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World Bank Responds to Four Demands from Mobilization for Global Justice

"http://www.worldbank.org/html/extdr/pb/pbfourdeman ds.htm

Response to Four Demands from the Mobilization for Global Justice

1. Open all World Bank and IMF meetings to the media and the public.

The Bank has opened up significantly to the media and the public -- this
applies not just to opening our meetings, but also to our new disclosure
policy, which allows for the release of more project-related documents,
information on Poverty Reduction Strategies and on adjustment lending; and
more access to Bank archives. The new policy also aims to strengthen our
Public Information Centers so that the general public in our borrowing
countries can have greater access Bank-related information.

In terms of access to our meetings, more than 600 journalists attend our
Annual and Spring Meetings each year, the Plenary meetings are televised,
and all the documents that go to Ministers are posted publicly on our
website a week before the meetings begin. During the Annual and Spring
Meetings, as we do throughout the year, Bank staff and executive directors
hold numerous discussions and consultations with groups in civil society,
including unions, NGOs and other interested groups. Last year at our
Meetings in Prague, for example, we had meetings on a range of issues with
nearly 400 civil society representatives groups who registered to attend.
Day-to-day policy and project decisions are made on the basis of
consultation with interested and affected groups in civil society. The
Bank also regularly issues press releases and hold press conferences to
update media on its policy and project decisions and on research findings.

2. End all World Bank and IMF policies that hinder people's access to
food, clean water, shelter, health care, education, and right to organize.
(Such "structural adjustment" policies include user fees, privatization,
and economic austerity programs.)

The World Bank is actually the world's largest external funder for
education, for health and for HIV/AIDS. It is simply untrue that our
policies are reducing access to education, health care or clean water. In
fact they do the opposite: they promote such access. For example, the
Bank's Multi-Country HIV/AIDS Program (MAP) has provided US$500 million to
help 12 countries expand their national prevention, care, and treatment
programs, and plans are underway to double that amount of assistance to
reach an additional 15 African countries.

The World Bank does not promote user fees for primary education or basic
health care. We agree that user fees on primary education can be a
financial burden on poor people. Where governments or communities may
elect to levy user fees, the Bank helps governments reduce the burden on
poor people either by providing target subsidies or eliminating the
charges to ensure that poor parents can keep their children in school. The
Bank also supports the provision of free basic health services to poor
people, and actively discourages user fees, particularly for programs in
immunization, maternal and child care, and certain programs for
tuberculosis, HIV/AIDS, malaria and other infectious disease, and helps
communities find alternative means of financing these programs. As regards
fees for water use, there are more equitable and efficient ways to provide
subsides to the poor than to impose low fees on all users. The World Bank
Group promotes the adoption of tariffs/user fees which target subsides to
the poorest and which maintain the incentives of the operators to extend
services to poor users, including through connection subsidies.

Bank structural adjustment lending does not uniformly promote user fees,
privatization or austerity programs – rather, it is a type of funding that
supports government programs aimed at adapting quickly to economic and
budgetary pressures while protecting key social sectors and promoting
broadly shared economic growth for poverty reduction. Between 1980 and
1998, low-income countries as a group (even with India and China excluded)
reduced adult illiteracy from 60 percent to 41 percent for women and from
35 percent to 22 percent for men; boosted the numbers of girls in school,
reduced infant and maternal mortality, and despite the AIDS pandemic,
managed to increase life expectancy at birth from 51 to 57 years. These
figures represent major development successes -- during a 20-year period
of Bank adjustment lending.

Adjustment lending was introduced in 1980 to provide temporary balance of
payments financing to member countries while stabilization and adjustment
measures took effect, but has evolved to become an important instrument
for supporting countries' own social, structural, and sectoral reforms. In
the 1990s, adjustment lending became more development-oriented, with
growing attention to poverty reduction, strengthening local institutions,
and addressing complex social and structural reforms. Adjustment lending
often includes education lending, social safety net programs or assistance
to promote good governance, such as with the Bolivia Decentralization
Programmatic Structural Adjustment Credit approved in May 2001. The credit
for Bolivia supported government efforts aimed at greater equity and
transparency of public spending for the social sectors.

3. Stop all World Bank support for socially and environmentally
destructive projects such as oil, gas, and mining activities, and all
support for projects such as dams that include forced relocation of

The responsible use of natural resources provides developing countries
with considerable opportunities for poverty reduction and economic
development. At the same time, countries, communities and companies often
face tough questions about opportunities and risks as they develop steps
to ensure environmentally and socially responsible approaches toward
mineral resource development. By their nature, extractive (oil, gas and
mining) industries leave behind a "footprint", and it is a critical step
for all stakeholders involved to work together in mitigating the
environmental and social risks involved. The World Bank Group recognizes
the potential embedded in a country's extractive sectors to significantly
influence regional and national economic and poverty profiles. Our vision
is of private sector-led extractive industries that can help create a
foundation for economic and social well-being and environmental

The World Bank Group pursues this vision by offering advice and financing
to developing country governments who want to reform their oil gas and
mining sectors towards making them an instrument for environmentally and
socially sustainable poverty reduction. Bank-financed projects support a
broad range of activities, including advice and assistance to governments
to improve their legal and regulatory frameworks. Better laws and
regulations, can, in turn, attract private investors and allow for
governments to develop institutions capable of proactively mitigating some
of the social and environmental risks often involved with extractive
industries. Bank projects are already directly investing in the mitigation
of such risks. For example, the World Bank is financing the restructuring
of coal mining industries in Russia, the Ukraine, Poland, and Romania.
These projects support the privatization of prosperous mines as well as
closure of inefficient mines, social mitigation programs for thousands of
workers, and massive environmental clean-up efforts. On a continuous
basis, and in partnership with industry groups, governments and NGOs, the
Bank works to develop more effective best practices and standards
concerning the extractive industries' impact in local communities and
surrounding environments. To learn more about the World Bank's involvement
in mining and oil and gas see www.worldbank.org/mining and

Where private sector investors want to invest in mining, oil or gas
operations in developing countries, but are deterred by perceptions of
political risk and lack of access to commercial finance, the International
Finance Corporation offers finance coupled with environmental and social
standards and guidelines. In working with private investors, IFC uses
strict safeguards and other checks to ensure that its projects do not harm
people or the environment. Projects that have benefited from IFC's
financing and environmental and social advice generate income and jobs in
many of the world's poorest countries, they help transfer skills and
technological know-how and invest in local and regional infrastructure,
including roads, electricity, hospitals, schools, and clean water. As a
result, these countries have a greater chance to break the cycle of
poverty. At the same time, many of the IFC financed projects set new and
higher environmental and social standards in these countries' extractive
industries. Environmental and social safeguard policies – considered to be
the world's best – address issues ranging from habitat preservation to the
protection of indigenous peoples and cultural property. To learn more
about the IFC's involvement in mining, see www.ifc.org/mining or

A review of the Bank Group's work in the oil, gas and mining industries
is underway and will involve NGOs, the private sector, governments and
other stakeholders. This review is headed by Dr. Emil Salim, Former
Minister of the Environment, Indonesia. We encourage interested groups to
participate in this review by going to www.eireview.org.

Energy is critical in enabling developing countries to grow, to reduce
poverty and to improve the quality of life for their citizens. The Bank
recognizes that most poor countries have significant energy and
infrastructure needs that remain unmet. Modern energy services have the
potential to free millions of women and children from the daily grind of
water and fuel wood collection. Indoor pollution from wood smoke and other
traditional fuels is recognized as a major cause of ill health in
developing countries. The provision of artificial lighting can extend the
working day, providing also the invaluable ability to invest more time in
education, health and the community. They open a window to the world
through radio, television, and the telephone, improving people's
productivity and transforming people's lives. Insufficient investment in
energy infrastructure undercuts poor countries' efforts to provide energy
for their people and for their development. Bank investment for energy
infrastructure in developing countries has declined in recent years to 5
percent of all Bank lending, a trend that is exacerbating "energy poverty"
in the poorest countries.

The Bank works with countries to explore and encourage efficient and
clean energy choices by accelerating the substitution of traditional fuels
by modern energy and promoting new energy technologies, including
renewables, by re-moving barriers to the development of their markets.

The Bank and IUCN/World Conservation Union launched the independent World
Commission on Dams (WCD) to define standards for when, where, and how dams
should be designed, constructed and operated. The Bank and its development
partners have reviewed the Report carefully. While there is much that is
useful in the Report, there are significant differences between the
recommendations of the Commission and Bank policies regarding project
preparation processes, resettlement and indigenous peoples. The Bank does
not intend to make any changes in its policies, but does concur with the
need to promote the seven strategic priorities for future decision-making
on dams, as outlined in the WCD report: building public acceptance,
assessing options, addressing existing dams, sustaining rivers and
livelihoods, recognizing entitlements and sharing benefits, ensuring
compliance, and sharing rivers for peace, development and security. While
the focus of our work with our borrowers remains on compliance with our
safeguard and other policies, this is being supplemented by assessing how
the seven strategic priorities of the WCD can be used to ensure improved
development outcomes.

4. Cancel all impoverished country debt to the World Bank and IMF, using
the institutions' own resources.

The World Bank strongly supports debt relief through the Heavily Indebted
Poor Countries (HIPC) Initiative.

To date creditors under the enhanced HIPC Initiative are delivering debt
relief to 23 countries for a value of $34 billion over time. The World
Bank itself will contribute nearly $11 billion. An additional 7 countries
could also become eligible for debt relief by the end of 2001 or early

The Bank is working hard to ensure that the benefits of HIPC debt relief
are going into fighting poverty increased spending on education and
health, rather than into military spending or off-shore bank accounts. In
the review of the HIPC Initiative conducted in 1999, NGOs and governments
alike agreed that countries receiving debt relief should demonstrate their
commitment to poverty reduction. Contrary to the statements of some debt
campaigners, the countries in the HIPC Initiative will spend much more,
not less, on priority social investments than on debt service. After debt
relief, these countries will spend about 2 percent of GDP on debt
servicing–well below that of other developing countries–compared to about
7 percent on social expenditures.

The Bank simply does not have the resources to cancel all debt without
severely curtailing its ability to lend to other poor countries. Any
decision on whether to go further on debt relief by providing more
assistance -- is for rich country governments, and ultimately for their
taxpayers. There does not appear to be sufficient political will among
these governments to forgive more debt at this time: Most rich countries
have not even come close to meeting their pledged commitments to devote
0.7 percent of their GNP to overseas aid. The average for OECD countries
is currently 0.22 percent. And unless rich countries pull down their trade
barriers and allow the poor to export their way out of poverty, poor
countries cannot fully develop.

Our demands:

We demand that groups renounce and denounce violence. This is a
prerequisite for constructive discussion and debate.

We also challenge those groups who claim to be concerned about poor
people in developing countries, yet have focused primarily on organizing
protests, to shift their energies away from conflict and toward
constructive dialogue and partnerships with the Bank and its member
governments. Attacking poverty globally and achieving the Millennium
Development Goals are immense challenges, requiring governments, NGOs,
international institutions, trade unions, businesses and other
stakeholders to work together to find and implement the solutions.
Promoting continued conflict, diatribe instead of dialogue, and efforts to
block policymakers from discussing how to address these serious issues,
only hurts the poor.

Updated September 2001

Media contact: Merrell Tuck (202) 473-9516. E-mail: