article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Middle East and North Africa Transition and Development Act''. SEC. 2. FINDINGS. Congress makes the following findings: (1) The European Bank for Reconstruction and Development was created to support the transition of command economies to market economies following the collapse of communist regimes in 1989. (2) The Bank is the only international financial institution that-- (A) has a transition mandate; (B) includes political aspects to its mandate; and (C) seeks to assist only those countries that are committed to, and are applying, the principles of multiparty democracy, pluralism, and development of market economics in accordance with Article 1 of the Agreement Establishing the European Bank for Reconstruction and Development. (3) Egypt, which is a current shareholder of the Bank, has requested that the Bank consider Egypt's candidacy for becoming a country of activity. Consideration for including Egypt in the Bank's geographic mandate has been accelerated at the request of Egypt's interim government. (4) Other countries from the Middle East and North Africa, including Tunisia, have requested that the Bank consider their potential to become countries of activity. (5) The Bank estimates that approximately $4,000,000,000 per year could be provided for financial investment in new countries of activity in North Africa from the Bank's existing financial resources, without the need to call on its shareholders for additional capital. (6) The functions of the Bank are consistent with the critical and rising economic needs of Egypt and the Middle East and North Africa. SEC. 3. DEFINITIONS. In this Act: (1) Agreement establishing the european bank for reconstruction and development.--The term ``Agreement Establishing the European Bank for Reconstruction and Development'' means the Agreement establishing the European Bank for Reconstruction and Development, done at Paris May 29, 1990, and entered into force March 28, 1991. (2) Appropriate congressional committees.--The term ``appropriate congressional committees'' means-- (A) the Committee on Foreign Relations and the Committee on Appropriations of the Senate; and (B) the Committee on Financial Services and the Committee on Appropriations of the House of Representatives. (3) Bank.--The term ``Bank'' means the European Bank for Reconstruction and Development. (4) Country of activity.--The term ``country of activity'' means a country in which the Bank provides its resources for loans or other assistance, including through the use of special funds. (5) International financial institution.--The term ``international financial institution'' has the meaning given that term in section 1701(c)(2) of the International Financial Institutions Act (22 U.S.C. 262r(c)(2)). (6) Multilateral development bank.--The term ``multilateral development bank'' has the meaning given that term in section 1701(c)(4) of the International Financial Institutions Act (22 U.S.C. 262r(c)(4)). SEC. 4. UNITED STATES POLICY WITH RESPECT TO COUNTRIES LOCATED IN THE MIDDLE EAST AND NORTH AFRICA. (a) Policy Declaration.--It is the policy of the United States-- (1) to support a successful and sustainable transition to democracy in the Middle East and North Africa, including Egypt and Tunisia, that reflects the legitimate aspirations of the people in that region for greater political freedom and economic opportunity; and (2) to increase economic prosperity in that region through financial investment and technical assistance and by utilizing the resources of appropriate multilateral development banks. (b) Promotion of United States Policy.--The Secretary of the Treasury should instruct the United States Executive Director of the European Bank for Reconstruction and Development to use the voice and vote of the United States to promote the policies described in subsection (a). SEC. 5. NEGOTIATING OBJECTIVES WITH RESPECT TO AN AGREEMENT TO EXPAND THE MANDATE OF THE EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT TO COUNTRIES LOCATED IN THE MIDDLE EAST AND NORTH AFRICA. (a) In General.--The negotiating objectives of the United States with respect to an agreement described in subsection (b) should be to seek-- (1) criteria that are consistent with the criteria described in section 6(b) for the approval of loans or other assistance by the Bank for countries that become countries of activity as a result of the implementation of the agreement; and (2) the establishment by the Bank of a credible mechanism to ensure that countries of activity that are not committed to the fundamental principles of multiparty democracy, pluralism, and market economics do not continue to benefit from the resources of the Bank. (b) Agreement Described.--An agreement described in this subsection is an agreement to expand the use of the resources of the Bank for countries located in the Middle East or North Africa, including through an amendment to the Agreement Establishing the European Bank for Reconstruction and Development. SEC. 6. SUPPORT FOR LOANS AND OTHER ASSISTANCE PROVIDED BY THE BANK TO COUNTRIES OF ACTIVITY THAT MEET CERTAIN CRITERIA. (a) In General.--The Secretary of the Treasury should instruct the United States Executive Director of the Bank to use the voice and vote of the United States to oppose the approval of a loan or other assistance from the Bank to a country of activity in the Middle East or North Africa if the country does not meet the criteria described in subsection (b). (b) Criteria Described.--A country of activity meets the criteria described in this subsection if the government of the country-- (1) requests the Bank to conduct activities in the country; (2) meets, or is demonstrably committed to meeting, the criteria set forth in Article 1 of the Agreement Establishing the European Bank for Reconstruction and Development, including a commitment to ``the principles of multiparty democracy, pluralism and market economics''; (3) demonstrates a commitment to free, fair, and inclusive elections that meet international standards; (4) has a public commitment to universally recognized human rights and freedoms, including freedom of religion, association, assembly, and expression, and demonstrates a commitment to respect those rights and freedoms in practice; and (5) implements, or is demonstrably committed to implementing, economic reforms that advance private sector growth, improve the investment climate, increase transparency, especially transparency in public finances, and foster job creation. (c) Consultations With Congress With Respect to New Countries of Activity.--Not later than 10 days before a vote of the Board of Directors or the Board of Governors of the Bank to approve a country located in the Middle East or in North Africa as a new country of activity, the Secretary of the Treasury shall-- (1) notify the appropriate congressional committees of the vote; and (2) consult with those committees and describe to those committees how that country meets the criteria established by the Bank for being a country of activity. (d) Annual Report.--Not later than one year after the date of the enactment of this Act, and annually thereafter until the fifth year after such date of enactment, the Secretary of the Treasury shall submit to the appropriate congressional committees a report that includes the following: (1) A description of the activities of the Bank in each country of activity that is located in the Middle East or in North Africa. (2) The assessment of the Bank with respect to the ongoing eligibility of each such country to receive assistance from the Bank. (3) A description of how the activities carried out by the Bank in each such country during the preceding year served to promote the functions of the Bank, as described in Article 2 of the Agreement Establishing the European Bank for Reconstruction and Development. (4) An assessment of-- (A) the extent to which the activities of the Bank are complementary to the activities of other international financial institutions operating in the Middle East and North Africa; and (B) the extent of cooperation between the Bank and those other international financial institutions. (5) A list of any countries being considered to be new countries of activity. SEC. 7. SUPPORT FOR CLEAR STANDARDS FOR GRADUATION OF COUNTRIES OF ACTIVITY. The Secretary of the Treasury should instruct the United States Executive Director of the Bank to use the voice and vote of the United States to seek the adoption by the Bank of clear standards for the successful graduation of countries of activity if those countries have substantially achieved the transition objectives of the Bank. SEC. 8. AUTHORIZATION FOR THE EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT. (a) Findings.--Congress makes the following findings: (1) The request by the European Bank for Reconstruction and Development for subscription of capital is for callable shares only. Historically, callable shares, while requiring an authorization of funds, do not require an appropriation. (2) The International Programs Justification for Appropriations and Fiscal Year 2012 Budget Request of the Department of the Treasury for the European Bank for Reconstruction and Development is $0, stating that ``[t]his callable capital does not require appropriated funds''. (b) Authorization.--The European Bank for Reconstruction and Development Act (section 562(c) of Public Law 101-531; 22 U.S.C. 290l et seq.) is amended by adding at the end the following: ``(12) Capital increase.-- ``(A) Subscription authorized.-- ``(i) In general.--The United States Governor of the Bank may subscribe on behalf of the United States to not more than 90,044 additional callable shares of capital stock of the Bank, in accordance with Resolution 128, as adopted by the Board of Governors of the Bank at the annual meeting in Zagreb, Croatia, on May 14, 2010. ``(ii) Condition.--Any subscription by the United States to additional capital stock of the Bank shall be effective only to such extent and in such amounts as are provided for in advance by appropriations Acts. ``(B) Authorization of appropriations.--In order to pay for the increase in the United States subscription to capital stock of the Bank authorized under subparagraph (A), there are authorized to be appropriated $1,252,331,952, without fiscal year limitation, for payment by the Secretary of the Treasury.''. SEC. 9. STATUS OF COUNTRIES AS CANDIDATE COUNTRIES UNDER THE MILLENNIUM CHALLENGE ACT OF 2003. Section 606 of the Millennium Challenge Act of 2003 (22 U.S.C. 7705) is amended-- (1) in subsection (a)-- (A) in paragraph (1)-- (i) by amending the paragraph heading to read as follows: ``(1) In general.--''; (ii) in the matter preceding subparagraph (A), by striking ``fiscal year 2004'' and inserting ``any fiscal year''; (iii) by amending subparagraph (A) to read as follows: ``(A) the country-- ``(i) has a per capita income that is not greater than the World Bank's lower middle income country threshold for such fiscal year; and ``(ii) is among the 75 lowest per capita income countries, as identified by the World Bank; and''; and (iv) in subparagraph (B), by striking ``subject to paragraph (3)'' and inserting ``subject to paragraph (2)''; (B) by striking paragraph (2); and (C) by redesignating paragraph (3) as paragraph (2); (2) in subsection (b)-- (A) in paragraph (1)-- (i) in the matter preceding subparagraph (A), by striking ``for fiscal year 2006 or a subsequent fiscal year'' and inserting ``for any fiscal year''; and (ii) by striking subparagraphs (A) and (B) and inserting the following: ``(A) has a per capita income that is not greater than the World Bank's lower middle income country threshold for such fiscal year; ``(B) is not among the 75 lowest per capita income countries as identified by the World Bank; and ``(C) meets the requirements under subsection (a)(1)(B).''; and (B) in paragraph (2)-- (i) by striking ``for fiscal year 2006 or any subsequent fiscal year'' and inserting ``for any fiscal year''; and (ii) by striking ``for fiscal year 2006 or the subsequent fiscal year, as the case may be'' and inserting ``for such fiscal year''; (3) by redesignating subsection (c) as subsection (d); and (4) by inserting after subsection (b) the following: ``(c) Maintaining Candidate Status.--Beginning in fiscal year 2012, a country the per capita income of which changes during a fiscal year so that the country no longer meets the requirements for being a candidate country under subsection (a)(1) or (b)(1) shall, notwithstanding that change in per capita income, continue to be eligible to be a candidate country under subsection (a)(1) or (b)(1) (as the case may be) during that fiscal year and the 3 fiscal years thereafter to the same extent and in the same manner as if the per capita income of the country had not changed.''.
summary: Middle East and North Africa Transition and Development Act - States that it is U.S. policy to: (1) support a democratic transition in the Middle East and North Africa, including Egypt and Tunisia; and (2) increase economic prosperity in that region through financial investment and technical assistance and by utilizing the resources of appropriate multilateral development banks. States that U.S. negotiating objectives to expand the European Bank for Reconstruction and Development's (Bank) resources for countries in the Middle East or North Africa should be to seek: (1) specified lending criteria for loans or other Bank assistance for countries of activity (countries provided with Bank resources for loans or other assistance), and (2) establishment of a Bank mechanism to ensure that countries of activity not committed to multiparty democracy and market economics do not benefit from Bank resources. Urges the Secretary of the Treasury to use U.S. influence to: (1) oppose the approval of a loan or other Bank assistance to a country of activity in the Middle East or North Africa that does not meet specified criteria, and (2) seek the Bank's adoption of clear standards for the graduation of countries of activity that have substantially achieved required transition objectives. Amends the European Bank for Reconstruction and Development Act to authorize the U.S. Governor of the Bank to subscribe to additional shares of Bank stock. Authorizes appropriations for such purpose. Amends the Millennium Challenge Act of 2003 to: (1) revise candidate country criteria, and (2) permit a country that no longer meets the requirements for being a candidate country because of per capita income changes in a fiscal year to maintain such candidate status during such fiscal year and the next three fiscal years.