Supplement on global organizations
The big players in globalization have mandates that are public but not always publicized.
- The World Bank issues loans to the poorest nations. They also distribute aid from lenders, sometimes in the form of debt relief.
- The International Monetary Fund offers unconventional loans, targetting many of the same countries as the World Bank. They act as a buffer for unpredictable events in developing nations to prevent total economic collapse.
- The virtually unknown Bank for International Settlements exists to keep track of national debts. They are not structured to engage in nation building the way that the IMF and World Bank are.
- WB assets: $212 billion (source)
The World Bank loans $24 billion a year to middle and low-income countries. They are part of a renewed effort by the UN to provide $100 billion in development funds by 2010. - IMF assets: $317 billion (source)
The International Monetary Fund has a broad agenda, affecting in various ways the $130 trillion global capital market. - BIS assets: $220 billion (source)
The Bank for International Settlements keeps track of the $26 trillion in national debt between countries.
The OECD, WTO, and G8 largely represent the same group of wealthy countries. Their main purpose is to establish new trade agreements. Their influence is difficult to quantify because they don’t directly control or allocate funds.
Alex Wilks and Dennis de Tray - World Bank
Al Jazeera English
Play video part 1, part 2 (Flash, 25:00)
» Reporter David Foster interviews two development experts on the specific changes being called for to make the World Bank function better.
The actions of the IMF (and to a lesser extent) the World Bank are sometimes criticized as counter-productive. Many of their loans encourage primary resource production, which does little to build the kind of infrastructure that enables sustainable development. Through its loan programs the IMF has put developing nations at risk by opening their economies too quickly.
Jomo Kwame Sundaram - Needed Reforms to International Economic Governance for Development
Earth Institute at Columbia University
Source, Play video (Real, 17:00)
» Sundaram delivers a measured criticism of international finance, focussing on trade liberalization. The context of Sundaram’s comments is not always conveyed in this brief talk. Some background knowledge of the relevant issues is needed to fill in the gaps.
The BIS is largely invisible, taking a passive stance on development. The unique position of the BIS gives it the potential to become a stronger democratic force. The BIS could take over from the IMF in many areas, but has chosen to remain politically neutral on issues of financial reform.
The governance structure of the IMF stands out as the weakest among the three organizations discussed. The IMF has repeatedly shown an inability to update their voting rights to reflect economic change and population change.
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