Second Reading Speech By Mr Lee Hsien Loong,Deputy Prime Minister / Minister For Finance,On The International Development Association (Amendment) Bill 2004, at The Parliament 19 Apr 2004

INTRODUCTION

1. Mr Speaker, Sir, I beg to move, 'That the International Development Association (Amendment) Bill 2004 be now read a second time'.

2. The Bill before the House seeks to amend the International Development Association (IDA) Act to enable the government to make future contributions to IDA beyond membership subscriptions. This amendment to the IDA Act will require a consequential amendment to the Constitution which will be introduced in the next item, the Constitution (Amendment) Bill 2004.

3. Currently, the IDA Act is only concerned with membership matters and is silent on Minister's power to contribute to IDA Replenishments. Therefore, the government has been relying on the Financial Procedures Act, instead of the IDA Act, to contribute to the IDA-13 Replenishment that we had pledged in 2002.

4. This is not efficient. To streamline the process, we should amend the IDA Act to standardise our procedures for contributing to IDA with those existing for other international organisations ("IOs"). For example, the ADB Act is used to contribute to the Asian Development Fund (ADF). Similarly, the IDA Act should be used for making IDA contributions.

5. After the amendments to the IDA Act and the Constitution, contributions to future IDA replenishments will be made using the IDA Act. The Minister, with the concurrence of the President under Article 144(1)(b) of the Constitution, will then be able to raise loans under section 6 on behalf of the Government (by the creation and issue of securities) to provide the sums required for making such contributions to the Association.

6. Mr Speaker, Sir, I beg to move.