September 26, 2000
Prague - China on Monday sharply criticized the World Bank, accusing it of meddling in the internal affairs of some members and bowing to political pressures exerted by others. Chinese Finance Minister Xiang Huaicheng, addressing the World Bank policymaking body here, also slammed the Washington-based lending institution for imposing high costs on its borrowers.
Xiang charged that the Bank had become "increasingly involved in internal political affairs of its member countries" and insisted that governance and institutional reform were matters that concerned national authorities rather than the World Bank. "In its decision making," he told the Development Committee, "the Bank tends to give way more and more to the pressures from some shareholders and politically motivated NGOs (non-governmental organizations) but responds less and less to the concerns and legitimate interests of developing countries."
He referred specifically to the Western Poverty Reduction Project. The World Bank executive board last July refused to endorse the institution's participation in one aspect of the scheme, a program to re-settle 57,000 Chinese people from barren farmlands to traditionally Tibetan lands in Qinghai province. Critics of the plan insisted it would suffocate Tibetan culture there in a wave of destructive migration.
But China blamed objections from the United States and Japan, which it accused of raising "unreasonable demands and (erecting) all sorts of obstacles for political reasons." Xiang also faulted the Bank for failing to address the concrete needs of its members, preferring instead to saddle them with "over-sophisticated but often ineffective institutional assessments, diagnosis and consultation."
The Chinese minister complained that the cost of doing business with the Bank had risen considerably, with borrowing countries having to pay for safeguard guarantees, assessments and loan charges. "The high cost of doing business has restricted the Bank's ability in helping developing countries," he said.
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