Global Policy Forum

Since the confrontations in Seattle, it is no longer possible to organize a meeting of "globalizing" international financial institutions without the usual lot of protesters turning up to contest the new world order of globalization, reports Le Monde (France, p.I) in a special economics supplement on the annual meetings of the World Bank and the IMF in Prague. For the Bank, spurred by the winds of opposition, the meetings will be an occasion to profess its new commitment to the fight against poverty.

The Bretton Woods twins are seeking new legitimacy in public opinion both in the North and in the South, the story notes, saying that in this respect, the Bank has a long head start. For several years now, it has engaged in a profound questioning of some of its methods, with a view to changing its practices in favor of a more "social" vision. This is evidenced by the presence in its ranks, among the traditional army of macro-economists, of experts in the human sciences. Some 180 sociologists, anthropologists, geographers - compared with only four in 1990 - today work among the 5,500 professionals in the Bank. Well ahead of the IMF - which is belatedly seeking dialogue with the NGOs - the Bank has been trying to listen to civil society. Half of its projects today involve, to varying degrees, a partnership with NGOs.

To humanize globalization and construct a new model of development is the twofold challenge World Bank President James Wolfensohn wants to raise for the institution, says the story. Proof of this includes the gigantic project the Bank has undertaken to listen to the views of 60,000 poor people throughout the world. Yet there will be no renunciation of the free market, says the story.

Meanwhile, former World Bank President Robert McNamara, who in 1973 launched an explicit action plan to fight poverty, says in an interview with Le Monde (France, p.I) that this was necessary because poverty reduction would not happen by itself. Most economists at the time believed growth would be sufficient to lift people out of poverty, like a rising tide that lifts all boats. But this was evidently mistaken, McNamara says, noting that in developing and rich countries alike, there remain pockets of poverty no matter what the pace of economic growth is.

It was important to launch a fight against poverty because the World Bank's mission consists not only of economic development but also human development, says McNamara. Current World Bank President James Wolfensohn has since has taken up the fight against poverty with passion, McNamara says, although he fears Wolfensohn will come up against the weakness of political leaders as he did.

Asked why there has been so little progress in the fight against poverty, McNamara says that while the answer may seem unsatisfactory, his own experience has shown him that it is very difficult to put in place effective policies for fighting poverty. This is due to a frequently overlooked reason: that to give to the poor, it is necessary to take some of a country's wealth and redistribute it, and this idea is often rejected by the majority of the population because they feel penalized. Economic thought, at least in the US, is also dominated by the idea that policies of redistribution are a drag on growth and end up penalizing the whole country. For his part, says McNamara, he believes that important sums can be mobilized to fight poverty without dragging down growth. Indeed, by investing in the poor, by giving them the means to educate themselves, to benefit from technological progress, the whole country is enriched.

The IMF and the World Bank must respond to the criticisms of public opinion, notes McNamara, but he believes the majority are unfounded. The young protesters we saw in Seattle and Washington, and who we will see in Prague, are full of generosity to the countries of the South, but he sincerely believes they are mistaken. It is false to say poverty has increased because of the two institutions, McNamara says, adding that rich countries must increase their development aid and that governments of poor countries must take the necessary steps to fight poverty.