By Alex Wilks
BONDOctober 2002
Now that the World Bank and IMF have extended their mandates into most development policy areas their annual meetings are inevitably very confused. Particularly as the threat of protests had curtailed the meetings and the range of possible venues, many of the ministers, officials, company representatives and activists found it hard to know which meeting to attend at any time. The official discussions were dominated by the need to measure development results, the state of the world economy and a new debt arbitration mechanism. Civil society groups also raised trade, services privatization, HIPC debt, Poverty Reduction Strategy Papers and a number of controversial World Bank projects. This short article contains just a snapshot of some of the issues raised.
James Wolfensohn, the World Bank President argued that the international community has decided what it wants to happen and now the challenge is merely "implementation". This sentiment was echoed by Clare Short, the British Governor of the World Bank, in her remarks to the Development Committee - the body which meets twice a year to give strategic direction to the Bank. The Committee welcomed the agreements made at Monterrey and Johannesburg and discussed ways to implement them with a focus on monitorable results.
Renewed focus on trade
The Development Committee "welcomed the increased attention to trade issues in the work of the World Bank and IMF and urged intensified efforts to mainstream trade in the development dialogue with the Bank's members". Many NGOs were concerned, however, that the Bank and Fund were uncritically endorsing WTO trade liberalisation. These fears appeared to be confirmed when Uri Dadush the new head of the World Bank's Trade Division said that, on average, trade leads to growth and growth to poverty reduction, and that both developing and developed countries benefit from unilateral liberalisation.
Dadush's comments were contradicted by Bank President James Wolfensohn in a public Roundtable meeting, held in a US television chat show format. Roberto Bissio, of Social Watch in Uruguay, told the panel that the Bank and Fund's pressure on developing countries to liberalise was hurting their bargaining positions in WTO negotiations. Wolfensohn cut in, insisting that this was no longer the position of the Bank but Bissio said he had heard this from Bank staff just hours earlier. Wolfensohn then quipped "give me their name and I'll fire them... send them over to work for the Fund" insisting that the "song book that the Bank is playing from" was that trade liberalization was a two-way street.
Because of the renewed importance of trade in the agendas of the World Bank and IMF civil society analysts and activists working on trade also held strategy discussions with those working on the World Bank and IMF to see how they could work more closely together. This work looks likely to focus on services issues - ie. private delivery of water, health, education etc as well as on agriculture and trade capacity building.
Debt and poverty strategies
Little progress was made on either HIPC or PRSPs. A number of ministers recognised the problem that commodity price falls had erased the apparent benefits of HIPC debt relief and urged donor countries to contribute more money to the HIPC Trust Fund.
On PRSPs, ministers considered the new paper by World Bank and IMF officials on progress in implementation. A conference held jointly by the World Bank and World Vision attracted a wide range of civil society organisations and officials from many countries. Views, as ever, were mixed. Some saw the proverbial glass as half full - PRSPs have opened space for different kinds of engagement in policy-making in country, while others complained that the macroeconomic policies remain the same as under orthodox structural adjustment.
Poverty and Social Impact Assessment (PSIA) is the latest buzzphrase in the poverty reduction lexicon. It refers to the need to openly deliberate on alternative policy choices rather than technocratically decide that one particular approach is the only one that can be adopted. The questions of who will produce the possible policy approaches and who will decide on them remain open. Clare Short insisted, as have many NGOs including the Bretton Woods Project, that "PSIA is crucial to ensuring that major reforms to be undertaken will benefit stakeholders and achieve real poverty reduction. It is critically important that the Bank and Fund undertake these analyses in a way that not only builds national capacity for PSIA, but also actively transfers ownership of the analytic agenda underpinning major reform policies to national stakeholders".
Human rights: a long journey
NGOs were disappointed that Wolfensohn's May 2002 push to get the World Bank to talk more openly about supporting a rights-based approach to development seemed to have got stuck in internal Bank politicking. The Bank's representative at a meeting sponsored by a range of organisations to debate this said that the Bank was at the start of "a long intellectual journey" to consider what rights it can support and how. He could give no details on what forms of transport this journey would take or when might be its estimated time of arrival. Wolfensohn told an open meeting that his staff were addressing individual rights but without using the language of rights, as this can act as a 'red flag' to some World Bank member governments.
Other issues which were discussed include:
· new approaches to debt arbitration being floated by the IMF;
· a new review of World Bank safeguard policies - the staff guidelines which state how it should deal with issues such as indigenous peoples and environmental impact;
· the education fast track initiative;
· combating money laundering and terrorist financing;
· streamlining IMF conditionality.
Reports on some of these will be carried in the November/December issue of the Bretton Woods Update .
Although they did not feature in the official programme, NGOs discussed the limitations of the sustainability initiative announced by the International Finance Corporation - one of the World Bank Group's private sector arms as well as the arbitration being conducted by another little-known arm of the World Bank on a water privatization deal in Cochabamba, Bolivia. Controversial World Bank projects raised by civil society campaigners included the Rosia Montana gold mine in Romania, the Chad Cameroon oil pipeline, the Baku-Ceyhan oil pipeline backed by a consortium led by BP and the Yanacocha mine in Peru.
The next meetings - to be held in Washington DC in the second week of April, 2003 will discuss, among other issues:
· proposals to increase the voice of Southern countries in World Bank and IMF decision-making;
· Poverty and Social Impact Analysis and Bank/Fund co-ordination on this.
More Information on NGOs
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