September 22, 2000
Prague, Czech Republic,PROCEEDINGS
MR. ABDEL-LATIF: So I think we should call the meeting to order. My name is Jalal [ph.] Abdel-Latif. I am from Ethiopia with the Interasca [ph.] Group. I am affiliated with the NGO Working Group Global Committee. I am the convener for the African region.
I would like to welcome all of you. Today we have a number of NGOs from a range of sectors. We are about 20 journalists. And I would like to thank all of you for attending this high quality public event.
All of you know and I don't need to introduce Mr. Wolfensohn. I am very pleased to have him here. This is a public event. The format will consist of questions and answers and we will allow about two to three minutes per question. We will try to cluster the themes and country issues, and would like to have Mr. Wolfensohn be frank, open and candid about his answers.
One reminder, if any of you have cell phones, please turn them off. Before I go further, I would like to welcome Mr. Wolfensohn.
MR. WOLFENSOHN: Well, thank you very much, Jalal. And let me say first of all welcome to all of you. I am extremely happy to have the chance to have a dialogue. I am looking forward to getting your questions so that I can get a sense of what is on your minds.
I think probably the best format for me would be to hear from you and then try and respond to the questions, as Jalal said, either in groupings or on thematic subjects. So, if we could hear from you, I think that probably would be the most positive way to start, and I will try and be open in my responses.
If I don't know some details, I hope that I have some colleagues here who may be able to provide some of the detailed answers to you, but I think I have got a pretty good overall impression of what we are doing, and we will try and be as open as we can today. And if there are issues that I cannot deal with specifically today, then I will make sure that you get detailed answers during the coming days.
So, thank you very much for being here. I am delighted that it is such a broad-based group and that there is so much interest in what we are doing, and that we are able to sit down and to discuss it. So, Jalal, I will be very happy to answer any questions and I will take copious notes so that I can do it.
MR. ABDEL-LATIF: Thank you. Just to remind you, we have Russian, French and Spanish interpretation. To begin with, I would like to recognize Tomas [ph.]. He will have some remarks to make.
QUESTION: Good morning. My name is Tomas Zaritski [ph.]. I work for East European Bankwich [ph.]. You may be aware that over the last two years a really big group of NGOs from all around the world met to discuss the Bank activities and the Bank projects. And they asked me to make a statement on their behalf.
MR. WOLFENSOHN: Please.
QUESTION: We considered not coming to this meeting because so many NGOs were not accredited or unable to get a visa to get to the Czech Republic. We believe that is demonstrating that the Bank was either unwilling, unable or both to hear the voices of those NGOs and the people they represent.
Noting that there are so many of us who are not able to speak and that are not healthier, we would like to invite you to come outside of the restricted area and talk to these people who are not here. Thank you.
MR. ABDEL-LATIF: I will open for questions now.
QUESTION: I am [inaudible], Mexico.
Mr. Wolfensohn, yesterday in a press conference you talked about the need to give people a voice in development. Of course, that means giving people an opportunity to actively participate in the identification, design and implementation of Bank projects and lending. People, however, cannot participate without information and the proposed change into the information policy does not fully support participation in development decisions.
When certain additional material related to project evaluation will be made available, the poor people will need the following documents in order to fully use their voice -- the release of aid memoirs or drafts of project preparation documents will help people to better participate in project preparation. The release of the President's reports for adjustment lending will allow people to understand the participation in structural adjustment loans. The release of status reports for projects or tranche release memoranda for adjustment lending will allow people to monitor the implementation of loan agreements and project objectives.
Similarly, the release of country assistance strategies will help hundreds of millions of people who are currently denied the right to access the Bank's basic blueprint for the country. None of these documents are being proposed for release under the draft review paper despite the fact that these documents are all owned by the Bank and hence it is the responsibility of the Bank to decide on their availability.
Mr. Wolfensohn, would you commit to release the previously mentioned documents and fulfill the call of the IDA Deputies by ensuring that project affected people can meaningfully participate in Bank operations? This is my question.
And I also want to deliver this letter that comes from a group of grassroots leaders in Mexico that are involved in a project that is called World Development (?)?
MR. WOLFENSOHN: Certainly. Do you want me to date it also?
QUESTION: Thank you.
MR. ABDEL-LATIF: Okay. This is the issue about documentation, access to information. Is there any related question on access, on reports, on participation in preparation of the documentation. I would like to just cluster similar issues if anybody has them.
MR. ABDEL-LATIF: Mr. Wolfensohn.
MR. WOLFENSOHN: Let me first of all talk about visas and coming to the meetings. I didn't issue the visas. I did not issue the visas. I was anxious from the very beginning to have a dialogue, not a confrontation outside the building. If you don't believe me, just think if you were in my position, it makes much more sense to talk than not to talk. And we have 350 NGOs now registered to come into these meetings which is twice the number from last year.
I have told my people right from the beginning that either I or they are prepared to have as rich a dialogue as we possibly can. We thought that what we had done here was to create a basis for that dialogue. If you think we should go further, then I suggest we can talk to my colleagues to try and see how we can try and work out further discussions. Certainly, I am prepared to ensure that we try and have as full discussions as we can, but I want to have them in an environment where there are discussions and where we can get down to some serious business.
If those conditions are satisfied, which is what we are doing this morning, then, as you can see, I am prepared to be there. So, I suggest that if there are people who are excluded, then let's take it up with my colleagues. I have got lots of people here who are ready to sit down and talk. And so far as I am concerned, the positive aspect of the demonstrations is that it gives a basis to get out what are the problems and to have a discussion.
I would like just to comment on the fact that somehow there is the feeling that there is a lack of willingness to engage NGOs or civil society. And I simply want to say to you that the record is somewhat different so far as the Bank is concerned. Five years ago we had two people in the institution who were interfacing with civil society -- two people. We now have over 80 that are out in the field and are meeting with civil society on a constant basis.
In countries we are on the ground and operating within the framework of whatever budgets we have got. Our objective is to reach out. My first speech was about inclusion. I have had a public and very real approach to what I believe to be true, which is that there is no way that we can deal with the issue of poverty unless all of us come together to try and deal with it. I have tried in the Bank to have myself and my colleagues recognize that there is a legitimate view on the part of civil society, even if it frequently comes through on a basis of personal abuse, but that you do need to think through and listen to what people are saying.
My hope is that with the respect that I think we are giving to the views of civil society that for a moment it may be possible to have the reverse happen. When I came to the Bank, there was a very clear view in the Fifty Years is Enough literature, which I read with great care, because it preceded my taking on my job. I got a very clear image of what civil society thought about the Bank, and I might tell you I got quite a clear view of what many people in the Bank thought about civil society.
And there were two boxes. Civil society thought the Bank was evil incarnate and people in the Bank thought that civil society was there to cause them to lose their jobs or to close the building down. And that wasn't far from the truth in those days. And if you read the literature, in fact, that is what Fifty Years is Enough campaign was designed to do. It said quite explicitly the Bank has done no good; close it down.
So, my hope when I came in was to try and see if we could recognize what I believe to be the case, that the voice of civil society is a necessary element in development, but I equally feel that the Bank can be very helpful to civil society. And, in fact, it is not for me in many countries to be able to ordain that the governments of the countries engage in a dialogue with civil society. I am not elected as the Prime Minister or President of many of the countries. And in many of the countries they regard civil society as the opposition, not part of the ruling clique.
So, what I have had to do is to try with the comprehensive framework, with consultative processes to try and engage civil society. And since I started at the Bank, on every visit to countries I have met with civil society, often with some frowns on the part of my hosts. But I have tried to reach out. So, the notion that we are not trying to engage civil society is something that I would like you to reconsider because all the evidence is that we are trying.
Now we may not be doing it as effectively as you want. But it is a hell of a lot different than it was five years ago. There is a dialogue taking place. And I would continue to expect that you will say to me it is not enough; now let's have more disclosure, let's come up with more information so that we can be more actively involved in the debate.
Now about 85 percent of our CASs are now made public. We have said that so far as the Bank is concerned, we would make all of them public. The Bank has no problem in making the country assistance strategies public. And, in fact, we are trying to reach out and have discussions on the creation of country assistance strategies. In some cases, they are effective; in some cases, some members of civil society say this is Hollywood, there is no real substantial discussion. And it varies, frankly, by the country, by the people that I have in the field and by the NGOs. Sometimes they get on and there can be discussions. Sometimes -- [microphone off].
But what I believe is happening is that the general level of discussion is becoming much greater than it was, and I think the process of cultural change, that is having us deal with NGOs, is becoming more real.
As to the question of transparency and disclosure, you have got to understand that I report to a Board of Directors. The Board of Directors is not homogeneous. Some of the members of the Board of Directors feel warmly to civil society. Others of them feel a lot less warmly. They regard the function of putting projects together as being a government function. So, what we are doing is trying to bring the Board along with an ever-increasing amount of disclosure. What I don't want to have happen from a point of view of the inside workings of the Bank is that, if there are memoranda that are going from people, one to the other, that are speculative while people are trying to work out something, that they have to watch every word that they are writing so that before they reach their conclusions there cannot be a dialogue any more than you probably would in your own organizations want to have your personal traffic regulated and made public.
So, I have to say to you that I have one concern which is to make sure my processes work all right. But once we have reached a conclusion, I have no objection whatsoever to put that speculative conclusion up for discussion. I have no problem with that. But what I do have to say to you is that we are currently looking at the policy of disclosure. We are having very deep debates with the Board. I believe that we are going to come out in January or February -- is that the time for the new disclosure policy? Does anybody know? It is early next year in any event that we will be coming out with a new discussion policy.
And you will see that there are regular improvements that we are making. Whether we will go as far as you want in the next round, I cannot promise you. But I can promise you that we will have a big step forward in the next round and I will continue to try and have full disclosure.
So, give us a chance to try and work the Board and everybody to a sense of making full disclosure, but accept from me that so far as I am concerned, the quality of discussion and the outreach to try and engage civil society in all its forms is something that I am deeply committed to. But there is a need for cultural change on both sides. There is a need for cultural change in the Bank to trust NGOs and to talk to them. But there is an equal need for some members of civil society to give us a chance and not come and say that because it is the Bank, it must be evil. There is a need for some balance.
I would hope that if we are going to move together that you could recognize that the moral high ground isn't always with NGOs, that some of colleagues feel that we are actually doing a good job too and that we are trying to help the issues of poverty.
And so, I would ask for a period in which there can be some calm and some opportunity to try and build a bridge. It is very difficult to build a bridge if only one side is trying to build it. And so, I would simply ask that as we try and build it, show a bit of tolerance of the extent of change and even look in your own organizations and see whether there is the degree of change in relation to us or whether there is a fixed view that whatever we do is not enough.
So, give us a chance and I think you will find that we will be very good partners and, if we treat each other with respect, I think there is a very good chance that year on year we will make improvements. That is as much as I can honestly say to you. But I can assure you of a single-minded attempt to improve participation. And everything I say reflects that.
MR. ABDEL-LATIF: Other questions?
QUESTION: Good morning. Antonio Tricarico [ph.], Reform of the World Bank Italy. On behalf of Tobanka Lumu [ph.] from Lesotho currently blocking South Africa by Czech authorities who haven't released his visa to come to Prague and present this joint report.
President Wolfensohn, in 1996 you pledged to fight the cancer of corruption worldwide and committed to depart from any World Bank funded project for a certain time period all those companies contracted under World Bank projects and found guilty of corruption. As you know, the World Bank funded since 1988 the Lesotho Islands Water Project. Since 1997, Lesotho, South African and Swiss magistrates have investigated allegations that twelve multi-national companies contracted under the project bribed a former CEO of the project implementing agency.
In 1998, notwithstanding these investigations, the World Bank approved a new loan for the second phase of the project totalling $45 million US. I have three questions for you on this case.
One, in compliance with the World Bank Anti-Corruption Guidelines, will you commit now to debar the twelve multi-national companies currently on trial in Lesotho in the event that they are found guilty of corruption by Lesotho magistrates?
Second, in order to better clarify the role of the Bank in such controversial project and establish credibility for the institution you lead among Lesotho NGOs and locally-affected communities, will you commit now to open an external independent investigation on the eventual responsibilities of World Bank and implementing agency officials in the case?
Third, what measure can you take to exert a stronger control on implementing agencies during project implementation in the field?
We are asking these questions because we fear that the Bank's corruption policy may run the risk of becoming a don't-ask/don't-tell policy. Thank you very much.
MR. ABDEL-LATIF: Anyone else on the corruption issue?
QUESTION: [Interpreted from Spanish.] Good morning. Juan Carlos Nunez is my name. I am speaking on behalf of the Bolivian Episcopal Conference. I represent a movement of the Jubilee 2000 Forum which was held in Bolivia this year on the theme of the foreign debt relief.
Can you hear me, Mr. Wolfensohn? Channel 4 is English. So, I will sum up. Juan Carlos Nunez, Jubilee 2000 Bolivia.
On the topic of corruption and access to information as well, I would also like to refer to that first topic that you discussed earlier, as a result of a whole process of consultation with civil society in Bolivia and in developing a participatory plan to combat poverty and at the end of this long participatory process we feel that there is not comprehensive information as to how this plan is being drawn up after these consultations with the civil society. We still do not have information that allows us to participate fully in the design of a plan, using indicators, et cetera.
Our major question is: What is the baseline information that the government uses in developing this plan? And I think there are different versions and different aims. When we talk about fighting poverty, we are referring to reforming the economic structures of the country. We believe that is necessary. We don't think that fighting poverty is a case-to-case fight. And that is not only in Bolivia.
The Bolivian society has had to question the structure of the nation. The Bolivian Government has only been focusing on how to solve poverty problems, and there are two totally different issues. I wanted to ask you: What is the Bank's position on these two topics?
The other topic which I want to refer to is corruption. For us the best weapon in order to combat corruption is social checks and balances. The Bolivian social society has come up with a concrete proposal, how to establish a social control mechanism which should be inherent to the plan to fight poverty. This is how we can actively participate in controlling and monitoring the investment of resources.
My question is: What is the extent of the political will of international organizations to go along with the civil society? Are they going to continue dealing directly with governments in which one of the most critical element that stands in the way of these plans is corruption? Or will true spaces for participation of civil society have to be created, including access to resources and in this case on monitoring and control mechanisms that would be guaranteed a form of financing so that they can perform this role? Thank you.
MR. WOLFENSOHN: Let me deal head-on with the question of corruption and then let me come back to this additional issue which is the issue of consultation and political will, which I think pervades both a lot of the discussions and a lot of the misunderstandings that exist between the Bank and civil society.
Let me say first-off that until three years ago, the word "corruption" was never mentioned at the World Bank. As some of you may know, the true story that when I got to the Bank, General Counsel called me in to give me my briefing on what I could do and what I could not do as President of the Bank. And he said the one thing you cannot do is to talk about the "c" world. And I said what is the "c" word? He said the "c" word is corruption. And under the charter of the Bank you are not allowed to talk about politics and corruption is politics. Therefore, don't talk about the "c" word. You can talk about anything else. You can talk about social justice, you can talk about poverty, but for God's sakes don't talk about the "c" word because you will get fired. Your shareholders won't like it.
And that is not an allegorical story. That is, in fact, a true story. I took this for about two years until I recognized that there was no way to deal with the issue of equity and poverty and development without tackling the question of corruption. So, I came out in my Annual Meeting speech, I said corruption is a cancer and it is not political but it is social and it is economic and, therefore, I am allowed to talk about it. And if you politicians think that it is political, that is your problem. I think it is social and economic. Therefore, I can talk about it.
Well, six months later the Development Committee had as the central item on the agenda corruption. And every Minister spoke about corruption. It didn't matter what country they came from, even some I might say that people might think are corruption, they all made speeches about the evil of corruption. And the debate really started.
As some minor point, I would like to point out to you that the whole debate on corruption at the official level started about three years ago, and since then they may have been working in about 89 countries, 600 projects. And they are all designed with one thing in mind. It is that we cannot come in with a big stick and stop corruption. That is very clear. The only way that corruption can be stopped in my opinion is to have transparency, to have public oversight, to have a debate going inside the countries. It is inside the countries that you get the power to combat corruption. It is a political force inside. My coming to a rich dictator and saying don't be corrupt doesn't cut a hell of a lot of ice. What cuts a lot of ice is that if the people rise up and throw him out, or if there are changes generated internally.
So that everything that we are doing is designed essentially to bring transparency to local process so that we can get a local debate going on corruption. That is I think moving pretty damn well. It is not by any means complete. And here, I would make just one point which is that you cannot expect to change these things overnight. Corruption, for example, in Russia has been around since the time of the czars. And it is not very easy even for President Putin to come in and say tomorrow everybody is going to go clean. It is not the way the world works, but what can be done is to set up frameworks in which you could have clarity.
Now so far as the Bank is concerned, we have set up a really tight and large unit to look inside the Bank to see if there is any corruption in a way that there has really never been before and to look at projects. And we have already put 48 companies on a black list. That is 48 more than we had five years ago. And those investigations are proceeding and will continue to proceed and they will in the case of Lesotho.
The Lesotho issue is still before the courts, as you know. There is no decision in the Lesotho case. But if World Bank funds have been misappropriated, then we will undoubtedly black list the companies that have misappropriated World Bank funds.
What we have to do is to get a judicial decision on the issue. We cannot anticipate it, but we can follow it and I can assure you that we will be doing that and that there has been no fractional move away from the policy that, if there has been corruption in a World Bank project, that we will blacklist the company that is concerned. So, I can give you a direct and straight answer on what will happen but we have to await the results of the judicial process which is ongoing.
And by the way, we have been cooperating and supporting the judicial process. So the notion that we're staying on the sidelines is, I don't think, fair. See what happens when the process emerges, and if there are things that we haven't done that we should do, get a visa to come to the States or send me an email, and I'll be glad to address it.
Now, on the question of Bolivia, what you say to me is, while not surprising, sad, because the first Comprehensive Framework that we really worked on has been with Bolivia, and the Vice President of your country has himself taken the lead in terms of the consultative process. I have met with him probably half a dozen times in terms of his outreach to Bolivian NGOs, and I have an office there--y director, who was in Washington, has gone to live in Bolivia so they can work and be part of the process--and the reports which I have been getting, which seem to differ from what you are telling me, are that the extent of consultation is really considerable in your country. I know that meetings have taken place. I know that on the face of it, both your Government and our people are telling me that the consultation process has developed very strongly, and in fact we are using the Bolivian example as a very good example of how the Comprehensive Development Framework is working.
So what I suggest you do if it is not is to write to me directly or see our local representative and go along and discuss how it can be improved. Certainly the Vice President, who I guess is one of the more popular people in your country, is of the opinion that he has reached out and embraced civil society. Six months ago, he made that public statement in Washington, and in fact within two days' time, there was a meeting on the Comprehensive Framework, and a Bolivian public official will be reporting on this. So if there is a disjunction between what they are saying and what my people think and what you feel, I think the best thing to do is to let us know where it is falling apart, and we'll be glad to address it.
The other point which you made, which was the point about poverty or the political structure, is something on which there is great difficulty for the Bank that I hope you'll all understand. We are owned by the governments. The people I report to and who own the institution are in fact the finance ministers. That's why I come to these meetings. We have a legal responsibility to work through governments. The government people say, many of them: Look, we are the elected representatives. We are a democracy. We are elected. It is not for you, the Bank, to come in and select people around the country to tell you what we Bolivians want. It is for you to deal with us because we are elected.
And that is rational. What we are trying to do in as oblique way as we can is to convince the governments that you cannot impose development on communities or groups of people, that what you need to do is to consult so that they could own the process and that we don't design something in Washington or La Paz, but that it includes the people.
We could do that on projects, and I can say as I said yesterday that I think the problem of Latin America is the problem of inequity and social justice, which I happen to believe, but I can't intrude on the political process in Bolivia. That's for you to do. It is not for me to do.
I can be there to be helpful in terms of projects, but I'd get my head handed to me if in every country I go in and try to decide what the politics should be in that country.
So I think you should understand that there are limits to what we can do. We are an agency that gives support; we are not an agency that governs every country that we operate in. And I am afraid that's up to the Bolivians. You have to sort that out and get in power the government that you want.
What I have to do is to deal with the governments in as best way I can and to reach out to those sectors of the society that can be helpful.
So I think you put your finger on a very important issue, but it is a limit in terms of what the Bank is able to do, and very often, people blame us for the politics of a country when in fact they should be blaming themselves. It is not me who has the vote in Bolivia. It is you and your colleagues. And I can try to be helpful, but if you have the wrong government, then it is you who should be doing something about it, not me.
MR. ABDEL-LATIF: For saving time and to give people a chance, I will take a series of questions now. Yes, please.
QUESTION: Mr. Wolfensohn, I am Ricardo Navarra, and I am the Chairman of Friends of the Earth International. We are a federation of national environmental groups in 68 countries around the world, more than one million people in membership.
We would like to bring your attention to the problems associated with the extractive industries, namely, oil, gas, and mining investments. These projects are generally associated with serious environmental and social problems, including increasing biodiversity and forest losses, endangered indigenous populations, exacerbating the problems of global climate change, human rights abuses, and impoverishing rather than enriching communities.
One only needs to look at the situation of oil and mineral extraction in Nigeria, Angola, Indonesia, or Colombia, for example, to see these problems.
Furthermore, there is no real evidence that investment in fossil fuels and mining substantially enhances GDP for most developing countries. In fact, some economists, including Jeffrey Sachs, have pointed out that countries with abundant natural resources tend to grow less rapidly than those countries without natural resources.
For this reason, there is growing concern about the World Bank Group's investments in these projects which between 1995 and 1999 amounted to nearly US$6 billion. This US$6 billion could be used for investments in renewable energy and other projects that more directly benefit the poor.
In April, 200 NGOs from 55 countries issued a call to the World Bank to phase out the financing of these projects. Today, Friends of the Earth International calls on you to commit to an immediate ban of these investments in ecologically important areas and areas of high conservation value and to develop a plan to phase out of financing new exploration of oil, gas, and mining projects in the next five years.
Of course, there is room for exceptions such as supporting gas as a replacement fuel for coal and nuclear, or small-scale community-based mining, or financing mine closures. But by phasing out financing for these harmful projects, the World Bank would be making real progress toward poverty alleviation and environmental protection.
Will you support this cause, Mr. Wolfensohn; and I would like to give you the position papers we have on these cases, if you would allow me. Thank you, sir.
MR. WOLFENSOHN: Thank you. If you could introduce yourself so I'll know where you are from.
QUESTION: My name is Kais Gopal [ph.], and I am coming from India. Mr. President, I fully endorse that you are making efforts to reduce corruption. You said "If there is a problem, please write to me." Let me tell you with all my humility that that is what my own leaders, who are corrupt, would also say. They would say, "Write to me." That is not the way in which it can be handled. Every project director is also telling us.
The point I'm saying is that grievance handling within the Bank cannot be addressed as part of its own hierarchy. It has to rest elsewhere. Otherwise, you are asking me to talk to my own project leader, to talk to my own country director, who himself could be a part of anything.
I think this is a matter--you don't even have an ombudsman. You have gone through an independent panel when it comes to major issues of ecology, but on corruption, if you don't have it outside your system but within your system, and within a hierarchical system, I don't think it will work in the Bank--and sending emails to you, sir, is as bad as sending it to my own corrupt leaders. So I think there is a need for you to look at that.
Otherwise, consultations with civil society on matters of corruption would have no teeth, would have no meaning, no commitment, no genuinity [ph.] on the side of the Bank. Otherwise, we get thrown between the Bank blaming the government and the government blaming the Bank.
So I don't think your answer is clearly solving the problem; it is only saying look at it at the political level. I think it is possible at the systemic level also. You have to put some fear into the system to be able to be accountable.
Having said that, the second question I have very quickly, sir: Reforms in macroeconomic policies and delivery institutions is also seen as the basis for development and poverty reduction by the Bank, and knowledge is, as you say, and supervision are seen as the key instruments in enabling this. But if you see the content and commitment of the reform package and its effective implementation, while those dealing with the opening of markets and enabling framework for private sector is happening very, very clearly--I come from Andhra Pradesh, sir, and I have seen your power sector reforms, the commitment and the thought that has gone into implementing it--but when it comes to the forestry sector or poverty alleviation sector, that commitment in the Bank staff itself is totally lacking.
So why does this duality exist between those which have to do with development and have a certain way of doing things within the Bank and in regard to reforms; but when to comes to those dealing with social processes, enabling processes for the poor to gain income access, a very soft option is being taken. Thank you.
MR. ABDEL-LATIF: Let me take a third question.
QUESTION: Mr. President, my name is Adil Vyselov [ph.], and I represent 172 NGOs of the Kyrgyz Republic united in the Coalition for Democracy and Civil Society.
I would like to make a point supporting my colleague from Bolivia, which is also a CDF pilot country. Kyrgyzstan is one of the 13 pilot countries.
While you answered our concerns that it is your own country, and you should deal with your own government and build civil society, we would like to call on your leadership, that you encourage governments to be more inclusive. We think that the World Bank does have a great role in making this world more democratic and inclusive, because in Kyrgyzstan, the government excluded opposition political parties from the process and thereby undermined long-term sustainability; it failed to build national consensus, and we think it failed. And now, back in my home countries and NGOs from around the world, they are worried that the very good idea of CDF, which we whole-heartedly support and welcome, could become another good idea which will be abused and justify the old, wrong ways of doing things.
So we have a very specific question here. Can you, Mr. President, develop criteria so that the World Bank does not recognize and applaud CDF processes which are not inclusive and democratic? Thank you.
MR. WOLFENSOHN: Thank you very much. They are very, very good questions, all of them. Let me start with a point of clarification. Writing to me may not be as bad as writing to some other people, because I do have an independent group that deals with corruption. It is not in the line. They report directly to me. They have secure offices. They operate outside the line.
We have a hotline that you can call where you can give information and call on us for exploration of any aspect of corruption that you want. It is run by an outside firm that is totally secure. We did a study of how best to do this. I think we've got a state-of-the-art system now, and I have a team of people who work on this who have nothing to do with anybody who is on the line. In fact, some people in the Bank would say that I have the sort of force that I am trying to get rid of in some countries in terms of its independence and its ability to review anything. So let me put your mind at rest--you have a totally independent group, and if you wrote to me, I would not be going back to the line manager, I would be going to that team, and it runs separately and independently. If it were as you described, it wouldn't work, but it is not as you described, and it does work. So that is the first thing.
Let me come back to the issue of the Friends of the Earth and then go through the questions. The issue of oil, gas, and mining is a very difficult one for me and for us. We have on the one hand the ecological and the issues of indigenous people. We have all the things that I am as aware of as you, of the horror stories of some of the projects. But we have at the same time in some countries the issue that these projects may be the only thing that they have in terms of generating income.
Let me take the specific case of Chad-Cameroon in which your organization was particularly active, because for me, it reflects most if not all of the issues that you address. Here is the case of a country that has nothing in terms of income-producing potentiality except an oil field which was found 35 years ago, and where it is the second-poorest country in the world, and where the Government was keen to try to see this oil extracted, and where we were confronted with do you want to be part of something that will develop a $2 billion cash flow, with Transparency International saying the Government is corrupt in Chad and in Cameroon, and if you generate the money, it's going to get lost, and what about the indigenous people who will be affected, and what about the environment that will be affected.
We did what I think was--and time will tell--a pretty remarkable job in terms of trying to address those issues. We did 48 studies on the environment, and we came up with a route which, at least in my opinion and in the opinion of, I think, many environmentalists, is the soundest route that you could have. We have arranged with both the Chadian and Cameroonian Governments that the money will go into a transparent trust fund; that representatives of the Government, the opposition, civil society, and the Supreme Court will be on the distributing body that deals with it. We have arranged for the relocation and for the reinforcement of the societies of the indigenous people.
Now, there is a difference of view, I think, between Friends of the Earth and the Government and many of the people of Chad and many of the people of Cameroon on whether we went far enough, and they are saying this is going to be another Nigeria, it is going to be another something else, they are a bunch of criminals, and the thing is not going to work.
I am in the difficult position that I know that if I'm there, and they take this out, I can do everything possible to protect the environment, the indigenous people, transparency, and the use of the funding. I know that if I am not there, there is an alternative way that they can develop that project in which there will be no supervision. That is the dilemma I am in. And to be honest with you, having really followed the case of Chad-Cameroon extensively--in fact, if I had not wanted to, surely your organization and others would have brought it to my attention, which you did--I actually believe the Chad-Cameroon pipeline is a very sound thing to be done, and it is breaking new ground on how you deal with extractive industry.
What I am prepared to do is to do with you in a way that I think we should explore what I have done on dams. On dams, we have had an international and balanced Commission on Dams to take a look--and they will be reporting in a few months' time--on whether we've got it wrong or whether we've got it right on dams, and what it is we should do and what it is we shouldn't do. I would be perfectly happy to sit down with you and with your colleagues to try to see if there is some mechanism that we can stand back and take a look at the actualities of this extractive industry, the pros, the cons, the pluses, the minuses, and see if together we can come up with something that will either lead to an exclusion or to an inclusion on certain terms of what we are doing.
If you are prepared to sit down and discuss it, I am very happy to do that. I'll set up a team, and we'll try to decide how it can be done in the most effective way. I can talk to my colleagues in the NGO liaison group. I am prepared today to commit to you that we'll take a look with you at what the arguments are and to take a thorough look at what are the pluses and minuses. You can even get Jeffrey Sachs to come and give his views on the subject if you'd like, so that is the major concession I'll give you in relation to it, and that's because I've been drinking.
But I'm glad to do it. So why don't we take it that we should sit down when this meeting is over, take a look at what I think are legitimate questions that you're asking and see if there's some way that we can focus in on that subject and reach whatever conclusions we reach? So I'd be glad to take that up with you subsequent to the meeting.
The last thing that I'd like to make on Kyrgyzstan, you came up with a question of forestry and social resources. I can quote you projects in India because I've seen them, on forestry and on social programs. In fact I've been out to many areas, including Andhra Pradesh where you have a pretty active prime minister yourself, where groups of women are coming together to protect the forest, where we're supporting them, where on social programs they're broad and deep and community involvement.
So I don't think we get it right every time. Don't think that I'm protesting that everything we do is perfect. But in India, of all the countries, the social programs that we're bringing in are very extensive. Now if there are cases where some of our people have come in on something and not taken account of it, again, talk to our people. We will not get it 100 percent right, nor I guess will any NGO, dare I say that in this company. But it is possible that there's human fallibility.
I'm very happy if you come up with these issues. There was a time when we didn't respond to NGO letters. That is not true today. We now take seriously what you tell us. So why don't you, if you've got a particular thing in mind, particularly if it's in Andhra, let us know and we'll deal with it.
On Kyrgyzstan, let me just make one point again which follows on the Bolivian point. If you go back 10 years in Kyrgyzstan, you didn't have NGOs. You didn't have any voice in the part of civil society. That you know better than I because you live there. The idea of the CDF is to encourage the Kyrgyz government to try and have consultation, to which they're not used. Under the former Soviet system people didn't go out and get a poll of what people were thinking. Not from non-elected officials, not from anybody. So to establish a CDF pilot in Kyrgyzstan at all was something that I think was a pretty useful first step.
What I suggest we do together is now try and move forward, and what we are doing ourselves is to try and keep pushing people to say, don't just listen to your friends. If you're going to make this an effective process you have to listen to some critics as well.
But what I don't want to do is to break the process before I have the governments committed to the idea of consultation. It takes a while. And in the former Soviet Union it takes a little bit longer because there simply has not been any history, any history of consultation. The fact that you have any form of consultation in the Kyrgyz Republic already puts you in advance of a lot of other states that are now existing.
So I don't believe we've reached the end of the road with the Kyrgyz Republic or the CDF. Just let us push and push and try and engage a broader section, and over time I think you'll have perhaps a changed culture. But you're not going to change apparatiks overnight. They are used to dealing in one way and to suggest to them that because we have a process their instincts are going to change is not reality.
What we have to do is to keep moving forward in a progressive manner, and I believe in five years time you'll look back on the CDF in Kyrgyz Republic and say, that was a good start and we're a hell of a lot further ahead than we were then. And you can take it that we will continue to be trying to expand it because the process of consultation has to be broad, otherwise it's not meaningful. I think that you should proud that you have it at all and we will keep pushing with you to try and expand the range of consultation.
MR. ABDEL-LATIF: I think we are the last seven, 10 minutes. Let me take the last round of questions. Back there, back row.
QUESTION: Thank you for this opportunity. My name is Argentina Matavelle [ph.] and I work for World Vision in Mozambique. I also bring the views of a coalition of NGOs that meet around the issue of debt.
We have a few concerns. We do acknowledge the fact that the Bank has tried hard and really is doing a good job at trying to come to the people, to civil society consultations, but we feel that these consultations, at least in the case of Mozambique, are being done in a rather rushed manner. The country is a long country and issues tend to be concentrated in Maputo. Mr. Wolfensohn, you visited the country and you know very well how it is. We're not given enough time to really discuss and consult with the populations in further provinces north.
In the case of the recent discussions for the PRSPs, for example, we felt that the consultation process was very rushed. And most times what you just rightly said, you said your mandate is to speak with government; the governments will always blame the World Bank for certain issues. So we want to suggest a few, three ways in which we believe this participation of the people could be done.
One, we think that there should be monitoring mechanisms by civil society for the use of funds in poverty alleviation. We think that NGOs and other agents of civil society should participate in the evaluation of selected projects by the Bank and issuing revisions, if needed, following the recommendations of these evaluations.
Further, we want to suggest something which would be something like a vision but which is achievable, because when you started in '94 you had a vision that many people was believed was impossible but it's happening now. We would like to suggest that conditionalities be reversed. We want conditionalities by the civil society for governments to be able to borrow. So it means that for every loan the government would come to the Bank, the Bank would have to see that civil society has endorsed this loan.
World Vision will be launching a report on the PRSPs on Tuesday so further ideas will be contained therein. I will pass on to my colleague from World Vision Uganda.
MR. ABDEL-LATIF: Thank you. Please be brief.
QUESTION: I will. Thank you very much. I will try to be brief. My name is Moses Dombo [ph.] from World Vision and I work in Uganda.
I'll ask two little questions. The first question is on commitment. Dr. Wolfensohn just talked about how he was given a mandate and he was asked not to talk politics when he took responsibility. My question was, can you separate politics from development? Can you talk development without talking politics?
Secondly is on the whole issue of commitment. I'm looking at HIV-AIDS and how this monster is ravaging Africa. At the World Bank you're on record, Mr. Wolfensohn, as having said $500 million can be found for dealing with the issue. We have been told that what's actually needed is about $3 billion annually. Are we dilly-dallying with the very problem that is likely to destroy everything else that we have invested our resources into? Is there really a commitment to deal with the issue of HIV-AIDS on the side of the Bank?
And lastly is about the piecemeal approaches. We know what really works out there. We're dealing with only pieces of the real thing when we know what we should be dealing with as far as poverty is concerned.
I could lastly mention the issue of globalization and privatization. We're asking countries to privatize everything, and countries have sold off all the assets that they had. Countries have remained without assets that they own as nations. Can we have countries, governments which own nothing and then we ask them to pay back loans which they take? Thank you very much.
QUESTION: [Interpreted from French.] If I may, I'd like to speak French. My name is Anne Christine Abar [ph.] from the International Federation of Human Rights based in Paris.
You've been talking a great deal about democracy, sir, and the need to have populations perceived as owners of the policies that are being pursued. In many public statements in recent years you stressed, sir, on the need for sound governance, on the need to have an independent judiciary, on the need to ensure right to information and having transparent information.
So gradually one gets the impression that over the years the World Bank is underscoring the various elements of the rule of law. Increasingly you've said that there has to be minimal respect for human rights for some policies to be successful. And needless to say, we agree 100 percent with you and we're delighted to see this development in the Bank's policy that policies can only be successful to the extent that there's proper respect for human rights.
However, at no time in any of the public documents does the Bank refer to the International Human Rights Instrument, an essential component of a body of recognized law, not to mention the fact that all of these instruments have been ratified by your member states, your shareholders. So why is it that these international instruments are never explicitly referred to by the Bank in its official documents, and why doesn't the Bank choose to pledge commitment to these instruments? It would be one way of imposing upon yourself goals that could not be challenged by anyone.
QUESTION: [Inaudible] I would like to get back to this unfortunate case with accreditation as an example. You talk about talking with civil society and more open process. That's the theory. Then we come here and many people who applied, three, four, five months ago they are still not accredited. That's the practice.
I think all these questions, all what we heard here from the NGO side is a sign that we do acknowledge that under your presidency the Bank is talking more and more about issues which were not talked about. I would like to hear about your plan to put this theory into practice. Thank you.
MR. ABDEL-LATIF: Thank you.
MR. WOLFENSOHN: Let me just touch on the accreditation issue. I first heard about the accreditation issue last night. I have heretofore not been aware that there was a problem with accreditation. You can blame me for not having looked at the details, and you have every right to do that. But I was told that there were 350 NGOs coming here, that the accreditation system was such that it was working. I learned yesterday that 25 NGOs had not been cleared and we put in an emergency procedure that they should be cleared for today with day passes so that the executive directors of their countries could approve it.
I can assure you that the intent was there on accreditation and I'll make sure that we expand it as much as we can. But since last night when I first heard about the accreditation issue, I have to say to you that I'm very sorry if there have been glitches. Certainly it was not a matter of policy. I've asked my people to try and fix it, and I hope that in the coming hours they'll be able to do so.
Part of it is that the EDs, the executive directors of the Bank have the responsibility of clearing national NGOs. This gets back to the political process, if you like. Whether the hold-up is there is whether the hold-up is our inefficiency or with the Czech authorities, I simply don't know.
But I would like to comment on the fact that we do have 350 NGOs here that seem to represent a fairly broad range of views. And having heard the questions this morning, they're hardly a select group that all are in favor of the Bank. So I think if 350 of you can't cover the range of criticisms of our institution it's pretty sad. But I do agree with you that we should have had as big a group as possible, and I have asked my colleagues to try and ensure that groups that are not represented should come here.
Let me come back on the question first of the lady from Mozambique and the issue of debt. I don't want to mislead you. I don't think the Board for two minutes will accept the proposition that if they want to borrow from the Bank it has to get not a parliamentary approval but an additional approval from NGOs. That's just not reality. It's not going to happen. I could insist on it till I'm blue in the face and elected prime ministers and governments are not going to change their internal process for me. They simply are not.
What I am trying to do, in all sincerity, is to try and broaden the debate within the context of not interfering with the politics of the country. And I am going pretty damn close to the limit. I am constantly up against the question which your colleague mentioned, how do you separate politics from development. Well, it's very difficult. Because every time you talk about poverty, inclusion, community development, ownership, you're in a way impinging on the political process in the country.
What my ministers are saying upstairs is, I was elected. You're not elected. You're appointed. I'm elected in my country. What right do you have to tell me that if I want to do a project, I have to go consult with a whole lot of people who you don't understand, but they're the opposition. They're radicals. They're against us. They're trying to tear the country down.
I will always be honest with you, I can push this thing to a degree that I think can be very helpful for NGOs. But what I cannot do is to change your political process. It's not in my ability to do it.
I can go to Moslem countries and I can meet with Moslem women, as I do everywhere, to try and talk about giving voice to Moslem women. My wife and I do that. I can do it on the level of consultation. But I can't change the role of Moslem women in the society. Moslem women and men have to do that.
So when you think of the Bank, understand that we're not a world government. We can help. We can push. We can create an environment. We can help you to get greater voice. But in the end, it's you in your own countries which have to make the definitive change.
If I promised you that I could, I would be lying. That is why I think in all candor that there is a need to build a better understanding in partnership. You can knock on us for everything you like, and you do. But think about what are the limits of what it is that we can do as an institution. And that is all I ask you to do.
If I were to tell you that I would be certain that NGOs would be able to approve everything that I was dealing with with governments, I would be lying, because the governments are not going to buy it. What I can do is to set up a framework of discussion, of consultation as far as the governments will let me go. And I happen to believe that community involvement is important. And I will make one point that has not been mentioned today.
With Internet technology and the availability of information exchange, as you have already seen in the way in which manifestations can be organized with someone from their living room with an Internet connection can get information around to cause meetings like this, the possibility of enfranchising civil society and getting transparency and knowledge is as never before -- as never before.
And my objective in terms of Internet technology is not to ignore that people are starving and that they are hungry and that you have to deal with the questions of sustenance and poverty, but the biggest challenge and the biggest opportunity that you have is frankly networking and transparency using technology.
All of you may not agree with today, but I promise you in five years you will. We will be able to get to every village in five years with Internet technology. In the work that we have done with poor communities, we just had a meeting ten days ago with 35 groups representing the 60,000 we did in Voices of the Poor. Item number one on their agenda was technology, was transparency, not on my agenda but on their agenda. And I think that the thing that is going to make the difference in terms of involvement is going to be transparency and technology and come back in two years and you say you heard this lunatic talking about it today.
It is going to change the nature of that process. And I urge you that we can work on it. Having said that, let me say that on the question of HIV/AIDS, the 500 million that we talked about in Uganda -- and, by the way, we have worked in Uganda for many years on the question of HIV/AIDS -- what I said six months ago was that no HIV/AIDS project will go unfunded. I have said if the Bank runs out of money, I will try and get it elsewhere. And the first $500 million we put up last week as part of a new program -- we have already spent $1 billion on HIV/AIDS.
I will say again today what I said six months ago, the issue of HIV/AIDS is not a monetary issue. The issue of HIV/AIDS is not an issue just for the Bank. It is an issue for local governance and local government and commitment to come up with programs to talk about the sort of things that in many cultures people don't talk about. That is the problem that we are finding in countries. It is to get leadership to grasp the issue of HIV/AIDS. And with 23 million cases in Africa, with 10 million orphans, it is now not just a health issue, but it is an absolutely fundamental development issue. And it is not just limited to Africa.
In South Asia we have problems. In the former Soviet Union we are having problems. It is the critical issue of the day in terms of a health issue. And you can take it that I have been engaged on the HIV/AIDS question for twenty-five years. I am vigorously engaged on it today, and I put out the challenge again that if we have projects for prevention, for mother/child prevention and for programs of asserting in communities to try and stop AIDS, we will be there to finance it and, if not, we will get other people to do it.
You have a separate and highly difficult issue on the issue of treatment because there is no effective economic treatment today that costs less $10,000 a year. We have now negotiated with the drug companies to cut it back to $1,000 a year. That will cover maybe 200,000 people in Africa out of 23 million sufferers who could afford it.
So the issue is to try and come up with a vaccine and to try and come up with other treatments that we could have so that we could have some humane treatments for the 23 million people that now have AIDS. And that is a hell of a problem and a huge problem that we need to address. But please understand that on the question of AIDS I am committed.
And finally, on the issue of the rights of man and on the judicial system. It allows me to say something more broadly in terms of my view of development. I think too often all of us look at development in segments, whether it be in environment, or whether it be in health or in education or in income-producing projects or in microcredit. And what I have learned in five-and-a-half years is that development is first a very complex process. Secondly, it takes time. It does not happen overnight. You need consistent commitment. You need partnership between the community to try and bring it about. You need to have a real understanding that you are changing cultures. The world is an inequitable place.
You have 80 percent of the world having 20 percent of the income and in countries you have the rich and you have the poor and the people in power and the people who have no voice. That is what you are starting to change. And my opinion is that the way to start on it is to get the structures right. You have to protect people's rights. You have to have a legal system that works. You have to have honest judges. You have to have a financial system that gives openness to people and not just a few. You have to fight corruption. You have to get well-paid governance and people who will occupy themselves with government activities without being corrupt and being fair, because corruption, in fact, hurts the poor more than it hurts the rich.
I haven't yet talked about education and health and agricultural policy and urban policy and environmental policy and cultural policy. I am talking about getting the basics down. And in my opinion, there is no way to have equitable development unless you deal with the justice, legal and the structures that are in place. Unless you have that, you cannot have equitable development.
And in that context, I don't know why we don't mention human rights. I have got Mary Robinson coming here to talk about human rights. I am a great believer in human rights. I will look at our material to find out why we are not using the word "human rights" and next time you come I assure you that I will have a reference to human rights.
But everything I talk about relates to rights. Unless you have property rights, unless you have individual rights, unless you have a sense of equity, you cannot attack the question of poverty. You just cannot. So, I am linked with Mary Robinson, I tell you, and I will make sure that our literature reflects it, if it doesn't.
I know that today's meeting is just a start. I would like to make one plea to you. I have 10,000 people that I work with. They come from 150 countries. We have more than 1,000 Africans. These are not all evil people. They do not get up everyday to say how can we screw the poor, how can we ravage the environment, how can we diminish the role of women, how can we effectively install corrupt governments. It is not that sort of a group. We will screw up from time to time. I have absolutely no doubt. We will have some bad people. We will have some difficult people. We will have some people who hate you, that will never talk to NGOs. But we have a growing number of people who recognize a new culture. And that is that the Bank cannot do it alone, that we need a dialogue and that we have got to work together.
My being here is an indication that I am ready to do this. I will continue to do it; my colleagues will continue to do it. And I very much hope that at this meeting and at subsequent meetings we can continue to push along this dialogue. We will follow-up on the things that I have agreed to follow-up on, and I hope that over time we can build a sense of mutual confidence that will allow us all to do the thing that we want to do, which I guess is to make the world a better place.
Thank you very much for coming.
MR. ABDEL-LATIF: Thank you.
[Applause.]
MR. ABDEL-LATIF: Just before we close, two announcements. There will be a discussion on public policy disclosure of the Bank next Thursday. The paper is available, and there will be a discussion on the PRSP tomorrow.
And on behalf of all of us, thank you, Mr. Wolfensohn.
[Whereupon, at 10:57 a.m., the meeting was concluded.]
More Information on NGOs and Bretton Woods Institutions
