Economy
'IMF and World Bank heads need to listen to the poor' 

The World Bank claims the trip is a demonstration of its support for the region and its commitment to fight poverty and the HIV/AIDS epidemic in Africa. But most Africans are sceptical about the value of the institutions and their claim to fight poverty when they are not willing to listen to the poor. 

- From the airport they will be driven away in limousines and will hardly encounter the 'real people'," notes Kwesi Owusu of the Africa programme of Jubilee Plus, the anti-debt group.

The people that the Bank and IMF need to talk to are the ones demanding that their voices be heard by the two institutions that have driven economic reform programmes on the continent for more than two decades, he notes. "It is a significant gesture that they are going to Africa, but there has to be dialogue with civil society if they are to realise the negative impact their policies have had on the continent."

This is the first time that Bank president, James Wolfensohn and Horst Koehler, managing director of the IMF, will travel together to Africa. They will meet with African leaders in Mali and Tanzania (18-25 February) with brief stopovers in Kenya and Nigeria.

Ostensibly, the visit is to focus on poverty reduction, on efforts to combat AIDS, the need for good governance and will seek ways to boost investments to the continent. Yet no significant programmes are expected to be announced during this trip. The men say their mission is a listening one.

Wolfensohn and Koehler "are going very much in the spirit of the African tradition", says Callisto Madavo who heads the Africa division of the Bank. "You sit under a big tree, you push around ideas, you exchange views, and at the end of the day, you then say okay, how are we going to work together?"

If that is true then it will be a significant change, because since the 1980s when the World Bank and IMF stepped in to assist African countries mired in economic difficulties, they have dominated the relationship to such an extent that the IMF now micro-manages national budgets, fiscal and monetary policies in many African countries bound to it by structural adjustment programmes.

The Council for the Development of Social Science Research in Africa (CODESRIA), one of the continent's foremost academic bodies, told him that Africans had followed, to the letter, the prescriptions of his institution with little, if any reward. "Economies have been liberalised, our states' involvement in economic regulation has been reduced, public enterprises have been privatised, the dynamics of growth have been re-oriented toward the international market." 

- Our governments have progressively ceded their economic sovereignty to donors, with your institution and the World Bank in the front ranks, CODESRIA noted in an open letter to Koehler in which it asked him to walk the streets of Senegal, enter its schools and visit the hospitals to witness the failures of Washington's programmes.

But both men have promised before to listen more to the needs of Africans. Yet the continent remains marginalised in decision-making processes within the Bank. World Bank Vice-President for Africa, Callisto Madavo official told the press that there had been an evolution in the way the bank dealt with African countries and that the Bretton Woods leaders were carrying out a pact made at the 2000 Annual Meetings in Prague to put Africa at the center of their institutions’ activities.

- Really, we are continuing an ongoing conversation between the Bretton Woods institutions and African leaders, said Madavo. Madavo also emphasized an evolution in the two institutions’ dealings with Africa. "We are working with Africa very differently from the way in which we have worked with Africa in the past," he said. "We are listening more. We are leaving the space to Africans to lead their own efforts, and it has become truly a partnership that is beginning to develop in terms of the way in which we work with the Africans."

South Africa's finance minister Trevor Manuel has however been arguing that for the institutions to be more accountable and effective, borrower countries, especially in Africa, need greater voting powers. Sub-Saharan Africa only holds about five percent of the vote and its 43 members are represented by only two executive directors on the IMF Board.

Why then are Koehler and Wolfensohn going to Africa? Important political points may be scored at a time when their institutions' relevance to developing countries is increasingly being questioned.

The Bank's own 'African Development Indicators 2001' shows that average per capita gross domestic product has fallen by almost one percent during 1998-99 in Sub-Saharan Africa. The report noted a slowdown in official development aid to the continent, which peaked at 18 billion dollars in 1992 but slid to 11 billion dollars by 1999.

Moreover in 1999, the Bank and IMF launched a new structural adjustment package known as the Poverty Reduction and Growth Facility (PRGF). The new policy calls for Poverty Reduction Strategy Papers (PRSPs) which describe a country's macro-economic plans.

The rhetoric has been that the programme, through a PRSP-creation process that is participatory, gives ownership of Bank and IMF policies to Africans, as it theoretically allows all sections of a country to make inputs.

Yet when Tanzania finally brought its PRSP to Washington at the end of last year, the important decisions had already been taken by the Bank and Fund between April and June - that was when they approved the lending frameworks and programmes for Tanzania.

Charles Abugre of the Integrated Social Development Centre in Ghana recently told the non-governmental publication 'News and Notices' that in the case of Tanzania, the PRSP was a "dead letter" as there was almost nothing left for it to influence. "They want borrowing countries in the 'driver's seat', but they won't give up control," says Abugre of the institutions.

James Wolfensohn and the World Bank also needs to score points with creditor nations who finance it. While it is in the business of lending, loan levels have been falling except for programmes supported by its soft loan facility, the International Development Association (IDA). Average loan size during the last financial year was 69 million dollars compared with 93 million dollars during the 1990 financial year. IDA financing is due for replenishment by creditor nations next year and Sub-Saharan Africa has the largest number of countries in the IDA.

The Bank and the IMF are also faced with a new government in Washington following the take-over of the White House by Republican president George W. Bush who, during the election campaign last year, said the institutions needed to be reformed. Last year the Meltzer Commission, set up by a Republican Congress to look into the workings of the institutions, proposed drastic reductions in what they should be allowed to do.

The United States is the single largest shareholder at the Bank and IMF. On the Board of the IMF it holds 18 percent of the voting power. It is yet to be seen how right-wing, pro-free market Congressmen will relate to the institutions under a new government, as some have been calling for the bodies to be scrapped.

Heads of state from west and central Africa will meet Wolfensohn and Koehler in Bamako, Mali, while southern and east African leaders will have their turn in Dar es Salaam in Tanzania. Influential leaders such as South Africa's Thabo Mbeki, Nigeria's Olusegun Obasanjo and Robert Mugabe of Zimbabwe are expected to attend the meetings. 

Article based on analysis by Gumisai Mutume (IPS)

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