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World Bank to push good governance

P. S. Suryanarayana

No new conditionalities, says Wolfowitz

SINGAPORE: World Bank President Paul Wolfowitz on Monday assured member countries that its new strategy "is not intended to be a new form of conditionality." The centrepiece of the strategy, endorsed by the multilateral Development Committee of Finance Ministers, is that the World Bank would "help" its member countries "promote" good governance and "tackle" corruption as part of an overall "mission."

Take-off point

Answering a question at a press conference, Mr. Wolfowitz said the Bank would now chart out a "sophisticated strategy" in pursuing the old principles of good governance and anti-corruption drive. The take-off point now would be "a very important new mechanism" that the Bank had instituted a few years ago "for allocating resources based on a country performance index." That mechanism itself had included "a very broad measurement of governance."

The Development Committee "strongly endorsed" the Bank's "corporate role and mission to eradicate poverty in its partnership with middle income and emerging market countries." On the Bank's engagement with India, which recently ran into rough weather over the funding of social sector projects, Mr. Wolfowitz said, "We will continue working with Indian authorities" on a range of issues including "safeguards." Most member-countries, he noted, "want to control corruption themselves and want to improve governance themselves."

On global economic growth, Finance Minister P. Chidambaram told the Development Committee that "inflationary pressures, high oil prices, a disorderly unwinding of global imbalances, and a sudden slowdown of the U.S. economy" constituted some major "downside risks" now.

"Increased threats of terrorism, including that to oil installations which can cause supply disruptions, and increased protectionism due to the collapse of the Doha Round, are added causes for concern".

Monday's meetings in Singapore were punctuated by a brief protest by a small group of people within the conference venue. The protesters asked the Bank and the Fund to "cut the aid strings" that affected poor people worldwide.

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