H.R. 5952: Sustainable International Financial Institutions Act of 2025

This bill, known as the Sustainable International Financial Institutions Act of 2025, outlines several key actions aimed at promoting clean energy and reducing reliance on fossil fuels through the influence of the United States in international financial institutions. Below are the main components of the bill:

1. Advocacy for Clean Energy Transition

The bill mandates that U.S. representatives in international financial institutions must:

• Support efforts to reduce greenhouse gas emissions and transition to a clean energy economy.
• Direct financial assistance towards countries developing sustainable energy systems.
• Oppose any financial support or investment that creates or expands fossil fuel capacities, including refurbishing existing fossil fuel facilities.
• Promote the phase-out of funding for internal combustion engines for passenger vehicles and buses by 2031.

2. Adjustment of U.S. Contributions to Financial Institutions

The Secretary of the Treasury has specific responsibilities to:

• Annually assess the financial contributions of international financial institutions towards new fossil fuel projects.
• Reduce U.S. contributions to these institutions based on the assessed fossil fuel investments.
• Deposit the reduced contribution amounts into an escrow account.
• Release the escrowed funds back to the institutions only when it is determined that they are no longer funding fossil fuel activity.
• Provide Congress with reports on the financial activities of these institutions regarding fossil fuel projects annually.

3. Prohibition on U.S. Assistance for Fossil Fuel Activities

The bill prohibits the U.S. from providing any form of financial assistance, directly or indirectly, to any country or entity for fossil fuel activities or related infrastructure. This includes assistance from various U.S. agencies, such as:

• United States International Development Finance Corporation
• Export-Import Bank of the United States
• Trade and Development Agency
• United States Agency for International Development (USAID)
• Millennium Challenge Corporation

4. Identified International Financial Institutions

The bill specifically mentions the following institutions where the U.S. is expected to exercise its voting power:

• International Bank for Reconstruction and Development
• International Development Association
• International Finance Corporation
• Multilateral Investment Guarantee Agency
• African Development Fund
• African Development Bank
• Asian Development Fund
• Asian Development Bank
• European Bank for Reconstruction and Development
• Inter-American Development Bank
• Inter-American Development Bank Invest
• North American Development Bank

5. Definitions

The bill provides definitions related to fossil fuels and fossil fuel activities, clarifying what falls under these terms, such as:

• Fossil fuel activity includes exploration, production, transportation, and combustion of fossil fuels.
• Fossil fuels comprise coal, oil, and natural gas, along with various derivatives and forms.

6. Policy Reform Definition

The term "policy reform" is defined to include changes that incentivize fossil fuel investments, such as altering taxation or energy tariffs that could encourage further fossil fuel activities.

Relevant Companies

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