Tuesday, December 14, 2010

NGOs demand reforms from World Bank before new loaning cycle begins

A part of the World Bank that provides interest free loans to the world's poorest countries is about to announce a new funding package. The International Development Association will announce how much money they will have available for the next five years thanks to government contributions. Before the new funding cycle begins, NGOs want the donor governments to insist on new reforms from the bank.

From the Inter Press Service, writer Matthew O. Berger describes the demands that NGOs are making.

"We do support an IDA replenishment but we think it would be a missed opportunity if donors did not use their leverage for change," said Oxfam spokesperson Elizabeth Stuart.

Donor governments are expected to be somewhat stingier this time around due to the economic crisis and waves of austerity measures, but, says Stuart, that bleak economic situation should be all the more reason for thorough tracking and transparency of where IDA funds go and what they accomplish.

"It is the responsibility of donors to ensure the Bank is spending the money effectively during the recession," she said.

The Bank's case for replenishing IDA's coffers rests on what it sees as the fund's successful track record over the past decade, particularly in helping to spur economic growth in many poor countries before the economic crisis rolled back some of that progress.

For its part, IDA has scaled up its work in the past 10 years, increasing its lending and grants from 4.4 billion dollars in 2000 to 14.5 billion in 2010.

The Bank also points to reforms that have tried to track the results this lending has had.

But Oxfam's Stuart says the reforms have not yet gone far enough.

"The Bank talks a lot about tracking results but this tracking is often too technical and doesn't include the right indicators. People can't really understand it. We need something very simple that both taxpayers and people in poor recipient countries can understand," she said.

Not all NGOs are as critical of IDA's progress on openness, though. InterAction, an alliance of U.S.-based NGOs of which Oxfam is a member, has many other members that are much more positive about the replenishment process, said John Ruthrauff, director of international advocacy at InterAction.

Though there are certain reforms InterAction would like to see implemented, Ruthrauff is hopeful the Bank is starting down that reform path, as indicated by the Bank agreeing to inform InterAction and other civil society organisations, in writing, of the changes made to the draft IDA replenishment report.

"This is a very important step because the Bank never tells civil society whether or not their input had any impact," said Ruthrauff.

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