Vultures in...
The World Bank
Sightings from The Catbird Seat
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From Global Exchange:
The World Bank and
International Monetary Fund
Created after World War II to help avoid Great Depression-like economic disasters, the World Bank and the IMF are the world's largest public lenders, with the Bank managing a total portfolio of $200 billion and the Fund supplying member governments with money to overcome short-term credit crunches.
But when the Bank and the Fund lend money to debtor countries, the money comes with strings attached. These strings come in the form of policy prescriptions called "structural adjustment policies." These policies—or SAPs, as they are sometimes called—require debtor governments to open their economies to penetration by foreign corporations, allowing access to the country's workers and environment at bargain basement prices.
Structural adjustment policies mean across-the-board privatization of public utilities and publicly owned industries. They mean the slashing of government budgets, leading to cutbacks in spending on health care and education. They mean focusing resources on growing export crops for industrial countries rather than supporting family farms and growing food for local communities. And, as their imposition in country after country in Latin America, Africa, and Asia has shown, they lead to deeper inequality and environmental destruction.
For decades people in the Third World have protested the way the IMF and World Bank undemocratically impose such policies on their countries. In just the last year, those protests have spread to the power centers of the developed world. In April, some 20,000 people gathered in Washington, DC during the institutions' spring meetings to demand a more democratic kind of international decision-making. Similar protests took place in Prague, Czech Republic in September of that year.
By dragging the Fund and the Bank into the light of public scrutiny, the Washington protests re-invigorated a public dialogue about the growing wealth inequalities within and among nations, and they put the institutions on notice that they can't continue business as usual.
http://www.globalexchange.org/campaigns/wbimf/
April 2, 2009
G-20 to infuse funds into
International Monetary Fund
By David J. Lynch, USA TODAY
Leaders of the G-20 agreed Thursday to massively re-arm the International Monetary Fund for its fight against economic contagion, providing significant new financing and a broad mandate for action.
President Obama and other world leaders meeting in London said they would triple the IMF's war chest to $750 billion. And they will back the IMF, effectively creating an additional $250 billion by issuing "special drawing rights," the agency's own quasi-currency that borrowing nations can draw upon if needed.
"It's much bigger than the market expected," said Marc Chandler, senior vice president for currency strategy at Brown Bros. Harriman.
But first, Congress must approve plans for the U.S. to contribute $100 billion in credit. Fund observers say they expect lawmakers' OK, after a tussle. "It will not be an easy sell," says Eswar Prasad, a former fund economist at Cornell University.
If the new IMF money is to prevent further global deterioration, borrowers must use it. Especially in Asia, where memories of the fund's "tough love" role in the 1997 financial crisis are fresh, nations are reluctant to tap IMF aid. One positive sign: Mexico earlier this week said it would seek a $47 billion credit line from the IMF.
The new initiative, along with an additional $100 billion for other lending, is expected to ease concerns about a looming financing shortage in developing countries, as global banks and other investors retrench. The World Bank says the shortfall this year will be $270 billion to $700 billion.
"If we can't get the emerging markets going, it's going to be harder for us to get out of this," said Morris Goldstein, a former fund economist at the Peterson Institute for International Economics.
Already, countries from Ukraine to Pakistan have turned to the IMF for multibillion-dollar rescues. More are expected to follow as the global recession deepens. Potential candidates include Turkey, Spain, Greece and possibly G-20 summit host the United Kingdom, said Simon Johnson, ex-IMF chief economist.
The G-20 also tasked the IMF with monitoring countries' economic and regulatory moves and opened the door to potentially historic shifts at the top of the fund and World Bank. Since their founding 63 years ago, the institutions' top jobs have been limited to Europeans and Americans. The G-20, however, says future leadership picks should be "merit-based," a signal that the next leaders could come from the developing world.
Global Fund for Indigenous Peoples
The Global Fund for Indigenous Peoples is the newest World Bank initiative that aims to directly assist Indigenous Peoples.
The Global Fund will support three activities:
1) The Grants Facility for Indigenous Peoples provides small grants directly to Indigenous Peoples' organizations to support implementation of sustainable development projects and programs based on their cultural preferences.
2) Capacity Building for Indigenous Leaders in the Andean region of South America is a pilot program designed to strengthen the indigenous organizations of the Andean countries (Bolivia, Colombia, Ecuador, Peru and Venezuela).
3) Financial support for the UN Permanent Forum on Indigenous Issues will assist the Permanent Forum to promote a global partnership among Indigenous Peoples, the UN system, the Bank and other donors.
http://go.worldbank.org/8CXAXYWB30
October 23, 2008
Nature Conservancy Named to Help
Lead World Bank’s Forest Carbon
Partnership Facility
Despite global financial crisis, member countries donate more than $160 million to stop deforestation and fight climate change
ARLINGTON, VA — October 23, 2008 — The Nature Conservancy this week was appointed to serve on the governing panel of the World Bank’s Forest Carbon Partnership Facility (FCPF) – joining more than a dozen countries from across the globe that will work together to develop the financial tools and incentives needed to make forest conservation a powerful tool against climate change. The Conservancy is the only non-governmental organization serving on the panel.
The appointment came during the FCPF’s first annual meeting in Washington DC. At the meeting policy leaders and government representatives from around the world came together to launch innovative programs and funding mechanisms that will help develop a credible global carbon credit market that recognizes forest protection.
Despite the world’s current financial crisis, FCPF members pledged more than $160 million to the Facility during this week’s inaugural meetings. With this funding, the FCPF will implement and evaluate pilot incentive programs, purchasing emissions reductions from developing countries that have taken action to reduce deforestation and forest degradation.
“It is heartening to know that despite the current financial situation, countries around the world understand that we cannot delay action on battling climate change,” said Mark Tercek, president and CEO of The Nature Conservancy. “Forest protection is one of the most cost-effective methods available to fight climate change. If we don’t take action now, climate change ultimately will have a much greater impact on the global economy and the natural resources we all depend upon for survival.”
The Nature Conservancy is a founding member of the FCPF, pledging $5 million to the partnership during the United Nations climate change negotiations in Bali, Indonesia last year.
As a member of the governing panel, The Nature Conservancy will lend its extensive experience in forest carbon projects and science to help the FCPF create the financial mechanisms and high-quality standards needed to help developing countries protect threatened forests and combat climate change.
“Right now, developing countries can generate more money from cutting down their forests than from keeping them standing,” said Tercek. “The Forest Carbon Partnership Facility will bring developed and industrialized countries together — along with forest communities, indigenous groups, the private sector and civil society — to establish a financial value for the carbon stored in standing forests.”
Also named to the governing board – known as the Participants Committee – were Australia, Bolivia, Costa Rica, Democratic Republic of Congo, France, Gabon, Germany, Ghana, Guyana, Japan, Kenya, Madagascar, the Netherlands, Norway, Panama, Switzerland the United Kingdom, the United States and Vietnam.
The Nature Conservancy has nearly two decades of experience working to reduce carbon emissions through forest protection, leading forest carbon projects in six countries on more than 1.5 million acres of land. Its Noel Kempff project in Bolivia was the world’s first forest carbon reduction project to be verified by a third party based on internationally-recognized standards.
About 20 percent of greenhouse gases emitted into the atmosphere each year comes from the destruction of forests – more than from all the planes, trains and automobiles in the world. In the next few years, scientists predict that developing countries will produce more climate-changing emissions than all industrialized nations combined – much of this due to the accelerating destruction of tropical forest resources.
But existing climate policies, including the Kyoto Protocol, do not recognize the protection of forests as a source for carbon emission reductions. So while developed nations can earn carbon credits for lowering their industrial emissions, developing nations cannot receive credits for reducing emissions from their largest source: deforestation. There is a growing consensus among world leaders and conservation organizations that credits earned through forest protection should be included in a global carbon trading market.
The Nature Conservancy supports a system of financial incentives and carbon credit markets that would allow developing nations to generate the funds needed to conserve forests, reduce emissions from all sources, protect biodiversity, improve local livelihoods and join the international fight against climate change.
The Nature Conservancy is a leading conservation organization working around the world to protect ecologically important lands and waters for nature and people. The Conservancy and its more than 1 million members have protected nearly 120 million acres worldwide.
(Catbird note: Let me see if I get this straight. The World Bank is going to give poor developing countries money for NOT harvesting their natural resources. By not harvesting their trees and using the lumber to manufacture houses, furniture, etc., the wealthy, large landowners will not need to hire laborers and thus will receive tons of money without having to do any work or pay any salaries - except to their executives, of course. Financial crisis solved!)
May 18, 2007
Wolfowitz Resigns From World Bank
By STEVEN R. WEISMAN, The New York Times
WASHINGTON — Paul D. Wolfowitz, ending a furor over favoritism that blew up into a global fight over American leadership, announced his resignation as president of the World Bank Thursday evening after the bank’s board accepted his claim that his mistakes at the bank were made in good faith.
The decision came four days after a special investigative committee of the bank concluded that he had violated his contract by breaking ethical and governing rules in arranging the generous pay and promotion package for Shaha Ali Riza, his companion, in 2005.
The resignation, effective June 30, brought a dramatic conclusion to two days of negotiations between Mr. Wolfowitz and the bank board after weeks of turmoil.
“He assured us that he acted ethically and in good faith in what he believed were the best interests of the institution, and we accept that,” said the board’s directors in a statement issued Thursday night. “We also accept that others involved acted ethically and in good faith.”
In the carefully negotiated statement, the bank board praised Mr. Wolfowitz for his two years of service, particularly for his work in arranging debt relief and pressing for more assistance to poor countries, especially in Africa. They also cited Mr. Wolfowitz’s work in combating corruption, his signature issue.
Mr. Wolfowitz said he was grateful for the directors’ decision and, referring to the bank’s mission of helping the world’s poor, added: “Now it is necessary to find a way to move forward. To do that I have concluded that it is in the best interests of those whom this institution serves for that mission to be carried forward under new leadership.”
Mr. Wolfowitz’s negotiated departure averted what threatened to become a bitter rupture between the United States and its economic partners at an institution established after World War II. The World Bank channels $22 billion in loans and grants a year to poor countries.
But he left behind a place that must heal its divisions and overhaul a flawed, cumbersome structure that had allowed the controversy over Mr. Wolfowitz to spread out of control.
People close to the negotiations said that Mr. Wolfowitz had agreed not to make major personnel or policy decisions between now and June 30. Some bank officials said he might go on an administrative leave and cede day-to-day functions to an acting leader, but that might not be decided until Friday.
President Bush earlier in the day praised Mr. Wolfowitz at a news conference but signaled that the end was near by saying he regretted “that it’s come to this.” A White House spokesman, Tony Fratto, said, “We would have preferred that he stay at the bank, but the president reluctantly accepts his decision.”
More important for the bank’s future, Mr. Fratto said, President Bush will soon announce a candidate to succeed Mr. Wolfowitz, quashing speculation that the United States would end the custom, in effect since the 1940s, of the American president picking the bank president.
Many European officials previously indicated that they would go along with the United States’ picking a successor if Mr. Wolfowitz would resign voluntarily, as he now has.
Treasury Secretary Henry M. Paulson Jr. said Thursday that he would “consult my colleagues around the world” before recommending a choice to Mr. Bush, in what seemed to be an effort to assure allies that the United States would not repeat what happened in 2005 when Mr. Bush surprised them by selecting Mr. Wolfowitz, then a deputy secretary of defense and an architect of the Iraq war.
Leaders of Germany and France objected but decided not to make a fight over the choice and risk reopening wounds from their opposition to the war two years earlier. Some also argued that Mr. Wolfowitz, as a conservative seeking to write a new chapter in a career that had been focused on national security, might bring new support to aiding the world’s poor.
Soon after Mr. Wolfowitz took office, however, he engaged in fights in various quarters at the bank over issues including his campaign against corruption, in which he suspended aid to several countries without consulting board members, and his reliance on a small group of aides.
Mr. Wolfowitz’s resignation, while ending the turmoil that erupted in early April over the disclosure of his role in arranging Ms. Riza’s pay and promotion package, will not by itself repair the divisions at the bank over his leadership, bank officials said Thursday evening.
By all accounts, the terms of Mr. Wolfowitz’s exoneration left a bitter taste with most of the 24 board members, who represent major donor countries, as well as clusters of smaller donor and recipient countries. Most had wanted to adopt the findings of the special board committee that determined he had acted unethically on the matter of Ms. Riza.
But the closest the board came to criticizing Mr. Wolfowitz was saying in that “a number of mistakes were made by a number of individuals in handling the matter under consideration and that the bank’s systems did not prove robust to the strain under which they were placed.”
Also angered was the bank’s staff association, which had called for Mr. Wolfowitz’s resignation in early April. The bank’s internal blogs were filled with denunciations of the action on Thursday evening.
Late in the evening, the association issued a statement saying, “Welcome though it is, the president’s resignation is not acceptable under the present arrangement,” and that it “completely undermines the principles of good governance and the principles that the staff fight to uphold.”
The association represents most of the 7,000 full-time employees at the bank in Washington. Their unhappiness could be a crucial factor in the bank board’s ability to heal the wounds left by the fight over Mr. Wolfowitz. It appeared likely that after Mr. Wolfowitz’s departure there would be a departure of several top aides, including Robin Cleveland, who officials said was involved in the negotiations over the statements accompanying his departure.
During the day, as word spread throughout the institution that Mr. Wolfowitz was close to a deal, some officials said that one of the obstacles was his compensation package. But there was no information Thursday night on whether he would receive any sort of severance package or pension, or be reimbursed for legal fees from his long battle.
Mr. Wolfowitz’s pay package was $302,470 in salary as of 2004 — the bank pays any of the taxes on that sum — and $141,290 in expenses. His contract calls for him to be paid a year’s salary if he is terminated, but it was unclear whether his resignation would be considered a termination as defined by the contract.
Mr. Wolfowitz’s fight for vindication was led by his lawyer, Robert S. Bennett, and negotiated at the bank by the British director, Thomas Scholar, a close associate of Gordon Brown, the chancellor of the Exchequer who is to become prime minister this summer.
For more, GO TO > > > The U.S. Dept of Justice vs. Harmon - Witness Paul Wolfowitz
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Originally posted: May 18, 2007
Latest Update: April 5, 2009, by The Catbird
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CHRONOLOGY
May 18, 2007: Originally posted on www.the-catbird-seat.net
March 13, 2007: The U.S. Dept of Justice gets Order to shut down website
April 5, 2009: Latest update on www.kycbs.net
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