The Bank of the South: An Alternative to the IFIs?
In early June, the Bank of the South moved a step closer to becoming a reality as the Ministers of Finance of Venezuela, Argentina, Paraguay, Brazil, Ecuador and Bolivia met in Buenos Aires to discuss its founding constitution. In addition to functioning as a development bank and a source of stabilization funds, the Bank is seen as a precursor to a regional monetary system. Just as significant is the Bank of the South’s role as an alternative to the World Bank and IMF, whose policies in Latin America have faced substantial regional criticism. In this respect, the Bank is seen as a valuable mechanism for re-asserting Latin America’s economic independence and political sovereignty.
The Bank of the South: An Alternative to the IFIs?
Wolfowitz & World Bank in the spotlight over scandal
While the World Bank's executive directors have yet to make a decision on the future of president Paul Wolfowitz, calls for the former U.S. deputy defence secretary’s resignation are gaining momentum. The Bank’s Independent Evaluation Group (IEG), which assesses the degree to which the Bank's work meets its stated objectives, issued a formal statement described by the Financial Times as a “searing indictment of Paul Wolfowitz's leadership.”
Civil society/Industry make unprecedented joint recommendations on mining, oil and gas
Canada could become a world leader on Corporate Social Responsibility if the federal government and other stakeholders accept and act on the recommendations of a groundbreaking report released on Parliament Hill on Corporate Social Responsibility (CSR) and the Canadian extractive industry in developing countries. The Report outlines a set of consensus-based recommendations for the Government of Canada, core among which is the implementation of a Canadian CSR Framework (see “Just the Facts” below). If implemented, these recommendations would establish Canada as a global leader in CSR. The Report also calls for important reforms at Export Development Canada and the World Bank.
UN Special Representative explores human rights obligations of financial institutions
There is growing consensus that human rights rank high among the pressing challenges that face both the private sector and its financiers. On February 16, the UN Secretary General’s Special Representative on Human Rights and Transnational Corporations, John Ruggie, and the Office of the High Commissioner for Human Rights convened a consultation on human rights and the financial sector in Geneva. The meeting included representatives from a number of export credit agencies (ECAs), the World Bank’s International Finance Corporation, several Equator Principle banks, academia and civil society.
OECD knocks Britain over corruption
This month over 140 non-governmental organizations (NGOs) warned the UK government of the “irreparable harm” the move may cause to the country’s reputation as an anti-corruption champion. British NGOs Campaign Against the Arms Trade (CAAT) and Corner House have signaled their intention to initiate a judicial review of the SFO decision to drop the inquiry.
Norway “seeks the truth” on Bank conditionality
The Norwegian government, whose aid money cannot be spent on programs that require trade liberalization and privatization, hosted an inter-governmental meeting in November to assess the extent to which the World Bank and IMF still require developing countries to pursue privatization and liberalization as a condition of support. An independent study commissioned for the meeting, determined that while the World Bank and IMF are still pushing privatization and trade liberalization in their development policy lending, it is less pervasive than in the past. It also concluded that governance conditions are increasingly taking the place of economic policy prescriptions, and that developing government “ownership” over Bank and Fund policies is still weak.
Groundswell of Interest in Canadian Overseas Extractive Operations
This month the Government of Canada’s final roundtable on Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries was held in Montreal (see April 2006, Issue update). In order to accommodate public demand, more time was dedicated to public sessions in the November roundtable than in any of the previous consultations. Roundtable participants heard diverse perspectives from an impressive range of stakeholders. An Indonesian speaker described how her community is affected by the operations of a Canadian mining company. John Ruggie, the Special Representative of the Secretary-General on business and human rights also addressed roundtable participants.
Norway cancels illegitimate debt
On October 2, in an unprecedented move, Norway's International Development Minister, Erik Solheim, announced that the Norwegian government would unilaterally and unconditionally cancel US$80 million (NOK520 million) of illegitimate bilateral debt held by Ecuador, Egypt, Jamaica, Peru and Sierra Leone. Acknowledging that these debts stemmed from a “development policy failure”, Oslo also accepted that as a creditor country it had a shared responsibility for the debts. Furthermore, the cancellation will not form part of Norway’s Overseas Development Assistance, meaning that it will be additional to current aid spending.
Fallout at Bank and Fund meetings in Singapore
The Work Bank and International Monetary Fund’s (IMF) fall meeting in Singapore from September 19-20, were mired in controversy this year. In the days prior to the meeting, it became clear that Singapore intended to ban numerous accredited organizations from entering the country. In response, groups unilaterally boycotted the official program. Organizers of the parallel International Peoples Forum in Batam, Indonesia, reported that 54 individuals from 17 groups were detained at the Singapore airport without explanation, and subjected to custodial interrogation and deportation. Many groups felt that, with IMF reform and good governance and corruption on the agenda, the choice of Singapore as the venue for the meetings underscored the superficial nature of the Bank and Fund reform agenda.
Singapore Meetings Emphasize “Civil” over “Society”
On September 19th and 20th, the World’s Finance Ministers will gather in Singapore for the traditional fall meetings of the World Bank and International Monetary Fund (IMF). Although the Bank and IMF will host their own Civil Society Forum, Singapore has banned the traditional outdoor protests that accompany the meetings – providing a designated protest lobby area instead. They have also been tightening border controls and stepping up border security.