WOLFENSOHN: 'WE WANT DIALOGUE ON GLOBALIZATION'.
World Bank President James Wolfensohn says in an interview with the Australian Financial Review that he does not dismiss the protests or concerns of the anti-globalization protesters at the World Bank/IMF Annual Meetings in Prague this week, even though he is a key target. In fact, Wolfensohn agrees with many of their concerns and wants to bring the demonstrators into the tent of global problem-solving, rather than holding them at bay at the end of a police truncheon.
"The best possible way of looking at this is that these protests will help create an awareness among young people of global problems, " Wolfensohn says. He believes the World Bank can work with NGOs, some of which will be in the streets in Prague, to address world poverty. While Wolfensohn agrees that the Bank is "not perfect," says the story, he says it is one of the most positive forces in the world for fighting poverty.
And he says that the Bank is already well advanced in working with NGOs. "We used to have two staff dealing with civil society. We now have 70, and 2,500 people out in the field." And now Wolfensohn has decided to increase dramatically the Bank's contact with NGOs, says the story, noting that he has invited 300 to the Prague meetings as official guests.
Meanwhile, though the Czech government and protester groups downplay the possibility of violence during protests at this week's meetings in Prague, both seem to be preparing for the worst, reports the Handelsblatt/Wall Street Journal Europe IMF Update. Czech soldiers are preparing to man six armored vehicles for more than 200 registered protest actions, which are expected to attract between 20,000 and 50,000 participants.
Czech President Vaclav Havel has adopted a velvet glove approach to defuse any new, explosive anti-globalization protests when IMF and World Bank officials gather here for their annual meeting next week, AFP reports. In a speech over the weekend, Havel called for a civilized, informal dialogue between those for and against globalization. He welcomed "all those people who arrive with the willingness to contribute to solving world problems."
Havel will chair a debate of 300 IMF and World Bank officials and NGOs at Prague castle on September 23. Also attending will be "alternative" economists and other opponents of globalization. UN High Commissioner for Human Rights Mary Robinson, IMF Managing Director Horst Köhler, and Wolfensohn, will also attend. Havel said the forum was designed to create "a spirit of dialogue and mutual understanding" so as to "positively influence the atmosphere" in the Czech capital.
In other Prague-related stories, Lidove Noviny (Czech Republic) reports that those planning to march during the meetings include INPEG, Jubilee 2000, Friends of the Earth, Rainbow Movement, CEE Bankwatch, Earth First, Communist Union of Youth and Socialist Labor Organization, and the Czechoslovak Anarchist Federation. The Wall Street Journal (9/18) also reports, noting that municipal clerks in Prague are working overtime to register all the protesters who want permits to stage demonstrations. As of late last week, says the story, 205 protests had been registered for the 10-day event. "Normally, we don't even get 200 for the entire year," said a city council spokesman.
Dialogue, harmony and understanding are the keywords at the annual meetings of the IMF and the World Bank, the TAZ (Germany) reports meanwhile. World Bank Vice President for External Relations Mats Karlsson, in Berlin last wee k, said the Bank was seeking a dialogue. People want to talk about globalization, he noted.
One of the most important tasks for the Bank will be to help poor countries obtain cheaper medicine against the AIDS virus, the story says Karlsson noted. The World Bank and the WHO are striving to provide cheaper medicine for the poorer countries, and it looks like companies will agree to sell it at a cheaper price.
Handelsblatt (Germany) meanwhile notes that the Bank has announced a $1 billion commitment to fight AIDS in the developing world.
It will also be important in Prague to discuss the relation between the IMF and the World Bank, the TAZ continues. A study published during the institutions' spring meetings argued for the retreat of the IMF from the poorest countries, which it said should turn to the World Bank instead. The IMF meanwhile should only concentrate on short-term bail-outs of the industrialized countries and for the emerging economies. Karlsson thinks that the conventional wisdom that "the World Bank repaired what the IMF had destroyed" has changed. There is cooperation, he says, citing the international debt relief program.
Die Welt (Germany) also reports on the division of tasks between the IMF and the World Bank, saying that the institutions in the future will concentrate on their core tasks: for the IMF monetary, fiscal and exchange rate policies; for the World Bank a commitment to fighting poverty as well as helping implement structural, institutional and social reforms. "We are not going to reinvent the IMF," Köhler, who is expected to officially outline reforms of the Fund tomorrow, is quoted as saying. Mittelbayerisher Zeitung (Germany), Der Standard (Austria) and Kurier (Austria) also report.
Preparations for the annual meetings of the World Bank and the IMF in Prague are widely reported in the international press, as Czech Finance Minister Pavel Mertlik says in an interview with Hospodarske Noviny (Czech Republic) that the World Bank-IMF meeting in Prague definitely entails benefits for the Czech Republic, such as international prestige, direct contact with investors and a chance to promote the nation.
Emerging markets are in generally good shape as the Fund and the Bank head to Prague for their annual meeting and analysts say prospects for most are continuing to improve, Reuters notes. Since the Asian, Russian and Brazilian financial crises of 1995 on, economies from the developing world have benefited from both external factors, such as a benign global economic environment and rising commodity prices, and market-oriented policies from their own governments.
In a related Prague story, AFP reports that North Korea has rejected the unprecedented invitation to attend the World Bank/IMF meetings next week, officials said today. "We heard through the IMF that North Korea will not attend the Prague meeting because of a short period of preparations," Kim Yong-Duk, a senior South Korean finance and economy ministry official, told reporters. Yet the Communist nation, isolated for decades, remained "keenly interested" in the two organizations, he said. South Korea has urged the North to join international financial organizations such as the IMF and the World Bank to pave the way for securing loans to rebuild its moribund economy, the story notes.
THE WORLD BANK'S SOCIAL RECONSTRUCTION.
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.
Le Figaro (France, 9/18, p.II) also reports on the Bank's efforts to make the fight against poverty its first priority.