The US Treasury Embraces Transparency

May 17, 2016 8:00 PM

After 40 years, the US Treasury has stopped protecting information on the holdings of claims on the United States by members of the Organization of Petroleum Exporting Countries (OPEC). Instead of reporting the aggregate claims by Middle Eastern and African oil exporters, the Treasury is now reporting claims of individual countries. In addition, claims of offshore financial centers will be individually reported. As I have argued in private and public to my former colleagues at the Treasury and Federal Reserve for more than a decade, this change is long overdue.

The principal impetus came from interest in the holdings by Saudi Arabia of US Treasury securities in the wake of pressures on Saudi reserves from lower oil prices. We now know that as of the end of March 2016 total Saudi holdings of US Treasury securities were $117 billion, presuming that most of these holdings were by the Saudi Arabian Monetary Agency. This total is much less than the $750 billion reported in some press stories. Credit for bringing about this change in policy should go to Andrea Wong of Bloomberg News, who raised this issue less than four months ago. Credit also goes to Treasury and Federal Reserve officials who were able to reconsider US policy in this area and change it in record time.