IF-Eye Issue #5

23 May 2006

The latest issue of the IF-Eye newsletter includes updates on IFI and civil society activities, and commentary on the ADB Annual Meetings.

May 24, 2006
A publication of the Bank Information Center

In this issue

1. IFI Developments
2. Civil Society Highlights
3. Wolfowitz Watch: “The Worst Man in the World?”
4. Issue Spotlight: ADB Annual Meetings
5. Book Notes: George Monbiot on Bolivia and Chad, and Allan Meltzer on priorities for the World Bank and IMF
6. Announcements and Resources
7. New at BIC: BIC Latin America Program Manager Eric Holt-Gimenez authors new book: Campesino a Campesino: Voices from Latin America’s Farmer to Farmer Movement for Sustainable Agriculture

• European Bank for Reconstruction and Development: EBRD Annual Meeting and Business Forum. May 21-22. Read more on the EBRD website. Read CEE Bankwatch commentary on the meetings.
• IMF: John Lipsky appointed First Deputy Director of the International Monetary Fund.
  May 18, 2006. Lipsky succeeds outgoing First Deputy Director Anne Kreuger. He has previously served as Chief Economist at JPMorgan and Salomon Brothers, Inc. Read the IMF Press Release. Read Bretton Woods Project commentary.
• African Development Bank: AfDB Annual Meetings. May 17-18. Read more on the AfDB website.
• World Bank: World Bank reportedly investigating allegations of corruption in six Indian projects. May 16, 2006. Read more on the BIC website.
• European Bank for Reconstruction and Development: EBRD approves new disclosure policy. May 16, 2006. The EBRD Board approved new transparency requirements for the institution. Little progress has been made... Read the Public Information Policy on the EBRD website. Read civil society comments on the policy on the BIC website.
• World Bank: Nigerian communities register complaint about the West Africa Gas Pipeline with the World Bank Inspection Panel. May 11, 2006. Read more on the BIC website.
• World Bank, IMF, African Development Bank: Cameroon to receive debt cancellation. The World Bank, International Monetary Fund and the African Development Bank announced that over $2 billion of Cameroon's debt will be erased. May 4, 2006. Read more on the BIC website.
• World Bank: World Bank to resume lending to Chad after interim agreement reached with government. The accounts had been blocked since January of this year, when the Bank suspended lending to the country following the government's decision to rewrite the revenue management law and use oil money for security spending. May 3, 2006. Read BIC analysis.
• Asian Development Bank: ADB reorganizes some regional department country groupings. May 1, 2006. The reorganization follows recommendations made in the institution’s April 17 “Re-alignment of Regional Departments” paper. Read more on the BIC website.

• Center of Concern: World Bank finds way to bypass restrictions in lending for infrastructure to sub-national entities. May 19, 2006. Aldo Caliari reviews a World Bank report titled “Sub-National Development Program”. The projected program is based on the provision of technical assistance and financing for sub-national entities without sovereign guarantees, and preferably in local currency. Read the summary.
• Eurodad and erlassjahr.de: To Pay or To Develop: a Handbook on Debt Sustainability. May 19, 2006. This publication clarifies different conceptions of debt sustainability. It points out problems with official definitions and frameworks that are applied by the international financial institutions and other creditor instances of creditor governments, such as the Paris Club. It also outlines alternative approaches and methods. Read the handbook on the Eurodad website.
• Bretton Woods Project: IMF director makes uninspiring choice for deputy. May 19, 2006. With the imminent departure of Anne Krueger from the post of first deputy managing director of the IMF, Rodrigo de Rato had a unique chance to move the Fund in a different direction as it looks to implement its medium-term strategic review. Instead, the managing director nominated US banker John Lipsky, maintaining the convention of keeping the top two posts at the Fund split between the transatlantic power centres. Read the article on the BWP website.
• Bank Information Center: The Asian Development Bank's priority is business, not alleviating poverty. May 15, 2006. BIC's Asia Program Manager Mishka Zaman argues that borrowing countries increasingly, and effectively, pressure the institution to relax lending standards. Article appeared in the May 15 issue of Down to Earth magazine. Read more on the BIC website.
• Bank Information Center: Despite major environmental problems, Sakhalin increasingly attractive to Western oil and gas companies. May 12, 2006. Read more on the BIC website.
• Environmental Defense and International Rivers Network: Pakistan's rot has World Bank roots. May 12, 2006. Shannon Lawrence and Peter Bosshard contend that the World Bank's actions facilitate rather than discourage corruption in the country's infrastructure projects. Read the article in the May 2006 Far Eastern Economic Review (membership required).
• Joint NGO Statement: NGO Comments on the Proposed Revision of the Equator Principles. April 26, 2006. The Equator Principles are a statement of commitments by private banks to abide by the environmental and social standards of the International Finance Corporation when lending for investment projects. The principles have recently been revised to reflect the IFC’s newly-updated policies. Read comments from 25 NGOs on the Banktrack website.

Visit BIC’s Wolfowitz Watch webpage: http://www.bicusa.org/bicusa/issues/wolfowitz_watch/index.php

The worst man in the world?
By Robert Calderisi, the New Statesman
May 15, 2006.
Robert Calderisi revisits many of the concerns that have circulated about World Bank President Paul Wolfowitz in recent months, including his slowness to reveal his plans, delays in making a number of senior appointments, and unequal mix of planning and management skills. Wolfowitz has “retreated into a shell and rarely meets his vice-presidents,” Calderisi writes, maintaining a “secretive and unilateralist” presence and preferencing his cadre of close advisors over the institution’s established “civil service”. Calderisi notes that, to his credit, Wolfowitz has seemingly resisted US government pressures to preference certain regions and sectors. If he “…engaged more actively with his managers, it is possible that a famous neoconservative could drag a venerable institution on to political ground where liberal interventionists such as Woodrow Wilson and William Gladstone would have felt comfortable,” he concludes.

• Read the article (New Statesman website)

The Asian Development Bank held its 39th Annual Meeting in the Indian city of Hyderabad from May 3-6. Scorching temperatures did not prevent a lively network of 87 Indian groups and international partners organized under the People’s Forum Against the ADB (PFAAD), a group calling for cessation of ADB operations in Asia-Pacific, from greeting the ADB with street demonstrations, corner meetings, panel discussions, cultural programs, press conferences and a film festival.

Some 30 kilometers away from the venue of the Peoples Forum activities, the ADB and member government representatives met in the cooler environs of the Hyderabad International Convention Center (HICC) in the neighbouring city of Cyberabad. Entry to Cyberabad was heavily monitored. Only authorized vehicles were allowed access to the convention center, and pedestrian passage was monitored by hundreds of police guarding the roads to the official venue. All participants required accreditation, and were ferried to the venue by buses running from the many luxury hotels hosting participants.

Most Indian civil society organizations and peoples movements declined to participate in the meetings. Some groups did attend official meetings, however, participating in seminars and panel discussions in an effort to highlight issues and concerns of communities affected by the ADB. One such event was a Question Hour with the ADB President Kuroda, during which affected people from Thailand, Nepal, Bangladesh and Sri Lanka posed questions about the negative impacts of ADB projects in their communities. The Bank Information Center actively participated and helped organize events at both the Peoples Forum venue and at the HICC, including a workshop for journalists and a panel titled “Accountability at the ADB”.

The AGM ended with some disagreement between ADB’s donors and its East Asian member countries about the appropriate role for the institution in supporting the development of a common Asian currency, a pet project of the current ADB President Kuroda. Many donor countries were not supportive of ADB going down this path, while the ASEAN + 3 grouping was keen to move forward with the idea. Another set-back for the ADB was the divergent views of shareholders on its Medium Term Strategy II (2006-2008) which prevented its wholesale endorsement by the Governors.

More information:

• Peoples Forum Against the ADB website
• NGO Forum on the ADB website
• Bank Information Center website
• ADB website

When two poor countries reclaimed oilfields, why did just one spark uproar?
By George Monbiot
The Guardian
May 16, 2006
George Monbiot exposes the apparent hypocrisy in official reactions to Bolivia’s nationalization of its gas and oil fields last month, and Chad’s parallel move to seize control of its oil revenues last December. Bolivia’s President Evo Morales has been widely denigrated for his decision, Monbiot explains, as critics overlook Bolivian popular support for the move and its potential to bring real benefits to the Bolivian people. Official reaction to Chad's President's actions has ultimately been much less severe. Civil society has voiced concerns over the viability of the Chad-Cameroon pipeline for years, and were hardly surprised by Idriss Deby’s seizure of the country’s oil resources. Although the World Bank initially froze lending to the country in January in response, it was restored in April 27 after Deby threatened to shut down the country’s oil wells. Why the apparent inconsistency in reactions? “Well, Deby’s actions don’t hurt the oil companies. Morales’ do,” Monbiot writes. “When Blair and Rice and the Times and all the other apologists for undemocratic power say “the people”, they mean the corporations. The reason they hate Morales is that when he says “the people”, he means the people.”

• Read the article (Guardian website)

Reviving the Bank and Fund
Allan H. Meltzer
Journal of International Organizations
In the inaugural issue of the Review of International Organizations, Allan H. Meltzer discusses some of the current challenges facing the World Bank and International Monetary Fund, and recommends how the two institutions should modify their efforts. Of particular importance is the need to develop incentives to promote better governance and prevent corruption – developing plans to put their rhetoric on this issues into practice. Both institutions must furthermore define their respective territories. If the IMF continues to use the PRGF, for example, it much better negotiate its overlap with the multilateral banks.

As the World Bank’s primary challenge is to gauge the effectiveness of its programs, it must implement independent evaluations of its programs, Meltzer writes. The Bank should also focus its efforts on the most impoverished countries, although it should continue to provide technical assistance even after a country has graduated from receiving lending. Challenges facing the IMF include the ongoing need to define its role in developing countries, and balancing country ownership and conditionality. “The fund of the future must depend more on incentives and country decision-making and much less on conditionality and promises,” he writes.(55) The institution must also promote much-needed institutional reform while remaining politically neutral, and a more stable exchange rate system.

The author’s arguments indeed echo repeated civil society calls for the IFC to specify its development objectives, define how to measure outcomes, and report on activities in a truly independent and objective fashion.

• Read the article on the journal's website

• ADB draft paper on Ordinary Capital Resources (OCR) and middle-income countries available for comment until May 28. Read more on the ADB website
• EBRD’s Country Strategy Review for the Russian Federation open for comments until May 31. Read more on the EBRD website
• The World Bank revision of Operational Policy (OD) 13.60, Dissemination and Utilization of Operations Evaluation Department (OED) findings with Operational Policy (OP) 13.60, Monitoring and Evaluation. Comments accepted until July 7. Read more on the World Bank website.
• The IFC has begun the public consultation process for revising its Sectoral Pollution Standards and its accompanying Environmental and Health Guidelines. The guidelines will be released mid-May through August. Standards will be available for a 60-day comment period after they have been released. Read more on the IFC website.
• 2006 World Bank/IMF Annual Meetings accreditation will open from June 1 through August 4. The meetings will be held September 13-20 in Singapore. Visit the World Bank website for more information.

The book is an inspired account of a grassroots movement in Latin America for sustainable agriculture: poor farmers who teach each other how to protect the environment while at the same time earning enough to live.

• Visit the Food First website for more information or to purchase a copy.
• Join BIC for a book launch and presentation on June 1, 5:30-7:00pm, Busboys and Poets.

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