It's common knowledge the International Monetary Fund, World Bank, and World Trade Organisation have a big hand in the distribution of the world's wealth, in deciding who's rich and who's not. But who are they and who controls them?
For starters 48 per cent of voting power at the IMF is in the hands of eight executive directors representing their own countries (USA, Japan, Germany, France, United Kingdom, Saudi Arabia, China, and the Russian Federation) while the other 176 member-states have 16 representatives with virtually the same voting power. At the WB the same executive nations apart from China again hold nearly half (46 per cent) of voting power. In the WTO, although all 144 member nations theoretically have a say, actual decision-making occurs in the "green room" - the small group meetings convened by the director-general and heavily influenced by Canada, the European Union, Japan and the United States. None of the countries listed above is in the southern hemisphere, and none is a 'developing' (poorer) country.
Not one member of the boards of directors in the IMF is a woman, and 92 per cent of board members at the WB are male. By convention Europeans select the director of IMF and the US government selects the head of the WB. 'Other countries and critics rightly brand the process as undemocratic and insufficiently accountable', the United Nations Human Development Report 2002 [HDR] comments.
Incidentally, to belabour the point, the five permanent members of the United Nations Security Council are USA, France, UK, Russia and China.
These decision-making arrangements are particularly important considering that eradicating, or at least alleviating, poverty in developing countries is part of the specific mandate of these finance and trade organisations. But in the past three decades or so global economic inequality has increased, and there has been very little change in the pattern of g**** poverty, especially in the hardest hit regions of the world, according to recent United Nations and other research reports.
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Today the IMF and WB lend exclusively to developing and emerging economies. Furthermore, their loans are linked to conditions that increasingly impinge on the domestic policies of the state. The result is that lending countries 'enjoy increased decision-making power and use it to expand the conditions they impose on borrowing countries, while the latter experience the conditions as externally imposed and therefore outside their own control'. [Privatisation of Bolivia's entire water supply, including rain water, by a San Fran company, for example.] This can be 'particularly worrisome' when there is considerable difference of opinion on policy advice, and when the risks associated with the advice are mostly carried by the people of the borrowing country.
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Members of the IMF do not have equal voting power. Voting weights are based on two components: each member has an equal set of 250 basic votes that come with membership, and the second component is a percentage of votes that reflect economic size. Therefore voting strength favours rich economies: the USA has 17 per cent of voting power, Germany 6 per cent, UK 5 per cent, compared with, for example, one group of 23 sub-Saharan African countries with a total voting power of only one per cent.
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erious gaps in transparency remain, reports HDR. The most noticeable are: minutes of WB and IMF executive board meetings are not published, votes are not taken and so cannot be recorded or publicized, and therefore citizens of member countries (or interested outsiders) cannot hold executive directors or their governments accountable for their policies.
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WTO claims to base its work on 'Non-discrimination, transparency and predictability' and that 'decisions are made by the entire membership, typically by consensus', but while most countries have a seat at the WTO, the backroom deals among powerful states that underpin 'consensus' have led to frequent complaints. The WTO is accused of being one of the least transparent international organizations, largely because few developing country members are able to participate effectively. In reality conclusions are reached by the General Council and major decisions endorsed at ministerial conferences held every two years.
In 2000 as many as 15 African countries did not have a representative at WTO headquarters in Geneva (where it has a staff of 560), while Mauritius, a very small country, had five.
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[P]arliamentarians and politicians seem ignorant of important WTO negotiations, even when their countries are compelled to change policies - sometimes substantially - based on WTO agreements. Recently, however, civil society groups from both developing and industrial countries have become heavily involved in WTO issues. Labour unions and groups focused on development, poverty and the environment have sought to use the WTO to further their causes. The WTO is 'feeling their influence, not so much as a result of NGO activity within the WTO but because of highly public criticism levelled against it' which, for example, closed down the Seattle meeting. In 1993 in Bangalore, India, a rally of 500,000 farmers pledged to defy the WTO's Uruguay Round agreements. Twenty-five farmers' groups in France held large protests against the WTO's agriculture agreement. Environmental and consumer groups have highlighted threats to environmental and food safety standards from WTO agreements. As a result of these and other efforts, the WTO secretariat and many WTO members have begun to work with civil society organizations more directly, contributing to dialogue on policy and negotiating processes within the WTO.
http://www.globalpolicy.org/socecon/bwi-wto/imf/2002/0925loot.htm
For starters 48 per cent of voting power at the IMF is in the hands of eight executive directors representing their own countries (USA, Japan, Germany, France, United Kingdom, Saudi Arabia, China, and the Russian Federation) while the other 176 member-states have 16 representatives with virtually the same voting power. At the WB the same executive nations apart from China again hold nearly half (46 per cent) of voting power. In the WTO, although all 144 member nations theoretically have a say, actual decision-making occurs in the "green room" - the small group meetings convened by the director-general and heavily influenced by Canada, the European Union, Japan and the United States. None of the countries listed above is in the southern hemisphere, and none is a 'developing' (poorer) country.
Not one member of the boards of directors in the IMF is a woman, and 92 per cent of board members at the WB are male. By convention Europeans select the director of IMF and the US government selects the head of the WB. 'Other countries and critics rightly brand the process as undemocratic and insufficiently accountable', the United Nations Human Development Report 2002 [HDR] comments.
Incidentally, to belabour the point, the five permanent members of the United Nations Security Council are USA, France, UK, Russia and China.
These decision-making arrangements are particularly important considering that eradicating, or at least alleviating, poverty in developing countries is part of the specific mandate of these finance and trade organisations. But in the past three decades or so global economic inequality has increased, and there has been very little change in the pattern of g**** poverty, especially in the hardest hit regions of the world, according to recent United Nations and other research reports.
...
Today the IMF and WB lend exclusively to developing and emerging economies. Furthermore, their loans are linked to conditions that increasingly impinge on the domestic policies of the state. The result is that lending countries 'enjoy increased decision-making power and use it to expand the conditions they impose on borrowing countries, while the latter experience the conditions as externally imposed and therefore outside their own control'. [Privatisation of Bolivia's entire water supply, including rain water, by a San Fran company, for example.] This can be 'particularly worrisome' when there is considerable difference of opinion on policy advice, and when the risks associated with the advice are mostly carried by the people of the borrowing country.
...
Members of the IMF do not have equal voting power. Voting weights are based on two components: each member has an equal set of 250 basic votes that come with membership, and the second component is a percentage of votes that reflect economic size. Therefore voting strength favours rich economies: the USA has 17 per cent of voting power, Germany 6 per cent, UK 5 per cent, compared with, for example, one group of 23 sub-Saharan African countries with a total voting power of only one per cent.
...
...
WTO claims to base its work on 'Non-discrimination, transparency and predictability' and that 'decisions are made by the entire membership, typically by consensus', but while most countries have a seat at the WTO, the backroom deals among powerful states that underpin 'consensus' have led to frequent complaints. The WTO is accused of being one of the least transparent international organizations, largely because few developing country members are able to participate effectively. In reality conclusions are reached by the General Council and major decisions endorsed at ministerial conferences held every two years.
In 2000 as many as 15 African countries did not have a representative at WTO headquarters in Geneva (where it has a staff of 560), while Mauritius, a very small country, had five.
...
[P]arliamentarians and politicians seem ignorant of important WTO negotiations, even when their countries are compelled to change policies - sometimes substantially - based on WTO agreements. Recently, however, civil society groups from both developing and industrial countries have become heavily involved in WTO issues. Labour unions and groups focused on development, poverty and the environment have sought to use the WTO to further their causes. The WTO is 'feeling their influence, not so much as a result of NGO activity within the WTO but because of highly public criticism levelled against it' which, for example, closed down the Seattle meeting. In 1993 in Bangalore, India, a rally of 500,000 farmers pledged to defy the WTO's Uruguay Round agreements. Twenty-five farmers' groups in France held large protests against the WTO's agriculture agreement. Environmental and consumer groups have highlighted threats to environmental and food safety standards from WTO agreements. As a result of these and other efforts, the WTO secretariat and many WTO members have begun to work with civil society organizations more directly, contributing to dialogue on policy and negotiating processes within the WTO.
http://www.globalpolicy.org/socecon/bwi-wto/imf/2002/0925loot.htm
