World Bank meetings
Smaller nations need bigger voice in IMF, World Bank
By Simran Bose
DUBAI, Sep 24 (IPS) - As the annual meetings of the International
Monetary Fund (IMF) and World Bank came to a close on Wednesday,
officials, delegates and ministers left with the unanimous sentiment
that the developing world must be given a larger role and louder
voice within the two organisations.
In the closing
press conference, World Bank President James Wolfensohn said: ''I
believe that we need to address the questions of linkage between
trade and aid and debt forgiveness and I think we picked up from
Cancun the fact that the voices of the developing and the developed
world need to be more equal.''
address to the Board of Governors of the World Bank Group on Wednesday
and his stress on the need to listen to the needs of the developing
world, especially after the World Trade Organisation meetings in
Cancun, Mexico earlier this month, was hailed by many.
and analysts expressed scepticism at the materialisation of these
goals. ''Why would the developed world surrender its position of
power when there is absolutely nothing in it for them?'' Arun Kumar
Singh, an economic analyst with the Indian newspaper, 'The Hindustan
Times', said in an interview.
and voice at the World Bank and IMF meetings here was relatively
mute compared to its recent high-profile stands at Cancun. The governor
of the Reserve Bank of India, Y.V. Reddy, said he did not really
consider the meeting a success. ''Unlike Cancun, the developed world
was more prepared for the developing world's unity and was able
to postpone the issue of better representation (in the IMF and World
Bank) until next year.''
might look at it as a positive sign that they haven't ruled out
further discussion,'' he added. Currently, rich countries control
more than 60 percent of the votes in the Bretton Woods institutions.
The U.S. government alone has veto power over any radical vote that
requires a super majority.
to a question on whether there had been any progress on the proposals
for changing the right to vote of developing countries in the IMF
and World Bank, the Fund's managing director, Horst Kohler, said
that many governors had made clear that there was a need for more
voice and better representation for developing countries.
''I very much
hope that shareholders from the advanced countries have listened
to their colleagues from the developing countries so that they can
reflect on the position,'' he said.
a political and economic analyst from Lebanon with 'Al-Iktissad
Wal-Aamal' newspaper, said that the only significance of these meetings
was that they were held in the Middle East and the North Africa
region for the first time -- and with the present scenario in Iraq
as a backdrop.
the Middle East is viewed as a region of conflict but the fact that
the meetings came here, the officials were forced to address issues
that are directly related to the region,'' he told IPS. A significant
announcement was made at the meetings regarding Iraq, albeit not
by the two institutions.
The Iraqi Governing
Council, backed by the U.S. administration, announced sweeping economic
reforms to allow total foreign ownership of businesses in the country
without the need for prior approval.
which include tax cuts and trade tariff rollbacks, will apply to
all industries except oil. Oil, of which Iraq has the world's second
largest reserves, will be controlled by the occupying administration.
have quoted Kamel Al-Gailani, finance minister in Iraq's provisional
government, as saying that the moves would open Iraq to free market
competition that would deliver investment, job creation and long-term
But what he
presented as steps forward is causing concern among those who find
these measures out of place at a time when the greatest problems
in Iraq remain basic services for its people, and instability and
violence under U.S. occupation.
''It has taken a lot of people by surprise,'' remarked an Arab journalist,
who did not wish to be named. ''On the one hand, the situation is
so volatile in Iraq right now and such economic reforms would not
be the best option.
But then the
reforms have all the trademarks of a typical programme that is backed
by American self-interest.'' The biggest reconstruction contracts
have already been given to U.S. firms like Bechtel and Halliburton,
which are closely associated with the Bush administration.
in what reveals who is really in charge in Iraq, the heads of both
the IMF and World Bank had nothing to say at Wednesday's briefing
regarding the new economic changes in that country.
include 100 percent foreign ownership in all sectors except natural
resources, direct ownership as well as joint ventures and setting
up branches and full, immediate remittance to the host country of
profits, dividends, interest and royalties.
''We did not
come up with the programme, which seems to me to be something, frankly,
which I have not had a lot of influence on or not a lot of knowledge
about,'' Wolfensohn said.
for a similar response: ''Related to the question of the economic
programme for Iraq, I can only say that I have not seen it.'' But
unlike Cancun, which ended in a deadlock after developing countries
refused to entertain a new round of trade talks, the meetings in
Dubai appeared to acknowledge more the might of the sheer numbers
of the poor and developing nations and the urgency of seeing some
of their expectations heeded by international institutions.
''I did not
sense any great hostility at these meetings. I sensed a willingness
to engage on issues in a very positive sense,'' remarked Wolfensohn.
''That does not mean that people are writing checks immediately,
but I do think that the framework of discussion this time was one
in which people were prepared to address difficult issues together.''