FEER Issue cover-dated June 27, 2002
http://www.feer.com/articles/2002/0206_27/p045money.html
WORLD BANK President James Wolfensohn was in Mongolia to give his support to the International Finance Corporation's efforts to provide loans to small business. In Ulan Bator he spoke with the REVIEW's David Murphy:
DO YOU UNDERSTAND THE ANGER IN THE DEVELOPING WORLD THAT THE WEST HAS BEGUN TO UNDERSTAND SINCE SEPT. 11? I think I understood the anger before 9/11. If you don't deal with the poverty question you're not going to have global peace. I think that what happened with 9/11 is that people in the developed countries now understand that there is real distress in the developing countries. In the world today you have 5 out of 6 billion living in developing countries and in 25 years time you'll have seven out of eight. Europe will be smaller and older, the United States will be bigger but only because of immigration. If we don't deal with that question, in my judgement there's no way of having global peace for our kids. I really believe that.
DOES BUSH BELIEVE THAT? HIS MAIN RESPONSE HAS BEEN A MILITARY ONE. They did have the other response and announced a 50% increase in overseas development aid. And now Secretary [Paul] O'Neill [has been] on a 10-day tour of Africa, with Bono, which I think is the longest tour any secretary of the Treasury has ever taken.
ARE YOU WORRIED THAT SINCE SEPT. 11 CENTRAL ASIAN STATES ARE BECOMING MORE AUTHORITARIAN? I didn't get the sense they are becoming more authoritarian. I got a sense they are becoming more concerned about the rise of fundamentalism as a political movement in these countries but most of them were pretty much on top of this before 9/11. It was the people in the West that didn't understand the risks before 9/11 and didn't understand what was happening. But if you spoke to Putin, as I did, he understood before 9/11, the leaders of the five Central Asian countries understood, the Pakistanis and the Afghans certainly understood. Nothing has changed with them.
SINCE SEPT. 11 THERE IS A NEW FOCUS ON THE NEED FOR STABILITY IN CENTRAL ASIA. HOW CAN THE FORMER SOVIET STATES SHAKE OFF POVERTY? The internal market is too small to allow them to jump ahead without dependency, but it's absolutely possible for them to achieve decent growth if they gain access to nearer provinces in Russia and China . . . there's a need for this whole market to come together. It's too small on its own but together as it was when it was joined by the Silk routes it has great possibility.
CAN THEY CONTINUE TO BE AUTHORITARIAN AND MOVE TOWARDS A FREE TRADE ZONE? The level of authoritarianism varies between countries but they are all talking about moving towards freer trade and higher productivity, and I think what you are seeing is a transition to the market economy with leaders who have in many cases grown up in the planned economy. I believe that all of them sincerely want to do that and I think again, as in this country [Mongolia], the question will be in the next 5-7 years, do they act on what they are saying? That's the challenge here and in Central Asia.
IS THERE THE WILL TO ACHIEVE THE TECHNOLOGY TRANSFER TO DEVELOPING COUNTRIES THAT CLINTON, BLAIR AND OTHER WESTERN LEADERS HAVE TALKED ABOUT? It's tremendous specifically in China. When you talk about the use of technology to bridge the digital divide, China probably will be in 10 years the No. 1 example. But it will be closely followed by India. The interesting thing is that on the Voices of the Poor study, where we interviewed 60,000 poor people in 60 countries, we had a number of the very poorest come to the bank for the launching of the book, and I asked them what was the number one thing they wanted. They said technology and information, they didn't say food, they didn't say charity, they said technology and information. Poor people know as well as anybody else that what keeps them poor is lack of competitiveness and lack of knowledge.