Bretton Woods Committee meeting Participants review measures taken to refocus IMF and promote transparency

n April 27, senior officials from the IMF, the World and economic and political reforms—the potential they OBank, and the U.S. government, and others briefed hold for humankind is incredible, and the Bretton the Bretton Woods Committee on key developments at Woods institutions and the WTO can help the world’s the IMF and the , and called for increased people realize it,” Powell said. He also endorsed the public understanding of their contributions. Speaking at value of IMF conditionality, noting that “it is only by the annual meeting of the nonprofit committee—which ensuring that countries are following appropriate, sus- is based in the United States and was organized to tainable policies that we know they will make the best advance public awareness of international financial and use of IMF resources.” development issues—were IMF First Deputy Managing Addressing relations between the Bretton Woods Director Stanley Fischer; U.S. Secretary of State Colin institutions and the U.S. Congress, Kolbe voiced strong Powell; U.S. Representative James Kolbe, who heads the support for the IMF and the World Bank. Continued Foreign Operations Subcommittee; Angel Gurría, public support, however, was another matter. Flagging Mexico’s former Minister for Finance and Public Credit, U.S. congressional interest directly reflects local con- who cochaired a recent commission on the role of mul- stituency lack of interest in the two institutions and tilateral development banks; World Bank President belief that their programs are neither vital nor beneficial James Wolfensohn; and Inter-American Development to the people of the United States. Combating these ten- Bank President Enrique Iglesias. dencies will require new political coalitions able to make a strong and effective case for the Bretton Woods institu- Refocusing the IMF tions on and off Capitol Hill, he said. Fischer reviewed the changes under way to refocus the IMF, emphasizing that promoting transparency and Support for rescue packages adherence to international codes of good practices is Gurría highlighted some of the main conclusions of a central to the new agenda. He also highlighted the recent commission he cochaired with former U.S. importance the IMF attaches to updating its armory of Federal Reserve Board Chair on the role lending facilities and its new, broad-based initiative to of the multilateral development banks. Gurría engage the private sector in crisis prevention. “In recent defended the World Bank’s involvement in financial months, the IMF has deepened its analysis of capital rescue packages. “What could be more ‘developmental’ markets as an integral part of the IMF’s surveillance than helping countries get out of crises?” he asked. activities, with the objective of contributing to crisis pre- vention,” he noted. The organization also has given pri- Poverty alleviation It is only by ority to changing how the IMF applies conditionality. Wolfensohn and Iglesias addressed the challenges of ensuring that “Notwithstanding the importance of structural policies poverty alleviation. Such efforts have borne limited countries are in the countries to which we lend, there is general agree- fruit in Latin America, Iglesias said, and population following ment,” explained Fischer, “that our conditionality in this growth continues to pose a major obstacle to long- appropriate, area has sometimes become unduly detailed and restric- term reductions in the absolute number of poor peo- sustainable tive.” The new objective is to “confine conditionality to ple in the region. But he also reminded the largely cor- policies that areas that are critical to a program’s success,” he said, porate audience that successful poverty reduction has we know they “but drawing the lines between critical and merely use- the capacity to create a larger, more broadly based will make the ful is not easy.” The challenge, he added, is to help coun- community of consumers and producers. best use of IMF tries reach a point at which their programs are both Wolfensohn’s remarks on poverty alleviation gave resources. locally owned and of high quality. pride of place to IMF–World Bank collaboration. — Citing a recent trip to sub-Saharan Africa with IMF U.S. perspective Managing Director Horst Köhler in which they met The broad tone of the meeting was set by Powell, who with 22 heads of state from the region (see IMF indicated that “the United States’s prosperity and well- Survey, March 5, page 69), he praised the joint being are linked ever more closely to expanding growth approach undertaken by the Bretton Woods institu- and stability worldwide. That is why strong U.S. leader- tions. The challenge and opportunity lie in their joint ship in the IMF, the World Bank, and the WTO [World efforts to devise more collective approaches to meet- Trade Organization] is so crucial to the United States’s ing their common objective. May 21, 2001 future and the world’s future,” he said. “Globalization, John Starrels 176 free trade, open markets, the technology revolution, IMF External Relations Department

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