*{The World Bank and NGOs}

The NGO community is concerned about the impact of World Bank funding and 
"partnerships" with NGOs, especially those in Third World countries. Some 
charge that the Bank, with its enormous wealth, is able to "buy" small 
grassroots NGOs in the South, to gain legitimacy for its projects. Those 
sympathetic to the Bank's programs argue that this process of "dialogue" or 
"partnership" makes the Bank sensitive to the needs of people at the local 
level. 

According to Bank documents, the Bank "has made a special effort to engage 
local NGOs in its operations, given their on-ground presence and firsthand 
knowledge of the needs and interests of the poor." The Bank's engagements in 
these projects has increased rapidly, so that by 1994, 115 (about half) of the 
Bank's lending projects had provisions for NGO involvement. In 1991 and 1993, 
the rate was about 30%. In the period 1973-1988, the rate was just 6%. The 
Bank has developed a number of programs to promote "closer Bank-NGO 
collaboration." These include "social funds" to finance community-based 
projects, direct contracts with NGOs to carry out segments of loan projects, 
special grant programs and "new initiatives" including funding of NGO 
participation in international conferences. To further its work in this area, 
the Bank has set up a new NGO Unit, which maintains extensive computer-based 
files on NGOs. The Bank's Economic Development Institute also runs special 
training programs for NGO representatives. Millions of dollars are now flowing 
from the Bank into the hands of NGOs. 

The Bank likes NGOs because they are part of the "private sector" and their 
activities are often a substitute for the state. They symbolize "self-help" 
approaches to social problems as opposed to collectivist ones. But the Bank 
prefers certain kinds of NGOs over others. Judging from the NGOs it chooses to 
have a "dialogue" with, it prefers environmental NGOs to trade unions, docile 
outfits to truly grassroots groups, libertarian NGOs to socialist or 
communitarian ones. 

The Bank has now incorporated many NGOs into consultative or dialogue bodies, 
but the process got under way some time ago. By the mid-1970's the Bank 
started organizing "specialist workshops" to which it invited NGO experts on 
such topics as forestry, water and energy. In 1981, the Bank took another step 
by setting up the World Bank-NGO Committee and soon the Bank participated in 
co-financing a few local projects with its NGO partners. The major 
intermediaries on the NGO side were the Geneva-based International Council of 
Voluntary Agencies and the Brussels-based Cooperation internationale pour la 
developpement et la solidarite. Other NGOs criticised these new arrangements 
as secretive and unrepresentative and they denounced those who participated in 
the Committee. 

The Bank co-optation process moved into high-gear as the Bank helped set up a 
group of its critics (and provided them with funding!) in a body called the 
NGO Working Group on the World Bank, established in 1984. But other NGOs kept 
their distance and in 1988 organized a counter-meeting for the first time at 
the Bank-IMF annual meeting in Berlin. These counter-meetings have put forward 
very harsh views of the Bank and held tribunals to judge the social impact of 
the Bank. The counter-meetings have been held every year. 

Another vehicle for the Bank's policy dialogue is the Council of the Global 
Environmental Facility, which has a small number of NGO members. The Bank has 
also hired NGO staff, like John Clark of Oxfam, and it is increasing a program 
by which it brings NGO staff into the Bank on an "exchange" basis. There is 
even a proposal now for an "NGO funding window" at the Bank. 

The Bank stepped up its efforts on the NGO front in 1995 by sponsoring the 
Brussels Conference on Hunger and Poverty in November, along with the 
International Fund for Agricultural Development. The conference drew over 1000 
representatives of aid groups, NGOs and others. It drew up a five-point 
"action plan" which included setting up "popular coalitions" among 
international agencies, governments and grassroots organizations. The 
conference decided that the main weakness in current international and 
national actions to fight hunger and poverty is "insufficient participation by 
the poor in decisions affecting their daily lives." Critics of this and other 
Bank initiatives point out that the Bank itself, with its harsh 
"conditionalities" and interventionist structural adjustment progams in nearly 
a hundred countries is itself one of the world's most important barriers to 
democracy. Thus a "popular coalition" involving the Bank is a contradiction in 
terms. It would only perpetuate the problem, rather than solving it. 
The Bank has also sponsored regional meetings with NGOs. On 24 April 1996, the 
largest such meeting ever held in Asia brought together 70 NGOs in Manilla at 
the University of the Philippines. A considerably smaller meeting had been 
held the year before in Delhi. The Bank also organized regional meetings in 
Africa and in Latin America and the Caribbean. In all cases it tried to enlist 
NGO partners in what it calls a "policy dialogue." 

In 1996, the Bank incorporated one of its most forceful critics -- the 
Washington-based Development Group for Alternative Policies (D-GAP) -- into a 
Bank-funded program which involves substantial numbers of (mostly Southern) 
NGOs in a "review" of Bank structural adjustment policies in 10 to 12 
developing countries. This initiative, known as SAPRI (Structural Adjustment 
Participatory Review Initiative), was finally launched on 14 July 1997 
(Bastille Day) at a public ceremony. NGOs have been organized into a "Civil 
Society Network" which included some 500 organizations at the time of the 
launch. These steps give the Bank and appearance of openness and 
accountability, but in the final analysis they do not change the essence of 
power at the Bank or in the affected countries. NGOs will have to work by 
pursuasion; they will not have any direct voice in the Bank's decision-making 
process nor in its fundamental mission. 

By the summer of 1997, the participating NGOs had already grown sceptical and 
frustrated with their role. As D-GAP Communications Director Tony Avirgan 
wrote in the June issue of Bank Check: 
The civil-society organizations involved in SAPRI are not naive, however, 
about the possibilities of the exercise resulting in a fundamental change in 
the World Bank's economic policies. In fact, it is not lost on anyone that, 
while the Bank uses SAPRI to demonstrte that it is doing something on the 
adjustment issue with its critics and civil society generally, it is 
considering tightening the adjustment noose around the necks of borrower 
governments.

The new Bank President, James Wolfensohn, has proved to be a brilliant public 
relations figure and a skilled tactician. From his first weeks in office, he 
has projected himself as a dedicated reformer intent on changing the Bank into 
a different kind of institution, truly working in the interests of the poor 
and the downtrodden. He has spent considerable effort to talk to NGO leaders 
and assure them of his good intentions. But Wolfensohn like most other Bank 
presidents has a background as a profit-driven businessman. Before coming to 
the Bank, he worked as head of his own Wall Street investment banking firm. 
Bank critics point out that previous Bank presidents also began their term 
with talk of eliminating poverty, innovative approaches to development, 
empowerment of people and other such jargon. 

Wolfensohn himself noted at his first annual meeting of the Bank in the fall 
of 1995 that the number of those in absolute poverty in the world has 
increased from 1 billion to 1.3 billion in the past five years, confessing 
that the Bank's strategies have failed to improve income distribution. 
Wolfensohn's predecessor Lewis Preston also admitted that the Bank had failed 
to act effectively to stem environmental degradation. Such statements from the 
Bank's highest officials, seem to confirm NGOs worst fears. So did the 
notorious Wappenhans Report (1992). Written by a high Bank official and 
originally intended for internal use only, the report concluded that a very 
high proportion of the projects for which the Bank had made its loans had 
unsatisfactory outcomes. 

In spite of these failures and the deep opposition to the Bank's "policy-based 
lending," the Bank's power and money seem to have a substantial and growing 
influence on NGOs. The Bank has proved that it can cause splits among NGO 
coalitions between those who accept Bank funds and those who don't. To the 
extent that the Bank uses NGOs to assess the effects of Structural Adjustment 
and the extent of poverty and hunger, some NGOs may feel pressured into seeing 
the world from the Bank's perspective, rather than the perspective of their 
own members or constituents. Or at the very least they may be pursuaded to 
soften their criticism, because they come to see the latest Bank leadership as 
acting in good faith. 

As a counterweight to NGOs that are "incorporated" by the Bank, a strong and 
increasingly well-organized international network of critical NGOs has 
emerged, linking those that do not hesitate to point out frankly the 
devastating effects of the Bank, the Fund and other International Financial 
Institutions (IFIs). The "Fifty Years is Enough" network is the leading 
international network with hundreds of members world wide. At a regional level 
and national level, NGOs have also formed coalitions and networks. In March 
1995, 35 groups came together to form the Brazil Network on Multilateral 
Financial Institutions. NGOs have also formed the Latin American and Caribbean 
Network on Multilateral Banks, with focal points in Montevideo (Intituto del 
Tercer Mundo, a part of Third World Network) and in Washington (Bank 
Information Center). 

But even the most committed of the IFI critics face a serious problem: how to 
bring real accountability to these enormous, secretive and very powerful 
institutions. Some would like to demolish them, a perspective implied in the 
"Fifty Years is Enough" campaign slogan. This view has strong support on both 
the libertarian left and on the libertarian right, among those who believe in 
minimum government and maximum "free market." The reformists, who hope to make 
the IFIs more accountable, mostly focus on three strategies: (1)forcing 
greater disclosure, (2)engaging in "dialogue" and public campaigns, and 
(3)using the leverage of powerful member governments, especially through work 
with the US Congress. 

IFI activists of all persuasions have often stressed the enormous, 
undemocratic power of the Bank. Christian Aid (UK) had a 1995 Bank campaign 
entitled "Who Runs the World." No one thinks that the Bank's new Public 
Information Center (opened January 1994) will make it adequately "transparent" 
or accountable. But, surprisingly enough, few IFI activists have looked to the 
UN as a possible means of accountability and control. But there are signs that 
this perspective may be emerging. If so, the coalition for the democratization 
of the UN may gain a very important potential partner. 

*{Written by James Paul}