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A plea against the World Bank
by Eric Toussaint
16 November 2006

1) During its sixty years of existence, the World Bank has actively supported all the dictatorships and all the corrupt regimes of the U.S.-allied camp.

2) Despite having detected massive misappropriations of funds, the Bank has maintained, and even increased, the amounts loaned (see the classic case of Congo-Zaire under Marshall Mobutu after the Blumenthal report in 1982).

3) Through its financial support it helped prop up the dictatorial regime of Habyarimana in Rwanda until 1992, thus allowing the army to increase its strength five-fold. The economic reforms it imposed in 1990 destabilized the country and aggravated the latent contradictions. The genocide that the Habyarimana regime had been preparing since the end of the 1980s was effectively perpetrated from 6 April 1994, leading to almost one million deaths among the Tutsis (and moderate Hutus). Subsequently, the World Bank demanded repayment of the debt contracted by the regime responsible for this genocide. [1]

4) The Bank supported a number of dictatorial regimes in the other camp (Romania from 1973 to 1982, China from 1980) in order to weaken the USSR before its collapse in 1991.

5) It has supported the worst dictatorships until they were overthrown. For example: its classic support for Suharto in Indonesia from 1965 to 1998, for Marcos in the Philippines from 1972 to 1986.

6) It has actively sabotaged progressive experiments in democracy (from Jacobo Arbenz in the first half of the 1950s in Guatemala, to the Sandinistas in Nicaragua in the 1980s, and of course Salvador Allende in Chile from 1970 to 1973).

7) The Bank finances tyrants and then demands that their victims repay the odious debts contracted by their oppressors.

8) In the same way, the Bank has forced countries gaining independence at the end of the 1950s and early 1960s to repay odious debts contracted by former colonial powers for the purpose of colonizing these countries.

9) The Bank has given financial support to countries (South Africa and Portugal) that were under a UN-decreed international financial boycott.

10) The Bank has supported a country that annexed another by force (the annexation of East Timor by Indonesia in 1975).

11) On the environmental front, the Bank continues to pursue a productivist policy that is disastrous for populations and detrimental to nature. [2]

12) Among the projects least respectful of human rights and directly supported by the Bank is the « transmigration » project in Indonesia, many components of which may well be classified as crimes against humanity (destruction of the natural environment of native populations, enforced displacement of populations).

13) The World Bank (like the IMF) aided the emergence of factors that caused the outbreak of the debt crisis of 1982. To sum up: a) the World Bank encouraged countries to contract debts in conditions that led to their over-indebtedness; b) it drove, and even forced, countries to remove capital movement and exchange controls, thereby increasing the volatility of capital and significantly facilitating its flight. This also gave considerable leverage to speculators (failing a return to strict control of capital movements); c) it drove countries to abandon industrialization by import substitution and replace it with a model based on export promotion. The growth in exports from developing countries on the world market - where demand was stagnating - caused a fall in prices and a deterioration of terms of trade.

14) The Bank concealed risks actually detected by itself (over-indebtedness, payment crises, negative net transfers, etc.).

15) As soon as the crisis broke out, the World Bank systematically favoured the creditors and weakened the debtors.

16) Together with the IMF, it has recommended, and even enforced, policies by which the burden of debt was borne by the people, while favouring the most powerful.

17) Together with the IMF, it has continued the “generalization” of an economic model that systematically increases the inequalities between countries, and within countries.

18) The Bank has strengthened the large private corporations and weakened both the authorities of countries and the small producers. It has heightened the exploitation of workers and increased their precarity. It has had the same detrimental effect on small producers.

19) Its self-proclaimed fight against poverty fails to conceal a policy that in practice reproduces and aggravates the very causes of poverty.

20) The liberalization of capital flows, which it has systematically encouraged, has increased the incidence of tax evasion, flight of funds and corruption.

21) The liberalization of trade has strengthened the strong and further weakened the weak. The majority of small and medium producers in developing countries are unable to withstand competition from large corporations, whether in the North or the South.

22) The World Bank operates in close cooperation with the IMF and the WTO to enforce an agenda that is radically opposed to the satisfaction of basic human rights.

23) The Bank declares that it keeps up a permanent dialogue with civil society and with the poor, but this has not resulted in any positive changes in its policy. One observes repeated semblances of dialogue, in which the macro-economic framework is the dominant, unchallengeable one promoted by the Bank.

24) The Bank uses the groups made most vulnerable and deprived by its policies in order to give these policies a human and democratic face and to present them as being the conscious choice of these groups (women, the deserving poor, etc.).

25) When independent Commissions appointed by the Bank make recommendations that challenge the interests of its main stakeholders, the Bank refuses to follow them (see the report on extractive industries and on dams).

26) It systematically piles up profits during the most severe economic crises. The Bank gets richer at the expense of indebted countries.

27) It keeps these countries marginalized even though they represent the majority of its members, thus favouring a handful of governments in wealthy countries.

28) The Bank has shown its complete inability to reform itself. The appointment of Paul Wolfowitz, one of the main strategists of the criminal invasion of Irak, as president of the World Bank, only emphasizes its destructive orientation.

29) To sum up, the World Bank is a despotic instrument in the hands of an international oligarchy (a handful of major powers and their transnational corporations) who bolster an international capitalist system that is detrimental to mankind and the environment.

30) A new international, democratic institution must urgently be found to promote a redistribution of wealth and to support the people’s efforts towards development that is socially just and respectful of nature.

31) It is necessary to make a radical break with the capitalist system of which the Bank is one of its mainstays.

Eric Toussaint is the President of the CADTM Belgium (Committee for the Abolition of the Third World Debt), and author of Your Money or Your Life. The Tyranny of Global Finance, Haymarket Books, Chicago, 2005, 487 pp; co-author with Damien Millet of The Debt Scam, VAK Publication, Mumbai, 2003 and Who Owes Who? 50 Questions about World Debt, Zedbooks, London, 2004; co-author with Damien Millet of Tsunami Aid or Debt Cancellation! The Political Economy of Post Tsunami Reconstruction,VAK Publication, Mumbai, 2005.

Translation : Judith Harris.

Footnotes :

[1Eric Toussaint, 2005. Your Money or Your Life. Chapter 16: Rwanda: the genocide’s financiers.

[2Point 11, and also points 19, 22 and 24, will be developed in my next book “L’horreur productiviste”, to be published in 2007.

Eric Toussaint

is a historian and political scientist who completed his Ph.D. at the universities of Paris VIII and Liège, is the spokesperson of the CADTM International, and sits on the Scientific Council of ATTAC France.
He is the author of Greece 2015: there was an alternative. London: Resistance Books / IIRE / CADTM, 2020 , Debt System (Haymarket books, Chicago, 2019), Bankocracy (2015); The Life and Crimes of an Exemplary Man (2014); Glance in the Rear View Mirror. Neoliberal Ideology From its Origins to the Present, Haymarket books, Chicago, 2012, etc.
See his bibliography:
He co-authored World debt figures 2015 with Pierre Gottiniaux, Daniel Munevar and Antonio Sanabria (2015); and with Damien Millet Debt, the IMF, and the World Bank: Sixty Questions, Sixty Answers, Monthly Review Books, New York, 2010. He was the scientific coordinator of the Greek Truth Commission on Public Debt from April 2015 to November 2015.