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Introduction

  • Heather Marquette
Chapter
  • 61 Downloads
Part of the International Political Economy Series book series (IPES)

Abstract

In 1997, the World Bank announced its intention to provide a ‘systematic framework for addressing corruption as a development issue in the assistance it provides to countries and in its operation work more generally’.1 This included:
  • Preventing fraud and corruption within Bank-financed projects.

  • Helping countries that request Bank support in their efforts to reduce corruption.

  • Taking corruption more explicitly into account in country assistance strategies, country lending considerations, the policy dialogue, analytical work, and the choice and design of projects.

  • Adding voice and support to international efforts to reduce corruption.2

Although the Bank acknowledged that some of these areas were new territory and would require new staff, new areas of expertise, new procedures and new lending instruments, it claimed that it had long been concerned with corruption. Indeed, a recent report asserts that the Bank has been ‘in the business’ of combating corruption, ‘since its very inception.’3

Keywords

Civil Society Good Governance Authoritarian Regime Bank Lending Legal Reform 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 1.
    World Bank (1997), Helping Countries Combat Corruption: the Role of the World Bank (Washington DC: World Bank), p. 2.Google Scholar
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    World Bank (1997), Helping Countries Combat Corruption, D. 3.Google Scholar
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  4. 4.
    World Bank (1944), Articles of Agreement of the International Bank for Reconstruction and Development (amended 1989), Internet, 4 November 1998, available at http://www.worldbank.org/html/extdr/backgrd/ibrd/arttoc.htm.
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  17. 17.
    See, for example, Nelson, P. (1995), The World Bank and Non-Governmental Organizations: the Limits of Apolitical Development (Basingstoke: Macmillan Press Ltd.); Weaver, C. (2000), ‘The Discourse of Law and Economic Development in the World Bank’, paper given at the MacArthur Conference on the Changing Role of Law in Emerging Markets and New Democracies, University of Wisconsin, Madison, 24–26 March; Fleck, R. and Kilby, C. (2001), ‘World Bank Independence: a Model and Statistical Analysis of US Influence’, mimeo.Google Scholar
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    The Bank has little leverage over those countries who borrow little from it and can find adequate private finance — such as Botswana. In addition, it has little leverage over those countries with very high borrowing levels and who also find adequate private finance — such as India and China. It is the countries in between who are the most vulnerable with regard to Bank conditionality. Caufield writes, ‘As [World] Bank officials are fond of observing — on condition of anonymity — if you owe a bank $100,000, you worry; if you owe it $100 million, the bank worries.’ Caufield, C. (1996), Masters of Illusion: the World Bank and the Poverty of Nations (New York: Henry Holt and Co.), p. 24.Google Scholar
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    Nelson, J. (1992), ‘Good Governance: Democracy and Conditional Economic Aid’, in Mosley, P. (ed.), Development Finance and Policy Reform:Essays in the Theory and Practice of Conditionality in Less Developed Countries (London: Macmillan Press), p. 310; Hoogvelt, A. (1997), Globalization and the Post-Colonial World: the New Political Economy of Development (London: Macmillan Press), p. 172; Shapley, D. (1993), Promise and Power, p. 546.Google Scholar
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    Illustrated by a 1976 quote from Henry Kissinger: ‘Disaster relief is becoming increasingly a major part of our foreign policy’; cited in De Waal, A. (1997). ‘Democratising the Aid Encounter in Africa’, International Affairs, 73 (4), October, p. 625.Google Scholar
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    In 1973, 24.6 per cent of total states were democracies, compared to 45.4 per cent in 1990. See Huntington, S. (1991), The Third Wave: Democratization in the Late Twentieth Century, (Norman, OK: University of Oklahoma Press), p. 26.Google Scholar
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    Stiglitz resigned in late 1999 in somewhat controversial circumstances, criticizing the Bank’s emphasis on growth over distribution and its use of conditionality. See Beattie, A. (1999), ‘World Bank Aid Strategy Flawed says Stiglitz’, Financial Times, 29 November; Lobe, J. (1999), ‘Stiglitz Calls for More Open Debate, Less Conditionality’, World News: Inter Press Service, 30 November; Stiglitz, J. (1999), ‘The World Bank at the Millennium’, The Economic Journal, 109 (November): F577-F597. For an interesting exposé of Stiglitz’s acrimonious departure from the Bank following these criticisms, see Wade, R. (2001), ‘Showdown at the World Bank’, New Left Review, January/February, pp. 124–37. His replacement has proven even more controversial: Professor Nick Stern, former chief economist at the European Bank for Reconstruction and Development (EBRD), whose brother, Richard Stern, is the Bank’s human resources vice president. The Bank’s rules specifically forbid the employment of close family members. This has led not only to external criticism but also to criticism from the Bank’s staff association, who warn President Wolfensohn that such an appointment could be interpreted as nepotism and may ‘ultimately demean the ability of staff to speak in a credible way with clients about corruption and hamper our work in issues of governance’. Atkinson, M. (2000), ‘World Bank Accused of Nepotism and Corruption’, The Guardian (London), 17 March, p. 28. Professor Stern was, however, appointed by Wolfensohn as chief economist in July 2000 despite such criticism.Google Scholar
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    Cited in World Bank (2000), ‘World Bank Official Warns Asia to Fight Corruption’, Development News, 14/2. Original: International Herald Tribune, 12/2, p. 12. Mamadou Dia, World Bank Country Director for Côte d’Ivoire and Guinea, told a news briefing that the Bank only dealt with ‘constitutional governments’, unless it could be proven that ‘de facto’ governments were stable and upheld international obligations. World Bank (2000), ‘World Bank Warns of Aid Suspension for Côte d’Ivoire, Development News, 4/2. Although a constitutional government need not be a democracy, it is another example of the Bank publicly choosing one form of government over another.Google Scholar
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    ‘An amendment of the Bank’s Articles of Agreement requires a formal approval by Bank members through a process which ultimately needs a majority of 60 percent of the members having 85 percent of the total voting power (80 percent in the case of IDA).’ Shihata, I. (2000), The World Bank in a Changing World, Vol. III (The Hague: Martinus Nijhoff Publishers), p. 152, note 35.Google Scholar
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    A blank space does not imply disagreement with or indifference to the approach. The Bank does identify human rights as an important issue, but de-links rights from political issues. See World Bank (1992), Governance and Development (Washington DC: World Bank).Google Scholar
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  55. 57.
    Center for Strategic and International Studies (1998), The United States and the Multilateral Development Banks, (Washington DC: CSIS Press), p. 40. It should be noted that the US Executive Director has shown no such reluctance. Indeed, the US government strongly supports the World Bank’s anticorruption initiatives and the changes initiated by Wolfensohn. See USGAO (2000), ‘World Bank: Management Controls Stronger, but Challenges in Fighting Corruption Remain’, Report to Congressional Committees, GAO/NSIAD-00–73, April.Google Scholar
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Copyright information

© Heather Marquette 2003

Authors and Affiliations

  • Heather Marquette
    • 1
  1. 1.International Development DepartmentUniversity of BirminghamUK

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