member countries as a last resort.

The transmission of information to companies would also be made more difficult by non-adherence.

Finally, knowing that support for small and medium-sized enterprises is one of the best tools for combating poverty, Belgium would risk depriving itself of an effective instrument of development aid.

Payments related to membership in the SII SII will be accounted for in the calculation of public development aid.

Taking into account these arguments and the fact that this capital increase could constitute the only opportunity to join the IIS, Belgium considered it desirable to accept the invitation to join and subscribe which was transmitted to it in accordance with the terms summarized below. De minister verklaart dat het zijn bedoeling is om de rol van België in Latijns-Amerika te benadrukken door in de futurst een algemene vergadering van de Inter-American Ontwikkelingsbank in Belgium you organize.

Following the introductory presentation by the Minister, a brief discussion was held in which Mr Borginon, Mr Maingain and your rapporteur spoke. Mr Borginon asked whether Belgium could exercise any real influence in the structures of this institution. He also raised the question of whether the subscription on the shares of the capital will be included in the budget of Development Cooperation or in the budget of Finance. He also asked from which ministry the material direction would come from.

Your rapporteur noted that the activities of the regional development banks are part of development cooperation. The subscription on the shares of the capital of the IIC is included in the Belgian contribution for development cooperation. The Government has set itself the goal of increasing the contribution to 0.7% of the gross domestic product by 2010. Therefore, it is ⁇ necessary that the contribution has relevance in the field of development aid.

In addition, it was noted that all major islands of the Caribbean, with the exception of Cuba, are members of the IIC. Your reporter therefore asked whether not being part of the organization was the express will of Cuba, or that it was, on the contrary, the result of a veto by the United States. Therefore, it was asked for the position of the minister on a possible Cuban membership.

The explanatory note also shows that the Government considers that Belgium should become a full member of the IIC. However, in the memory of explanation there is no sufficient legitimation. It was asked whether one joins with the intention to engage in development cooperation or to ⁇ corporate-economic return effects. It was also pointed out that only a capital increase seems to provide an opportunity to intervene. On the motivation, however, we remained somewhat unknown in the introduction and the explanation.

President Maingain asked which Member States of the European Union have not yet joined the Inter-American Development Bank. He asked whether all 15 member states would soon join the organization.

The Minister of Finance replied that the entry will be included in the budget of the Ministry of Finance. Two delegates from the Ministry of Finance currently have seats in the Board of Directors of the IMF and the World Bank. These delegates represent not only Belgium, but in fact also 9 other countries: the Grand Duchy of Luxembourg, Austria, the Czech Republic, Slovakia, Slovenia, Hungary, Turkey, Kazakhstan and Belarus.

In the various regional banks, the representative of Belgium represents exclusively its own country. The Minister suggested that it would be interesting to organize a hearing with both Belgian representatives at the IMF and the World Bank as well as with the representatives at the various regional banks.

Following a comment from the Finance Inspection on the return effect of Belgium’s accession to the inter-American investment company, the Minister pointed out that the initiative will have a positive impact on the results of the Belgian companies. However, the impact on the activities of the Belgian companies can only be assessed over time. He also stated that the accession of Belgium to the IIC will make it easier for Belgian companies and banks to access the Latin American market.

Although there will undoubtedly be revenue effects in the benefit of the Belgian companies, the Minister expressly stated that the accession should be seen first and foremost as a contribution to the further development of the Latin American countries. In addition, it was the Minister’s opinion that by becoming a member of the IIC Belgium will be able to defend with more conviction against the U.S. veto on Cuba’s membership. As Minister of Foreign Affairs, Mr. Louis Michel has already made a strong effort to improve relations between Cuba and the European Union. Since Belgium has already joined the African and Asian Development Banks, it is obvious that an effort is also being made for Latin America.

Recently, Scandinavian countries and Portugal have also joined the IIC. With the exception of the United Kingdom, which had no interest in this, Belgium is the only Member State of the European Union that has not yet joined. Canada is not joining for the time being because it received an unwanted number of votes. This is the reflection of the discussion. At the vote on the two draft laws, all articles and of course also the two full draft laws were unanimously adopted.