IF-EYE Newsletter
Issue #25
Wednesday, November 14, 2007
A publication of the Bank Information Center
Welcome to the November 14, 2007 issue of the IF-EYE – the Bank Information Center’s bi-weekly synthesis of key developments concerning international financial institutions. This issue includes information on BIC's analysis on the launching of the Bank of the South as well as an update on the Asian Development Bank's Safeguard Policies. Please send suggestions, contributions and subscription requests to: info@bicusa.org. Thanks for reading!
In this issue:
1. IFI Updates
2. Civil Society Highlights
3. SPOTLIGHT: Bank of the South
4. SPOTLIGHT: Asian Development Bank Safeguard Policy Update
5. Announcements and Resources
1. IFI Updates
IMF cancels Liberia’s debt
11/13/2007 International Monetary Fund
The International Monetary Fund (IMF) announced that it will write off Liberia’s debt by securing $842 million from its own institutional reserves and donor country pledges. The move comes after the Fund endured heavy criticism in the international media last month for not following through on its commitment to Liberia, eighteen months after the country had met the IMF’s stringent policy conditions.
IMF Managing Director Dominique Strauss-Kahn Announces Financing Milestone on Debt Relief for Liberia, IMF Press Release No. 07/254, November 12, 2007 (IMF website)
Read more (BIC website)
World Bank president travels to South Asia
11/12/2007 World Bank
President Robert Zoellick recently toured Pakistan, India and Bangladesh. He visited several large infrastructure projects in the region.
Learn more about Robert Zoellick's visit to South Asia (World Bank website)
Terms of appointment for International Monetary Fund head disclosed
11/7/2007 International Monetary Fund
For the first time, the International Monetary Fund (IMF) has publicly disclosed the official terms of appointment for its new Managing Director, Dominique Strauss-Kahn. His terms include an annual salary of $420,930, an annual allowance of $75,350 for maintaining “a scale of living,” and the ability to resign from his position at any time.
Read the Terms of Appointment of Dominique Strauss-Kahn as Managing Director of the International Monetary Fund, International Monetary Fund Press Release, November 2, 2007 (IMF website)
2. Civil Society Highlights
Press release: Taman tries the taste of oil
11/12/2007 Environmental Watch on the North Caucuses
On November 11, 2007 in the Strait of Kerch a massive shipwreck occurred causing 1,300 tons of heavy, viscous oil — the equivalent of 560,000 gallons — to spill into the sea. A colossal environmental catastrophe has ensued. A significant part of the shoreline of the Taman Peninsula is immersed in petroleum products.
Read more (BIC website)
Coalition calls for release of report on mining contracts in the Democratic Republic of the Congo
11/7/2007 Various Organizations
A coalition of non-governmental organisations from Europe, North America, and the Democratic Republic of Congo (DRC) launched an international appeal demanding the publication of the final report of the ministerial commission on the review of mining contracts without delay. The mandate of this commission, created by a ministerial decree on 20 April 2007, is to “examine partnership contracts and their impact on the recovery of these companies and national development, to propose, if necessary, modalities for their revision with a view to correcting any imbalances and related faults.”
Read more (BIC website)
People’s tribunal in Bangladesh announced
11/5/2007 People's Tribunal Against the World Bank, International Monetary Fund and Asian Development Bank
Academics, economists, politicians and activists jointly announced the formation of a people’s tribunal against the World Bank, International Monetary Fund (IMF) and the Asian Development Bank (ADB) on November 4th. The announcement was made at a press briefing at the National Press Club in Dhaka, a few hours before the arrival of the World Bank president, Robert Zoellick to the country. The tribunal’s national preparatory committee was convened after former justice, Golam Rabbani, announced its formation.
People's Tribunal against WB, IMF and ADB announced in Bangladesh, New Age, November 4, 2007 (Bangla Praxis website)
Civil society organizations draft open letter to Bank of the South members
11/2/2007 Jubilee South, Various Organizations
On November 1, Jubilee South and other civil society organizations unveiled an open letter to the presidents of Argentina, Bolivia, Brazil, Paraguay, Uruguay and Venezuela calling for a sovereign, supportive, sustainable and integrated Bank of the South prior to its expected launch in early December, 2007.
Read the open letter to the Bank of the South members available in English or in Spanish (Jubilee South website)
Non-governmental organizations urge World Bank to stop funding mega-projects in Pakistan
11/1/2007 Pakistan Network for Rivers, Dams and People
As the World Bank President Robert Zoellick embarked on his first official visit to South Asia, non-governmental organizations in Pakistan called on the Bank to cease funding for large infrastructure projects. Representatives of communities adversely affected by mega projects in Pakistan, such as hydro-power dams, urged Zoellick not to fund "economically, environmentally and socially infeasible projects in the country."
Read more (BIC website)
Tax Justice Network and Transparency International debate corruption
Alliance Sud, Tax Justice Network, Transparency International
The Corruption Index prepared by Transparency International (TI) is regarded as a measure of a country’s level of corruption. The Tax Justice Network (TJN) believes this is not the case however. TJN argues that the Index focuses almost exclusively on bribery and overlooks other corrupt practices, including tax evasion and illegal capital flight. The result, TJN claims, is a distorted "geography of corruption" that makes excuses for the role played by financial centres in industrialised countries.
Follow the debate between Anne Schwoebel (Transparency International Switzerland) and John Christensen (Tax Justice Network) (Alliance Sud website)
3. SPOTLIGHT: Bank of the South
11/14/2007 Vince McElhinny, Latin America Program, Bank Information Center
Eight countries are planning to inaugurate the Bank of the South in December 2007. Joining ALBA countries (Venezuela, Bolivia), Ecuador Argentina, Brazil, Paraguay and Uruguay, Colombia decided two weeks ago that it too would join the initiative. Peru and Chile have so far remained silent.
Technical staff from each country have been intensively negotiating the founding statutes for the Bank of South since April. While some stated benchmarks for reaching key agreements have been missed, the continued progress to build unity behind the ambitious and unprecedented initiative have underscored the significance and complexity of launching the Bank of the South.
The Bank of the South represents the cornerstone to a more wholesale renovation of the regional financial architecture long dependent on Northern banks. A regional monetary fund, a common regional currency, a regional network of state development banks, regional stock and commodities exchanges, a regional Parliament (based in Cochabamba) and a regional Social Fund are only some of the new institutions imagined by the current crop of South American Presidents. Whether these institutions emerge under the auspices of the Union of South American Nations (UNASUR), Bolivarian Alternative for the Americas (ALBA), Community of Andean Nations (CAN) or the Southern Common Market (Mercosur) is unclear.
Read BIC's new Info Brief on the Bank of the South (BIC website)
4. SPOTLIGHT: Asian Development Bank Safeguard Policy Update
11/6/2007 Mishka Zaman, Asia Program, Bank Information Center
In July 2005, the ADB announced it would update its three safeguard policies : Environment Policy (2002), Policy on Involuntary Resettlement (1995), and Policy on Indigenous Peoples (1998). According to ADB, the objective of the Safeguard Policy Update is “to enhance the effectiveness of its [ADB’s] safeguard policies, and ensure the relevance to changing client needs and new lending modalities and instruments.” In October 2005, the ADB issued a Discussion Note outlining key policy considerations for public review and comment. After a request from a number of civil society organizations, the ADB also agreed to commission an evaluation of the safeguard policies to be conducted by the Bank’s Operations Evaluation Department (OED). A Consultation Draft of the draft Safeguard Policy Statement was released by the ADB on October 11, 2007 for a 90 day comment period.
It is expected that the ADB’s Safeguard Policy Update will result in social and environmental frameworks that closely mirror those recently established at the World Bank Group. Specifically, the ADB is considering the use of a “country systems approach” for some of its public-sector project financing and has expressed support for the IFC’s new Performance Standards (PS) for private-sector lending. In general, the ADB hopes to “improve [policy] coherence and consistency”; shift from a “procedural approach to one focused more on results during implementation”; improve policy “flexibility in application” to match “lending modalities and frameworks/capacities of its borrowing countries”; and improve internal processes and resource allocation through the Safeguard Policy Update.
Follow recent developments on the review process for the Asian Development Bank's "Consultation Draft of the Safeguard Policy Statement." (BIC website)
5. Announcements and Resources
Untying the Knots: How the World Bank is failing to deliver real change on conditionality
November 2007, Eurodad
A new report by the European Network on Debt and Development (Eurodad) find that while the World Bank may be slimming down the number of conditions it uses in developing countries, it is still making heavy use of economic policy conditionality, especially in sensitive areas such as privatisation and liberalisation. The report highlights serious concerns with the Bank’s implementation of the Good Practice Principles.
Download the full report (Eurodad website)
New Woodrow Wilson Center publication on the Asian Financial Crisis is edited by Bhumika Muchhala, BIC's International Monetary Fund program associate
October 2007, Woodrow Wilson International Center for Scholars, Asia Program
The Asian financial crisis of 1997-98 is now seen as one of the most significant economic events in recent world history. To mark the passing of ten years since the crisis, the Woodrow Wilson International Center for Scholars released "Ten Years After: Revisiting the Asian Financial Crisis," a collection of papers on the subject edited and with an introduction by BIC's own International Monetary Fund program associate Bhumika Muchhala.
Printed copies may be ordered free of charge, by sending your mailing address to: asia@wilsoncenter.org
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