Odious debt roundtable report

4 August 2008 by Eurodad

The World Bank World Bank
WB
The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

http://worldbank.org
and Eurodad have published the outcome report of the recent round-table on odious debt and responsible lending. The round-table represented the first open dialogue on the issue of illegitimate debt between CSOs and the World Bank. It also involved inputs from creditor and debtor governments, academics and other experts. The report covers some of the main discussions and debates on the definition of illegitimate and odious debt, proposals for how the issue could be tackled, how to address issues of creditor responsibility, country experiences (e.g. Haiti and Nigeria) and ensuring responsible lending and borrowing practices in the future. CSOs expressed the hope that this discussion represented the first of a series of future dialogues with the World Bank on this important issue. To read the full report, see:


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