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The legislation strengthens the G-20’s Common Framework, a multilateral debt relief initiative, to reflect the challenges countries have faced during the pandemic. Critically, the legislation also places a moratorium on debt payments for countries that are applying to be part of the Common Framework.
“Developing nations whose early economies and political systems were crippled by colonialism and foreign intervention deserve a real opportunity to compete – to build independent, sustainable economies, unburdened by impossible levels of debt,” said Rep. Ocasio-Cortez in a statement. “This bill will also have benefits at home as well as overseas. The race-to-the-bottom for wages that has cost the U.S. so many manufacturing jobs is driven by the economic vulnerability of developing nations. We can’t have a healthy, competitive global economy, as long as the whims of a handful of nations dictate the financial stability of the rest of the world.”
In addition to this bill, the COMPETES Act also included an amendment from Rep. Ocasio-Cortez, which prevents companies from using any of the $52 billion in federal incentives allocated to produce semiconductors from being used on stock buybacks or the payment of dividends to shareholders. The goal is to ensure that federal funding is actually used to incentivize the production of critical goods, rather than being used to enrich corporate executives.