The Humanitarian Times

April 20, 2000

 

- GLOBAL DISASTER INFORMATION NETWORK ("GDIN") WILL LINK EXPERTS next week -- April 26-29, at 3rd major conf., in Ankara, Turkey.

The GDIN network seeks to mitigate vulnerability, increase public knowledge, & support coordinated relief, articulated in the proposed "Ankara Declaration" & building on the Tampere Convention on Emergency Telecommunications. Reps from 41+ countries will discuss satellite networks & pilot projects (for example, Europe's TN Edis), along with emerging sensing, cartographic & analytic techniques for tracking earthquakes, floods, fires, oil spills & harmonization of GIS reporting, for example, on Relief-web. Info is available on numerous websites: Agenda: www.gdin-international.org/conf_agenda.html ; charter: www.NRCan.gc.ca/ressources/global History: www.state.gov/www/issues/relief/gdin.html .

Conference info: www.deprem.gov.tr/gdin2k/index.html.

- BANGLADESH TO RECEIVE $2B IN AID, DONORS AGREED IN PARIS LAST WEEK

- U.N. TO PHASE DOWN PEACE OBSERVER MISSIONS IN TAJIKISTAN transitioning to civilian monitors, as per peace agreement.

-$30M IN US AID TO HAITI WAS SUSPENDED, OVER EXPROPRIATION of a U.S. corporation by by Haiti's govt. US Senate Foreign Relations Chairperson J Helms froze funds that had been appropriated for agriculture & business dev. Haiti's Pres. has now announced, after much intl. pressure, a new date -- May 21 -- for the repeatedly-postponed national elections.

-250 PEOPLE DROWNED IN 2 SHIP SINKINGS NEAR PHILIPPINES & AUSTRALIA

- JAPAN INTENDS TO FORGIVE UP TO 100% DEBTS OF POOREST COUNTRIES it says, as part of a G-7 effort to reduce claims from official dev. assistance. Japan will also add $200M to the World Bank debt relief trust fund.

-INTL GOVTS PLEDGE $800M NEW AID TO UGANDA, DESPITE HIGH MILITARY SPEND

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DEBATES OVER THE INTERNATIONAL MONETARY FUND (IMF) & WORLD BANK

 

In rapid order, 3 major debates brought unprecedented attention this year to the IMF & World Bank (separate agencies, though physically adjacent in WashDC, & created jointly in 1944). The first was the public search for the new IMF Director, who will be Horst Kohler, currently Pres. of the European Bank for Reconstruction & Dev, the 2nd candidate Germany proposed. The most publicized debate occurred during the past week when 5,000 leftists protested in WashDC, calling for the abolition of both the IMF & WBank, charging that they coerce nations into crippling debt, push policies that favor the wealthy & worsen poverty. More informed NGOs, such as Oxfam, instead work with the WBank to promote expedited & expanded debt relief. In yesterdays' NY Times describes how the WBank's anti-tariff policies in Mozambique promote higher earnings/income of Mozambique's poor: rural farmers.

Krugman disagrees with the protesters who refer to Mozambique's smaller but vocal anti-trade urban population.

The 3rd debate followed the Meltzer Commission Report, commissioned by US Congress, released in early March, which recommends that IMF long-term lending to poor nations be eliminated & that the IMF review nations in advance of financial stability crises, to pre-qualify them for emergency aid. Dutch, Swedish, German & British Treasury, & oth European foreign aid ministers disagree, in their new report, "The World Needs Strong Multilateral Dev. Institutions." The Wash Post's editorial (March 13) argues that the IMF needs to continue to lend to the poorest countries: "no other institution is better equipped to monitor macroeconomic policies." In essays following the Meltzer report, WBank Pres. J Wolfensohn wrote that the WBank's operational performance has been improving markedly: "A critical strength of the W Bank is its ability to learn from developing countries in all regions of the world & to reflect those lessons in its policy advice & operations & in its global research. ..if the W Bank were to stop lending for anti-corruption work, good governance, regulatory reform & institution building, it would cease to create the kind of enabling environment that can attract private funds to areas that currently receive little."

-"THE INTL MONETARY FUND: FINANCIAL MEDIC TO THE WORLD, A PRIMER On Mission, Operations & Public Policy Issues" by L McQuillan, P Montgomery (eds. 1999 Stanford CA : Stanford Univ) explains the various finance mechanisms ('balance of payments assistance facilities') & critiques the IMF's recent practices, such as bailing out medium- wealth countries such as Mexico. R Vaubel explains that the IMF evolved into a "continuous provider of aid, in the form of subsidized insurance" & observes that the IMF plays a valuable role as the "bad cop" which allows govts to make wise but unpopular policy choices: "the policy conditions imposed by the IMF may be unpopular, but political leaders have "made them scapegoats for unpopular economic reforms." D Bandow critiques the IMF's current ad-hoc conditionality, & proposes that the IMF not bail out countries which intentionally get themselves into trouble; "moral hazard could be reduced if the IMF would at least issue strict rules for its conditions." S Edwards reviews experience with poor countries which received conditioned IMF lending after the 1983 'debt crisis & finds that in the years since, they had poor compliance with macroeconomic promises; he argues for a revised form of conditionality whereby more positive incentives for compliance are perceived by the debtor countries. J Levinson complains of the IMF's mission creep, away from an interest in supporting democratic practice to high loans to countries like Indonesia which "suppressed trade unions, a free press, an independent judiciary & opposition political parties." Levinson encourages the IMF to include repression & human rights in its lending appraisals: "even when the primary goal is fostering a secure investment climate - the IMF & W Bank cannot ignore the absence of institutions that ensure an orderly transition in govt & can provide effective checks against abuse of power." Paul Krugman counters the arguments of those who feel that financially-troubled nations should resolve their problems themselves, observing that even the most modern investors are liable to sharp, unpredictable & sometimes-devastating business cycles: "both theory & evidence suggest that no matter how much due diligence individual investors may exercise, financial markets are vulnerable to self- reinforcing collapses of confidence unless there is a 'lender of last resort.'" L Summers assigns important achievements to the IMF: trade liberalization across the developing world, support for Russia's tender transition from a state-dominated hyper-inflating economy, stabilized crises in Poland, Mexico, Argentina & elsewhere, & structural adjustment benefits, including reduced military spending by many countries.

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April 20, 2000 The Humanitarian Times

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