Public Disclosure Authorized First Conference of the World Bank with Parliamentarians The Hague, May 28-29, 2000 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized First Conference of the World Bank with Parliamentarians The Hague, May 28-29, 2000

2 Table of Contents

First Conference of the World Bank with Parliamentarians The Hague, May 28-29, 2000

Page

Foreword 5

Program of the Conference 6

Summary Report 8 Keynote Speeches: a. Ms. Hilde F. Johnson, 14 Member of Parliament, former Minister of Development Cooperation, Norway The Role of Parliamentarians in The Fight Against Poverty

b. Mr. James D. Wolfensohn, 20 President of the World Bank The Fight Against Poverty : The Need for Action and Coordination

c. Ms. Eveline Herfkens, 24 Minister of Development Cooperation, The Netherlands The Role of Donor Countries

d. Speech of Mr. Jean-François Rischard 27 Vice President for Europe, World Bank The New World Economy and Global Governance

List of Participants 29

The Pan-European Dialogue of the World Bank 31 3 Foreword reduction hinges on a broad spectrum of policy changes and on wide participation ,engaging all of a he Conference held in The Hague on country’s stakeholders. Clearly, parliamentarians May 28-29, 2000 was the World Bank's around the world must play a role in this process. T first pan-European meeting with parliamen- tarians. Some fifty parliamentarians from 26 coun- Finally we want to create a forum for discussion in tries in Europe and the developing world attended. Europe, because both European countries and the European Union are playing an increasingly power- This was an opportunity for the World Bank and ful role in development financing and development parliamentarians to engage in an in-depth dialogue policy: both on development policy issues and on possi- ¨ they provide close to 60% of the world's bilities for further engagement and networking. We development aid; had three broad aims: ¨ they provide 45% of the resources which ¨ to inform parliamentarians about the Bank's the world's donors provide to the World Bank for role in poverty reduction and convey its readiness financing for the world's poorest countries (IDA 12); to share its knowledge resources; ¨ they play a leading role in aid coordination ¨ to exchange views on the role of parliamen- and are at the cutting edge of new thinking about tarians in international development; participation and consultation in development; ¨ to engage parliamentarians in reflection on ¨ they oversee the world's most significant future development challenges. bilateral aid budgets and also preside over the EU's At the parliamentarians' request at the end of the massive multilateral contribution to development. meeting, we decided to pursue this dialogue on a regular basis, to meet at least once a year and to On behalf of the World Bank, I would like to ex- create a network. press my sincere thanks to Ms. Eveline Herfkens and the Dutch Ministry of Foreign Affairs for their There are at least three reasons why the World Bank powerful advocacy of an enhanced role for parlia- wants to engage in a new dialogue with an interna- mentarians in development and for their generous tional group of parliamentarians. support for this initiative. Our thanks also extend to Ms. Jeltje van Nieuwenhoven, the Chairperson of The first reason is the growing place of democracy, the Dutch Parliament, for graciously hosting the and role of parliaments in development policy. In meeting at the seat of the Dutch Parliament, and to 1975, there were only around forty democracies, the parliamentarian members of the steering com- mainly in the industrialized West. Today, there are mittee - Jean-Louis Bianco, Hilde F. Johnson, virtually four times that number, and they straddle Kimmo Kiljunen, Bert Koenders, Adamou Ndam the old dividing lines between industrialized and de- Njoya, Adelheid Troescher, Bowen Wells - who veloping countries, rich and poor countries, North have been working with us in organizing this confer- and South, East and West. ence and ensuring the follow-up.

The second reason is the new global economy: issues facing parliamentarians on their home ground Jean-François RISCHARD are now no longer only national, but also global. Vice President for Europe World Bank Another reason is that while the world has moved forward, the World Bank has also changed: we have learned that reducing poverty is not just a matter of raising GDP levels in poor countries and promoting macroeconomic stability. Successful poverty

4 Program of the Conference

Sunday, May 28, 2000

7:00-8:00 p.m. Welcome address: Eveline Herfkens, Minister for Development Cooperation, the Netherlands

James D. Wolfensohn, President, World Bank

8:00-10:30 p.m. Opening dinner: The Role of Parliamentarians in the Fight against Poverty as seen by a former Development Minister

Introduction: Bert Koenders, Member of Parliament, the Netherlands

Keynote speaker: Hilde F. Johnson, Member of Parliament, Norway Monday, May 29, 2000

9:00-10:30 a.m. Opening session: The Fight Against Poverty: The Need for Action and Coordination

Chairperson: Bert Koenders, Member of Parliament, the Netherlands

Keynote speakers: James D. Wolfensohn, President, World Bank Eveline Herfkens, Minister for Development Cooperation, the Netherlands

Discussion

10:30-11:00 a.m. Coffee break

11:00-12:30 p.m. Panel discussion: The Fight against Poverty: New Approaches - New Expectations

Chairperson: Jacques Godfrain, Member of Parliament, France

Initial speakers: John Page, Director, Poverty Reduction Strategy Papers (PRSP), World Bank

Gilles Hervio, Head of Unit, Directorate General for Development, European Commission

Ted Van Hees, Coordinator, EURODAD (European Network on Debt and Development) 5 Discussion 12:30-2:00 p.m. Lunch: Global Issues: Challenges Ahead

Keynote speaker: Jean-François Rischard, Vice President for Europe, World Bank

2:15-3:15 p.m. Break-out sessions:

1. Reconstruction of the Balkans: Role and Coordination of the World Bank and the European Union in the Region Chairperson: Kimmo Kiljunen, Member of Parliament, Finland Speakers: Christiaan Poortman, Regional Coordinator for South East Europe, World Bank Ed Kronenburg, Deputy Special Coordinator, Office of the Special Coordina- tor of the Stability Pact for South East Europe 2. Africa: Economic Governance and Capacity Constraints Chairperson: Adelheid Troescher, Member of Parliament, Germany Speakers: Emmanuel Mbi, Country Director, Africa Region, World Bank Aimé Gogué, Former Minister of National Education, Togo 3. Development Challenges in the Maghreb and Global Integration Chairperson: Bowen Wells, Member of Parliament, United Kingdom Speakers: Christian Delvoie, Country Director, World Bank Ali Belhaj, Member of Parliament, Morocco Michael Köhler, Advisor, Directorate-General for External Relations, European Commission 3:15-3:30 p.m. Coffee Break 3:30-4:30 p.m. Questions to the World Bank An hour entirely devoted to questions and answers on any topic related to the World Bank Chairperson: Mats Karlsson, Vice President for External Affairs, World Bank 4:30-5:30 p.m. Wrap-up session Discussion of follow-up, frequency of the meetings, organization of the network Chairpersons: Andrew Rogerson, Special Representative to the European Union Institutions, World Bank Jean-Christophe Bas, Pan-European Dialogue Manager, World Bank

6 Summary Report THE ROLE OF PARLIAMENTARIANS IN THE FIGHT AGAINST POVERTY n May 28-29, 2000, the World Bank held its first ever pan-European meeting with The meeting began with a dinner for all participants Oparliamentarians in The Hague. Prominent on Sunday, May 28. James Wolfensohn, President speakers at the event included James Wolfensohn, of the World Bank, and Eveline Herfkens, Minister President of the World Bank, Eveline Herfkens, for Development Cooperation of the Netherlands, Dutch Minister for Development Cooperation, and welcomed the participants to The Hague. In his Hilde Johnson, former Minister for International introductory remarks, Bert Koenders (MP, the Development of Norway. Netherlands) listed four “D’s” that could guide the The meeting’s theme was the fight against poverty. parliamentarians’ efforts: de-bureaucratization, The 16 speakers included development ministers, decentralization, development, and democratization. parliamentarians, World Bank staff, European He then introduced the keynote speaker, MP and Commission staff, and an NGO representative. The former Minister of International Development of first day of the meeting began with a dinner on the Norway Hilde F. Johnson, who gave a speech on theme of “The Role of Parliamentarians in the Fight “The Role of Parliamentarians in the Fight against against Poverty.” The second day opened with two Poverty, as seen by a former Development Minister.” plenary sessions on “The Fight against Poverty.” Ms. Johnson spoke of the need to strengthen the These were followed by a luncheon address on political base for development in parliaments in donor “Global Issues: Challenges Ahead”; breakout countries. “The role of parliamentarians is crucial,” sessions on the Balkans, Africa, and the Maghreb; she said. “As a development minister you feel it and a question-and-answer session with a senior every day: if the Parliament doesn’t support your World Bank representative. The final session of the policies, you have to change them; if the Parliament meeting was devoted to discussion of possible doesn’t support your budget, you’ll get less money follow-up. for development - and for the poor; if the Parliament Organized by the European Vice Presidency gives you little attention, you have less leverage and (EURVP) of the World Bank with the help of a weight within the Cabinet...Every development steering committee of parliamentarians, and spon- minister needs the support of the Parliament to fight sored by the Dutch Ministry of Foreign Affairs, the poverty.” MPs can contribute to the international meeting took place against the backdrop of the poverty reduction effort by fighting to change Bank’s stepped-up work with parliamentarians in international structures, changing development developing and transition countries. Such work has policies, encouraging good governance, and been carried out by the World Bank Institute since substantially increasing development assistance. 1995, but analytic work related to parliaments and Parliamentarians in borrowing countries need to be some lending activity have also taken shape as the challengers of their own governments: to make them Comprehensive Development Framework(CDF)* govern better and become more accountable; to and its governance emphasis get off the ground. ensure that they adopt pro-poor policies; and to Some 50 parliamentarians from 26 countries par- make them use their positions as shareholders of ticipated in the meeting. Members of the national the Bretton Woods institutions and as members of parliaments of eleven EU member states, Norway, the UN to the benefit of the poor in their countries. and Switzerland were joined by participants from the European Parliament and from national parlia- ments in thirteen countries in Central and Eastern THE FIGHT AGAINST POVERTY: Europe, Central Asia, sub-Saharan Africa, the THE NEED FOR ACTION AND Middle East, North Africa, and South Asia. All par- COORDINATION ticipants had a special interest in the development field; some were chairpersons or members of par- The second day of the meeting opened with a plenary liamentary committees on foreign affairs and devel- session on “The Fight against Poverty: the Need opment cooperation. The forum was a non-parti- for Action and Coordination.” President Wolfensohn san initiative and participants spanned the political and Minister Herfkens were the keynote speakers spectrum. and Bert Koenders chaired the session. The full *For more information about the CDF please visit: http://www.worldbank.org/cdf/ 7 text of the speeches is attached. to remove road-blocks such as debt, protectionism, Mr. Wolfensohn’s intervention focused on the role or tied aid. The role of the World Bank should be of parliamentarians in addressing the urgent global to use its country-specific knowledge to help the issues which affect all countries. “The issues that driver read the road-map. Ms. Herfkens urged dominate every election in these contexts are short- participants from donor countries to campaign for term and local: education; local poverty; healthcare; involving development ministers (rather than finance pensions; prices of petroleum. The larger issues just ministers or central bankers) as the primary beyond the horizon-global peace, the environment, interlocutors of the Bank, so as to strengthen the trade, drugs and health-are unifying issues of a glo- poverty focus of the dialogue. bal character. In these areas, the effects of what In the discussions which followed, a parliamentarian happens in one country are transmitted to other from the Middle East noted that in order to win countries.” With the development of democracies support on global issues, it is necessary to convince (40 democratic governments in 1975, 120 in 2000), voters that the new international order is just and the role of parliamentarians has taken on a new that trade and investment will benefit developing importance and parliamentarians need to become countries. European MPs stressed the importance better informed about international issues and more of good governance and reducing gaps in income committed to the fight against poverty. The world’s distribution. One African MP raised the problems population is set to increase from 6 billion to 8 billion of military spending and the “technology gap,” while people in the next 25 years, so poverty can no longer another asked, what will happen when be treated as a poor-country issue: it is an issue of Mr. Wolfensohn leaves the Bank: will the institution global stability, of peace, and thus a matter of self- maintain its current policies? On the technology gap, interest for all countries. Mr. Wolfensohn explained Mr. Wolfensohn said it was important to deal with the Comprehensive Development Framework basic needs (water, electricity, etc.) simultaneously (CDF) which aims to improve in-country with connectivity as the latter can also serve as a coordination and ensure participation of all actors - tool to help developing countries skip stages in the international agencies, civil society, the private sector, development process. On the question of and governments - in the development process. He governance, Ms. Herfkens underlined the emphasized the importance of the technological importance of policy coherence on the part of donors revolution, and proposed that a special page for and affirmed her opposition to tied aid and tax- parliamentarians be created on the “Global deductibility for bribes. She said the changes Mr. Development Gateway,” an Internet-based Wolfensohn has brought to the Bank should be information exchange on development issues which irreversible. the World Bank plans to launch in 2001. Ms. Herfkens’ speech focused on the need for donors to improve their governance and to respect THE FIGHT AGAINST POVERTY: NEW borrowing-country ownership of the development APPROACHES - NEW EXPECTATIONS process. “The most important lesson we have learned over the last decade is that of respecting This was a panel discussion with John Page, Director, ownership. We now realize that countries must Poverty Reduction Strategy Papers (PRSP), World develop themselves, donors cannot develop them. Bank; Gilles Hervio, Head of Unit, Directorate Countries need to be in the driver’s seat,” Ms. General for Development, European Commission; Herfkens said. “That is the only way to ensure that and Ted Van Hees, Coordinator, EURODAD development will work.” Taking the analogy of (European Network on Debt and Development). development as a car, she said the borrowing country It was chaired by Jacques Godfrain (MP, France). should be in the driver’s seat: donors have a right to In his presentation on the PRSP, John Page check that the driver has a driving license, but they attempted to answer the questions, Why now? should keep their hands off the wheel and avoid What’s new about PRSP? and Will it work? He confusing or distracting the driver with conflicting noted that in the past all discussions on country advice; donors should be helpful and pay for the strategies were with governments and parliaments fuel or once in a while, if necessary, help the driver were not consulted; indeed, in many cases only to change the wheel of the car; and they should help certain members of the cabinet were consulted. 8 Gilles Hervio described some of the obstacles to governance - new fora, global public policy achieving poverty reduction, such as the lack of networks, and re-invented development institutions. political will in some borrowing countries. He He said that over the next 20 years, at least 20 urgent stressed the need for civil society to be involved in global issues needed to be tackled and suggested consultations on development strategies, but noted that parliamentarians needed to engage in discussion that civil society comprises many actors, sometimes of these issues. with conflicting interests, and that consensus can be difficult: political choices are necessary. Ted Van Hees gave a detailed analysis of PRSPs from an REGIONAL BREAK-OUT SESSIONS NGO point of view. He emphasized the need for parliaments in both donor and borrowing countries The first break-out session was on Reconstruction to monitor implementation of the PRSPs and assess of the Balkans: Role and Coordination of the the quality of the participatory process. He also World Bank and the European Union in the spoke of the link between debt reduction under Region. It was chaired by Kimmo Kiljunen (MP, HIPC and PRSP, and underlined the problem of Finland) and included presentations by Christiaan ODA budgets being used for debt relief instead of, Poortman, Regional Coordinator for South East rather than in addition to, development aid. Europe, World Bank, and Ed Kronenburg, Deputy Questions that were put to the panel focused on Special Coordinator of the Stability Pact for South some of the challenges and pitfalls facing PRSP. An East Europe. Mr. Poortman retraced the history of African MP asked why it took the donor community WB-EU coordination in the Balkans. Mr. so long to reach a consensus on poverty reduction. Kronenburg gave an outline of EU policy on the A European MP raised the question of national Balkans since conflict broke out in the former ownership of PRSPs, and suggested that countries Yugoslavia in 1991. He stressed the principles of might want to develop national strategies or ownership, partnership, and private sector “NRSPs” which would not require WB-IMF involvement, and said the three main difficulties for “approval”; they could then use shortened versions EU policy were managing countries’ expectations of these as PRSPs. John Page responded that the (e.g., of EU membership), avoiding their role of the WB-IMF Boards is to “broadly accept” administrative dependency on the EU, and ensuring the PRSPs and not to officially “approve” them. long-term stability. Discussions focused on donor Related issues that were raised included coordination in post-conflict situations; the need to conditionality (should donors impose at least an develop policies for the whole of the Balkan region, “irreducible minimum” of principles on borrowers?) not just the former Yugoslavia; and the importance and sovereignty (how can donors respect the of economic growth and job creation in building sovereignty of borrowing countries? how sovereign peace. are these countries?). The second session was on Africa: Economic Governance and Capacity Constraints. It was chaired by Adelheid Troescher (MP, Germany) and GLOBAL ISSUES: CHALLENGES AHEAD the speakers were Emmanuel Mbi, Country Director for the Africa Region, World Bank, and Aimé Gogué, During the luncheon, Jean-François Rischard, Vice Former Minister of Togo. Mr. Mbi started out by President for Europe of the World Bank, gave a discussing how to define good governance and citing presentation on “Global Issues: Challenges Ahead.” the principles: good macroeconomic policy, strategic He described two big forces which are changing the planning, application of rational systems and certain world: the demographic explosion and the new principles for budget, treasury and public finance, world economy. He went on to outline the pressures revenue collection, debt management, and good these forces are putting on existing institutions; the project management. He saw as one of the biggest new reality of struggling nation states which are losing impediments to good results the shortcomings in sovereignty over economic and environmental capacity building. Mr. Gogué urged more balance systems; the new reality of tri-sector partnerships between the executive power and others, saying that between the public sector, the private sector, and often parliaments are non-existent or very weak. A civil society; and new directions for transnational remedy would be if legislative powers could 9 adequately audit public finances. He also mentioned FOLLOW-UP other problems such as debt (which has to be repaid even for very poorly designed projects); corruption; The steering group which helped to prepare the lack of political consensus; and under-representation meeting in The Hague consulted with the participants (people’s voices not being heard). on where the initiative should go from here. Many The third session was on Development participants said how important and positive they Challenges in the Maghreb and Global thought this first meeting between the World Bank Integration. Under the chairmanship of Bowen and parliamentarians had been. They gave the Wells, MP, United Kingdom, three speakers made steering group, together with staff of the World contributions: Christian Delvoie, Country Director, Bank’s European Vice-Presidency, an informal World Bank; Ali Belhaj, MP, Morocco; and Michael mandate to come up with some concrete proposals Köhler, Advisor, Directorate-General for External on follow-up to the meeting, including the creation Relations, European Commission. Mr. Delvoie gave of a virtual network with interested parliamentarians a presentation on Algeria, Morocco, and Tunisia, which could serve as a forum for dialogue with the focusing on the five challenges that these countries World Bank. have in common: employment opportunities, social The steering group asked participants for their cohesion, EU association agreements, the link suggestions on possible follow-up. Most MPs were between poverty, employment, and growth, and the in favor of 1) setting up a network and 2) organizing need for a governance structure that takes regular meetings either once a year or once every community-based development into consideration. six months on particular themes. Mr. Köhler explained the complementarity between Several MPs made suggestions concerning the the WB and EU agendas. While stressing that the format of the next meeting, including: EC is a political body rather than a donor agency, he nevertheless noted the potential synergies ¨ Either increase the length of the conference or between the two institutions. Mr. Belhaj criticized reduce the number of topics in order to leave more the EU for lacking a strategic vision and noted the time for discussion importance of immigration from the Maghreb to ¨ Keep it informal so participants can continue to Europe. Comments from participants focused on get to know each other better the immigration issue, the challenge of globalization, ¨ Include the IMF and the need to promote investment in the region. ¨ Include more case studies from parliamentarians involved in World Bank programs in their own countries QUESTION AND ANSWER SESSION ¨ Introduce more gender equity among the speakers Following the regional break-out sessions, an hour ¨ Invite participation from the US and South was devoted to questions on any subject relating to America which were not represented on this the World Bank, with Mats Karlsson, the Bank’s occasion Vice President for External Affairs, providing the ¨ Use information technology to create discussion answers. MPs from Africa, Europe, the Middle East fora on specific themes and South Asia raised questions on subjects ranging ¨ Create regional observatories which could from how we can change the way World Bank staff monitor progress on good governance and capacity operate, to gender and regional balances in the Bank, building; link these observatories to a global network to the Bank’s anti-corruption activities, to how the ¨ Explore how international dialogue could be Bank can help developing countries benefit from facilitated, eventually in collaboration with the World globalization. At the end of the session the Bank Institute chairperson, Adamou Ndam Njoya (MP, ¨ Involve parliamentary clerks in the dialogue - Cameroon), read a poem which he had written they are more permanent interlocutors than elected especially for the occasion. representatives

The steering group agreed to:

10 1. Produce a report on the meeting and disseminate it to all participants 2. Give participants the opportunity to provide more detailed feedback on the meeting, and the future of the initiative, through a questionnaire 3. Reflect on follow-up actions and come up with a set of concrete proposals 4. Look into the practicalities of setting up a network: organizing the next meeting (venue, format, participation, content...); creating a website; funding proposals; seeing how this network could link with other World Bank groups or thematic activities; exploring possible links with other constituencies (e.g., academia).

The World Bank expressed its support for the parliamentarians’ initiative and its commitment to helping finance follow-up activities. Jean-Christophe Bas and Andrew Rogerson from the EURVP agreed to continue their collaboration with the steering group. As background, Rick Stapenhurst of the World Bank Institute (WBI) informed participants of the WBI’s existing program with parliamentarians, in particular, a series of events on “Parliaments and Poverty Reduction” which is scheduled to take place this year. Mr. Bas explained that the EURVP, which ensures outreach to a variety of constituencies in Europe, is planning to launch a similar forum with civil society and that eventually it could organize a “development forum” bringing together a range of constituencies - parliamentarians, civil society, and academia.

The members of the steering group are: Jean-Louis Bianco (France); Kimmo Kiljunen (Finland); Bert Koenders (the Netherlands); Adamou Ndam Njoya (Cameroon); Adelheid Troescher (Germany); and Bowen Wells (United Kingdom). At the general request, Hilde Johnson (Norway) was also asked to become a member. The steering group said they would welcome further volunteers, especially female MPs and MPs from borrowing countries in order to have more balanced representation.

11 Keynote Speeches The Role of Parliamentarians Although there are major variations between the Par- in the Fight Against liaments in different countries - and my impression is that the Dutch Parliament to some extent might be Poverty as seen by a former an exception - the following characteristics are Development Minister very common: ¨ Firstly, there is little knowledge and little en- gagement, development being an area for those with special interests. At least now, in the era of post- Hilde F. JOHNSON colonization and post cold-war, there is not much Member of Parliament strategic interest around, and not much "what's in it Norway for me". There is less attention, less media cover- age, and less political interest; he role of Parliamentarians is crucial. As a development minister, you feel it ¨ Secondly, there is little debate in Parliament, Tevery day: and if there is, it's usually on untying or the budget, and seldom on the content of development policies. ¨ If the Parliament doesn't support your poli- There are few questions at question time, and few cies, you have to change them; policy challenges;

¨ If the Parliament ¨ Thirdly, the development doesn't support your budget, budget is the one which is most you'll get less money for often under pressure in con- development - for the poor; nection with budget cuts, be- cause the affected are too far ¨ If the Parliament away to be heard. I think the gives you little attention, you consequence of this can be have less leverage and weight read in the figures of reduced within the Cabinet. overall development assis- tance: the OECD average ¨ Apart from a commit- dropping dramatically ted Parliament, the only rem- throughout the nineties to 22% edy is a committed prime min- of GNP, with a small turn in ister and/or finance minister 1998-99. which is important both in the internal and external battles. Why is this the case? Because being a minister is a Why the lack of Parlia- battle. From day one. Mark my words! mentary attention?

What kind of role can MPs play then in the fight ¨ The Constituency problem. The poor against poverty? Rather than answering with poli- constitituency is not capable of throwing us out of cies, and how parliamentarians can support them, I our seats; MPs tend to concentrate on the national/ want to focus on the challenge at a different level, in local issues, our own constituencies have the building the political base for development in Parlia- priority. ment. More than looking at how we should address ¨ The Academic & Technical Abstract the development challenges as MPs, I want to con- problem. Development issues are complicated. Debt centrate on how we can build the necessary sup- issues for example. All the abbreviations, HIPC, port for poverty reduction and development issues PRSP, CDF, you name it. It is difficult to under- overall. stand all the factors that have to be in place to achieve Because, what is the situation in many Parlia- results. ments, including my own ? ¨ The media problem.The media is in- creasingly dominated by eurocentrism, they be- My proposal is "a strategy for change" lieve people only care about what's near. I think in 4 points: they are wrong. The commercialization leads in addition to more soap and less coverage of for- ¨ Work on your fellow MPs: make devel- eign policy and development issues. And when opment issues interesting and attractive to MPs, e.g. , it's covered, it's the catastrophies, it's Mugabe in through seminars and prominent lectures in Parlia- Zimbabwe, it's the war between Ethiopia and ment. Encourage, facilitate and finance visits to de- Eritrea and in the DRC, it's the floods in veloping countries where they can gain knowledge Mozambique, and not the positive developments, and be engaged. So they can see with their own in Botswana, in Ghana, the peace-bonfire in eyes. Statistics never change people, never make Timbuktu in Mali, and the strides forward in them act. People do. Meeting people does. The Uganda. human face;

This lack of engagement, of Parliamentary attention, ¨ Work on the political parties: through is dangerous for development. Unless your finance links with counterparts in developing countries, en- minister or prime minister is really committed to de- gagement and involvement is created. When you velopment, to fighting poverty, you easily lose the know people, you want to assist, and you don't say battles. You might be faced with budget cuts, debt you don't care. We planned to start a program in initiatives being blocked, untying efforts brought to this direction before I left office. But on the Parlia- a halt. And so on. mentary side, make sure that it's not a partnership between two gravy trains, make sure that they meet It's dangerous, because it also affects the institutions the people that count, the poor; like the World Bank and the UN, and their capacity to act, and it ultimately affects the world's poor. ¨ Work on the media: politicians are ob- sessed with the media, and I even say this as a poli- Every development minister needs the support of tician myself! We have programs in Norway for jour- the Parliament to fight poverty. Every sensible de- nalists to encourage third world competence and velopment minister needs tough defenders in Parlia- coverage. The more coverage, the more knowledge, ment. The less sensible and competent ones need and the more interest. And that again, will affect the tough challengers in Parliament . And those defend- political priorities. It's sad, but it's true, and we have ers or challengers should be in as many parties as to act on it; possible. One has to constitute and construct a solid political base across party lines in support of the ¨ Work on the electorate, which is the most cause. important, through information and education; that's where it all starts, schools and campaigns, that's How can we create this political base, how can where the high Norwegian support for development we recruit such defenders and challengers? And assistance comes from. Incredibly high scores, over how can we turn disinterested or less commit- 90 % support among youngsters (e.g., Operation ted MPs into engaged ones? Day's work and our development assistance to the US, through launching the campaign there, export- My answer is: ing solidarity is much more important than exporting salmon!). Work on the youth organizations, they are Bring the likeminded and engaged MPs together, in crucial, and build partnerships to strengthen the soli- individual Parliaments, across Party lines; create your darity movements (NGOs). own global forums or development groups. And bring them together also across Parliaments, as you All these efforts will contribute to strengthening the have done here. This is a good first step. Create a political base for development in Parliament, and thus strategy for change, internationally and nationally. also for the fight against poverty. And they should take place simultaneously.

14 Ali Ashraf, Imran Ahmad, Manuel Pinto Hilde F. Johnson, Bert Koenders, Eveline Herfkens

James D. Wolfensohn, Eveline Herfkens Ted Van Hees, John Page, Jacques Godfrain, Gilles Hervio

Adamou Ndam Njoya, Mats Karlsson Bowen Wells, Tony Worthington, Inonhe Mbikusita Lewanika

Eveline Herfkens, Bert Koenders, Kimmo Kiljunen, James D. Wolfensohn James D. Wolfensohn 15 Adelheid Troescher, James D. Wolfensohn Jean-François Rischard, Matthew F. Mc Hugh

Baroness Emma Nicholson of Winterbourne, Famara Sarr, Ali Belaj, Christian Delvoie James D. Wolfensohn, Jean-Christophe Bas

Rudolf Dolzer, Claudia von Monbart, Marianne Samuelsson, Tess Kingham James D. Wolfensohn

Mamadou Lamine Thiam, Famara Sarr, Tytti Isohookana Zlatko Lagumdzija, Christian Poortman, Mats Karlsson 16 Asunmaa, Paula Kokkonen, Ali Belhaj, Atanas Paparizov The Parliaments in our respective countries are crucial to decisions on development. In addition, We are at a crossroads right now, at a crucial the presidential, prime ministerial and finance moment in history. It's the year 2000, and we have ministerial candidates are also recruited from this 15 years to do the job. To fulfill our commitments. same group. In a long-term perspective, there- And it is possible, if we do the right things. fore, such efforts are a wise investment, which will bear fruit and which will directly affect de- How can we make it happen? How can we reach velopment policies and budgets. The efforts put these seven pledges? into poverty reduction. I think four factors are important here: Why should we act as Parliamentarians? Why should we create this strategy for change? ¨ Through fighting to change international structures, increasing debt relief, trade and invest- ¨ Firstly, we live in an age of globalization. ment; through sufficiently financing the reformed We have to get rid of the illusion of isolation, isola- HIPC; through making the new WTO Round the tion from the world's problems and the world's poor. Development Round, making trade and investment It's not possible anymore. Interdependence is our work for the poor, and not against the poor; new reality. Almost every part of the world is now our "neighbourhood". There is no longer any such ¨ Through changing development policies, in- thing as "far away". We are in it together. Environ- creasing donor coordination, e.g. , through the CDF, mental problems know no borders, neither do the through lowering national flags, untying aid etc., and refugees, or others fleeing problems of security, targeting our assistance to the poor; safety, poverty. They reach us. Again, we are in it together. ¨ Through encouraging and assisting govern- ments to govern better, adjusting macroeconomic ¨ Secondly, the poverty challenge. It is a policies and making them pro-poor, and through moral imperative. It is unacceptable that 30 percent well-functioning and nationally owned PRSPs; of the world's population still have less than a dollar a day to live on. That is around 1.4 billion. And the ¨ Through increasing development assistance numbers are continuously increasing, so mine are substantively. probably outdated already. If we continue with our efforts on the same level as today, the situation will All four factors are crucial to fight poverty. And it is become worse. Because of the population increase, possible. An alliance of development ministers and within ten years from now and maybe less, we may heads of institutions like the World Bank, several of be faced with a situation in which 2 billion people the UN organizations, have made things happen have to manage with under a dollar a day. That is already. A powerful alliance with their focus on the why we need to intensify and increase our efforts. poor have created new optimism. Among them also Status quo is not enough. We have to do more. Much the Utstein group. And rightly so, the decline of ODA more. has now turned, with a small, but still symbolically significant increase. And we have already promised to do so. Govern- ments representing most of the countries in the world Two of these players are here with us tonight. And - and us as MPs- have pledged to halve the num- I want to give them a special tribute, in the very im- ber of poor living in extreme poverty by 2015. We portant role they have played in bringing the devel- have dedicated ourselves to goals like providing uni- opment agenda forward, and in fighting poverty, versal education and reducing child and infant Eveline Herfkens and Jim Wolfensohn. Let us give mortality by two thirds by 2015. Just to mention but them a special round of applause! a few. These pledges, seven altogether, have been established by a number of UN conferences. Our We as Parliamentarians are one of the most joint responsibility is to lift more than one billion important bases for political action. They can- people out of poverty in only 15 years. not do much without our support.

17 in relation to better governance. It undermines But it doesn't help much either if we, as MPs and everything we do. It's a major obstacle to devel- politicians, fight in our own Parliaments if the MPs opment; among our partners in the poor countries don't do the same. I'm glad to see that there are several of ¨ Self-interest among donors is the fourth you here. You also have a crucial role to play in fighting and not least important obstacle. If the donors con- poverty, in being challengers of governments and tinue serving their own interests rather than the in- defenders of the poor. I would say, maybe along terests of the poor, we get poor - and even worse - three lines: results. The donors have to change their practices and they have to get rid of their self-interest. ¨ Challengers of governments to make them govern better, making them accountable, demand- Development ministers, development institutions and ing good policies, good macro-economic policies developing countries cannot achieve these goals specifically, good governance, and not least, fight- without backing in Parliament, without engaged Par- ing corruption; liamentarians, taking on the role of defenders and challengers. Committed to fighting poverty. Without ¨ Challengers of governments in defending the us it cannot happen. poor, demanding pro-poor policies, priority of health and education, focusing not only on the urban elec- Therefore, let us make a strategy for change! Change torate, but on the needs of the rural poor, who sel- among MPs. A new coalition, a new alliance , dom are given priority, and the urban poor, who are often forgotten. Be defenders of the poor; To make as many of us as possible Defenders of Development, Defenders of the Poor: ¨ Challengers of governments to use their po- Of Jacob and Agatha in the cornfields of Tanzania; sitions as shareholders of the Bretton Woods insti- Of the starving Joseph and Celastine, 3 1/2 years tutions and as members of the UN to the benefit of old , in the dry lands of Ethiopia; your own people, for the poor, and not the oppo- Of the victims of the wars in the Balkans; site. There are so many examples of countries pur- Of the suffering street children in Brazil; suing policies internationally that are counterproduc- Of the crying mother who lost her fifth child in labor; tive, they pretend they are defending the interests of Of the world's poor. poor countries, but often their policies affect the Let us become their Defenders. poor more. This is not least the case with the UN. To make the seven pledges a reality 15 years from There is a need for change also here. now - in 2015.

Together we have to fight the four major obstacles to poverty eradication, obstacles to succeeding in reaching our goals. They are:

¨ War: without peace, development is not possible. Look at all the wars we see now. Together we have to work for peace and reconciliation.

¨ The HIV/AIDS-pandemic, one of the worst obstacles in Sub-Saharan Africa, setting countries with good development results many years back, for example, reversing the average age from almost 65, as in the case of Botswana, to around 47!

¨ Corruption: corruption is stealing from the poor, and it runs counter to everything we work for

18 The Fight Against Poverty: are hardly being mentioned in the current debates between George Bush, Jr. and Al Gore. The envi- The Need for Action and ronment and global warming are only discussed be- Co-ordination cause they worry the public. Parliamentarians and other local elected officials have a terrific responsi- bility to bring real and global issues to the attentions of their publics, even though they know that they may not generate votes. You must rise to this major, James D. WOLFENSOHN crucial challenge. President World Bank II. Mastering a Changing Situation These issues are not simply static. Rather, they are strongly dynamic. Within the next 25 years, the 6 billion people who currently inhabit the Earth will he issues that we face no longer allow become 8 billion. The 4.8 billion people who cur- people to think in terms of developed or de rently live in the developing world will become Tveloping countries. Rather, we must face glo- 6.8 billion. 97% percent of the next two billion of bal issues. the Earth's people will live in transitional or devel- oping economies. This will constitute a significant I. The Role of Parliaments challenge for younger parliamentarians. I doubt that This change is difficult for many parliaments because I will be present to witness these changes. None- the issues that these bodies face are typically na- theless, echoing Hilde Johnson words yesterday tional. The European evening, the decisions elections, elections in that you make will sig- developing countries, or nificantly impact the the current elections in number of people living the United States in poverty. scarcely ever cover is- Poverty is not only a sues that relate to devel- social or ethical issue. It opment or to interna- is a matter of peace. In tional stakes. The issues analysing the factors that that dominate every shape instability around election in these con- the globe, one almost al- texts are short-term and ways finds basic eco- local: education; local nomic problems. A se- poverty; healthcare; ries of questions will in- pensions; prices of pe- form our global outlook. troleum. The larger issues just beyond the horizon- Will the 3 billion who live in poverty become 4 bil- global peace, the environment, trade, drugs and lion? Will people be able to go to school? Will health-are unifying issues of a global character. In there or will there not be economic opportunities? these areas, the effects of what happens in one coun- How will riches be divided? try are transmitted to other countries. The prob- Today, we know that problems of instability and lems themselves are not easily grasped, but they ex- poverty can easily "infect" neighboring countries. ist and they unify insofar as they are global. This infection is facilitated by the state of communi- With the rise of transnational forms of communica- cations. It is also facilitated by international terror- tion like the Internet, television and radio, the extent ism, which can inflict anguish on a country with a and implications of these global issues are becom- vial of biotoxic material or a small atomic bomb. ing more known and more significant in national de- The apartments that were blown up in Moscow, the bates. Nevertheless, few national leaders are threat to the World Trade Centre in New York, and elected on the basis of international issues. They the current ongoings in the Philippines are all proof

19 of this. Our major problem lies not in the raising of IV. International Institutions: The Need for Co- armies, but in the world's inherent instability. We ordinated Action are witnessing global movements, fundamentalism International institutions like the World Bank face of all sorts and patterns of migration from one place certain constraints in carrying out their tasks. Some to another. are those that Hilde Johnson outlined last night: debureaucratising, decentralising and development. III. Rallying the People We are trying to make our institution much more These are issues which do not appear on local agen- global. Along the way, we have learned a few les- das but which will inevitably have to be confronted sons. Fifty years ago, the International Monetary over the next 25 years. The situation is urgent. There Fund and the World Bank were the reigning centres is no sense in waking up 25 years from now only to for multilateral activities. We are today small in the discover that the world has become overridden with overall scheme of things. We are a part of the inter- unpleasantness. It is urgent that we work now to national multilateral development community, which create and begin to implement some kind of equity now involves over USD 50 billion in transfers per in global development over the next 25 years. This annum. The Bank is the largest single component of is not merely a matter of conscience or of moral this community. We are now joined by the UN sys- principle, although those stakes would be sufficient. tem itself, by regional banks, and by highly signifi- It is a matter of self-interest. Questions of self-in- cant bilateral agencies, some of which are repre- terest are very appealing to voters. They will act sented in this room. While I am in Holland, I should once they understand that issues that concern them pay tribute to the Dutch people and government for directly are no longer national, but are global. the bilateral assistance they offer. The views I am presenting are not "mad philoso- Today it is no longer possible for the Bank to sit phy" from an international civil servant. I have now atop a mountain and wait for others to come to it. been to over 100 countries and have visited with Bank activities must be co-ordinated and integrated members of parliament in almost every one of them. with all the international institutions. However, we I have also travelled through them all. I have just have found that we cannot restrict our activities to come from a three-day trip to Turkey. Turkish is- these international institutions. We also need to build sues are critical to Europe: what happens there should consensus in civil society. To this end, the World matter to us all. Political life is subject to strong Bank now reaches out to religious organisations, trade fundamentalist pressures. The state is non-religious, unions, and parliaments. The latter are particularly but fragile. The decisions that you make on assis- important because, by virtue of their having been tance to Turkey in education or economic develop- elected, they represent the desires of civil society. ment will not appear to be very important to your local electorate. However, they will have an impor- V. National Participation tant impact upon Europe. In my meetings with the Since 1975, the number of formal democracies has Turkish Parliament, I tried to show them that their increased from 40 to 120: five of the world's six local actions had global implications. Similarly, the billion people now live under some type of demo- issues with which I dealt earlier in the week (Gaza, cratic process. We now see the emergence of a new the West Bank, Jordan and Iran) had implications force in these parliaments. While each represents for stability in both local and global contexts. "the will of the people", they can take on many dif- Global issues can no longer be avoided: they are ferent forms. In India, representation begins at the present and must be attacked. Unfortunately, we level of the villages, while in other countries, a more rarely have informed parliamentary bodies or in- centralized system has been adopted. formed leaders. In my judgement, you who attend The parliamentary impulse is becoming crucial in this conference on international poverty and its eradi- donor and recipient countries. Insofar as we deal cation have entered a field of utmost importance. with governments, the money that we distribute has This is not because it is a luxury to have extra inter- to be channelled through governments. When work- est in international issues, but because it is funda- ing in democratic systems, the constitutions of the mental to each and every one of your countries. countries involved require that we work with Par- liament. This is true for both donors and recipients.

20 However, we have discovered that the underpin- Ghana or in any other country. We have come to nings of knowledge and experience are frequently recognize that, unless the project is owned by a coun- missing in these bodies. Within the US Congress, try, we have no chance of making it effective in the only 12 to 15 people know anything about the World long term. Bank. The other factor is the building of constituencies The same problem arises in other countries. People within the countries themselves. We have learned do not understand that the problems faced by the that projects centrally owned by the State are less World Bank are not fringe issues, but are funda- effective than those held through a more diffused mental to stability, development and growth. For form of ownership that sometimes extends to the example, in terms of practicalities of finance, the community level. I am personally convinced that developing world now represents 18% of the world's the challenge of the next 2 billion people will only be GDP. That figure will rise to 30% in another met if we look at poor people not as objects of our 25 years. In economic terms, growth in trade, de- charity, but as assets to be used to bring about de- velopment, and the creation of jobs should be strong velopment. We must learn to engage the people priorities over the next 25 years. Your action is com- whose lives we are trying to affect. We must recog- pletely in line with this reality. You are leaders. We nize that only they know what is happening in their must now try to develop deeper connections be- localities, and stop trying to impose project man- tween the Bank and parliamentary bodies. agement on a top-down basis. I could cite dozens This will not be easy in many countries, where we of examples, had I the time to do so. deal more with the authorities than with the Parlia- The USD 50 billion that we contribute to develop- ment. If I try to set up a meeting with a national ment assistance are dwarfed by the parliament without checking first with the Finance USD 250-300 billion set forth by the private sector. Minister, I am likely to have my head handed to me. Growth led by the private sector is now the central In many countries, the relationship between the ad- economic force in bringing about the more general ministration and the Parliament is uneven or uncer- growth that is required for development. At present tain. The mechanisms that we need to use must be we have managed to bring international agencies, carefully assembled. If I begin dealing with a de- civil society, private sector and the local governments velopment committee appointed by a certain parlia- into the arena. The latter play the leading role. We mentary body at a time when I am having a conflict have learned that it makes no sense to throw money with a Development Minister, the whole situation be- at a country unless it has established a framework comes immersed in a local debate. The question of within which we can operate. Neither donor nor how to bring parliamentarians into the process must recipient countries can gain from financial contribu- be considered. While I have no doubt that they tions if they lack governance, properly trained people, must be included, I question our present methodol- a legal system, a judicial system, a financial system ogy. Ministers or administrators sometimes want to and ethical principles. The aid dissipates. I can give keep the Bank far from what they call "the political you many examples of this, and I am sure that you level of activity". know of many as well. This new framework situates institution-building and VI. The Comprehensive Development reform as another set of pre-requisites for develop- Framework ment. It is intertwined with the policies we have Our thinking about development projects has moved established in the fields of education, health, trans- from a more narrow to a more inclusive view, and port, rural policy, environment and culture. We be- has given rise to the Comprehensive Development lieve that all of our work should proceed through Framework. It involves not only ourselves, the this comprehensive framework. This is what we are NGOs, parliaments and religions, but also two other now doing. At some point, I would urge you to crucial "players". The first is the government with look beyond the development programs in which which we must operate. There is no sense in orga- you might be involved to this medium and long-term nizing World Bank projects in Chile. The Chilean comprehensive framework. government must organize projects to which the World Bank can contribute. The same is true in

21 VII. The Technological Revolution you so that, as you move forward, ideas that you Finally, I would like to mention the latest develop- may have will not be relegated to a few meetings ment in society. Its importance is even greater than per year. For the first time, parliamentarians will be that of the subjects mentioned previously. During unified around centres of interest. This will enable my last trip to Korea, Thailand, Indonesia, East you to work together and to move forward on a Timor and Vietnam, I found that the top priority in variety of issues.This is simply a sketch of what we the minds of every leader was the technological revo- are currently preparing. The Bank is present to serve lution. Even in East Timor, I was told of the impor- you and has an enormous base of information at its tance of distance learning and other aspects of disposal. We have a very strong desire to work Internet technology. During my last trip to Turkey, with you. We are looking forward in the most ear- we talked about technology. It is no longer a gloss nest manner to help you in your efforts. We know or a luxury. It is not limited to those who are lucky that the partnership that we have begun to develop and rich. The technological revolution has succeeded today will be crucial to the fight against poverty. those in agriculture and industry. It is central to ques- tions of development in the future. It opens up enor- mous possibilities, but also brings with it the most enormous challenges. The Bank links over 100 of its offices by satellite. We currently run 400 videoconferences per month and this number is rising exponentially. These con- ferences begin at 7 a.m. and continue late into the evening. We are looking into 50 distance learning facilities that would enable us to connect twelve dif- ferent locations simultaneously, either for discussions or lectures. We are now building what is known as the "global gateway". I hope that this will be of interest to all of you. It is an attempt to bring together international and national institutions in order to gather all of the information that pertains to development. From is- sues in education to contemporary history in Bo- livia, all of the information that may be of interest to users will be found on the gateway. It is an oppor- tunity for us to implement co-ordination and trans- parency. It has almost infinite potential not just as a technological trick, but as a methodology that can substantively bring us together. A page for mayors has already been built into the prototypes that we are developing. The gateway itself will be launched by the first quarter of next year. Currently, every Saturday morning, we link for discussion and teach- ing sessions with more than 300 mayors of towns and villages in seven Latin American countries. The mayors' page that we are developing will enable mayors from around the world to link with and talk to each other. We are now looking into a parliamentary page that will enable parliamentarians to know what is going on in the development field. This tool has never been available before. We want to develop it with

22 The Role of has been reached in terms of what course of action to take in the fight against poverty and how to di- Donor Countries vide up the responsibilities. The World Bank and the IMF have now joined that consensus and are committed to meeting the seven pledges that Hilde Eveline HERFKENS Johnson outlined last night. We no longer have to Minister for Development Co-operation waste time and energy on these ideological debates. The Netherlands We must move toward implementation. As active participants, we must improve our governments and policies in order to make the seven pledges become hen I was a parliamentarian, we used to realities. meet in this room. About a decade ago, Ongoing debate has given sufficient attention to the Wwe were moved to a different location. ways in which recipient countries can improve gov- Nonetheless, many of our important debates took ernment. Let me say a few words about the need place here. Thus, it is with some nostalgia that I for donors to improve governance. What would be look around here. the ideal type of development partnership?

I. The Development of International Debate II. Respecting Ownership I recall that we had very passionate debates. I re- The most important lesson we have learned over member one ex- the past decade is ample in particular: that of respecting I was fighting for ownership. We donors to give in- now realise that creased attention countries must to basic education develop them- and health for girls selves-donors in particular. At cannot develop that time, in the them. Countries middle of the need to be in the 1980s, a conserva- driver's seat. That tive minister told is the only way to me that I was try- ensure that devel- ing to export so- opment will work. cialist-welfare state The older ideas to developing method, known countries, which as bilateral aid, could not afford consists of adopt- this type of over-blown government nonsense. Ten ing a province or a village and trying to create a years later, by the middle of the 1990s, the then- paradise within a sea of misery. It is not effective chief economist of the World Bank, Larry Summers, and is not sustainable in the final analysis. Only if made the statement in Pakistan that the country's we work together with the country concerned is it best investment was in sending girls to school. I find possible to bring the seven pledges closer to reality. it typical that the subjects that were debated during Naturally, the fact that we put someone in the driver's the 1970s and 1980s about international poverty seat does not mean that we cannot check his or her are now subject to an overarching consensus. license. There is much debate about improving gov- My years in parliament were marked by debates ernment. On the recipients' side, in the South, par- between North and South, Left and Right. So much liamentarians have a tremendous amount of progress energy was wasted on these ideological debates. I to make. Donor countries are empowered to check am pleased to say that, over the years, and in part whether the recipient has a license, and to be sure thanks to a lot of UN summits, a basic consensus that those governments which we support are in fact

23 working to eliminate poverty. The same occurs with cattle farming in Botswana. Once we have ensured that the proper infrastruc- The Netherlands has been very helpful to a group of tures are in place, we must be very modest in our Egyptian farmers in sponsoring the development of role as a donor country. We must keep our hands irrigation technologies to help them increase their off the controls so as to avoid confusing or distract- production of citrus. However, an EC agreement ing the driver. Members of the donor community with Egypt prevents citrus from entering their mar- have a habit of giving advice and subjecting recipi- ket. Thus, while these farmers have finally become ents to a cacophony of opinions. This is not helpful, successful, they cannot export. We must face these especially since every donor has different proce- trade issues. They truly prevent development from dures. Countries like Zambia received hundreds of occurring. If these programmes are the only way in missions per year. This means that ministers must which a country can receive foreign exchange, they spend substantial portions of their time wining and serve no purpose. Instead, they confirm aid depen- dining these missions. The governments spend even dency. Exporting to international markets is a way more time studying many different procedures for out of this dependency. disbursement, procurement, auditing and reporting. All this distracts the governments from doing what IV. The Role of the World Bank they should be doing: running their countries, con- We must realise that the World Bank is the premier structing and implementing good education policies, development institution that is available to the inter- etc. I would call upon all of the donor countries to national community. We should make better use of harmonise their procedures, and, particularly, to stop it. There is a role for the World Bank in reading the tying aid. Tying aid is the worst kind of donor prac- map. The Bank's brilliant staff of 10, 000 people tice: it reduces the quantity and quality of aid, and could be extremely helpful in advising developing distorts the priorities of the country concerned. countries on the road which they have to take to reach their goals. Concretely, the World Bank has III. Eliminating Obstacles to help countries translate the principles of the Com- Instead, the donor community should work on clear- prehensive Development Framework. In a parlia- ing away roadblocks. mentary debate of a few days ago, I was criticised for being too positive about the World Bank. 1. Debt 1. From Theory to Practise One such roadblock is debt. It is impossible for a Many members of Parliament are concerned that, country with a huge debt overhang to develop un- while the conceptual views elaborated by the Bank less we take away that debt. Finally, thanks to the are terrific, they are not necessarily translated into personal commitment of Jim Wolfensohn, there is a reality. It is normal that a large institution take some consensus and an initiative. Nonetheless, I would time to translate policy changes into actual method- like to ask you to check with your government to ology. In this case, there is a sense of urgency and a see whether the commitments that your country growing impatience. I know that Jim is personally made last fall have yet been dispersed. Did your committed to this. The World Bank must increase governments actually pay? So far as I know, the its efficiency by offering country-specific advice. initiative is still on the table, but the promised money Ten years ago, the first World Development Report is not there. It remains under-financed. on Poverty was published. At that time, I criticised 2. Protectionism it because it focused too much on social sectors and Protectionism is another block. It is impossible to not enough on methodology (making growth more discuss development without pointing out that labor intensive, shaping policies that truly benefit the industrialised countries pull the rug out from the very poor, sequencing macro-economic policies in order countries which they help by blocking their export to increase the positive impacts upon the poor and commodities. We have been helping farmers in Tan- to control for the negative, designing pro-active zania to increase milk production. At the same time, policy). The World Bank is now doing wonderful as a result of subsidies given by the EC, the Tanza- work on these points. The coming World Develop- nian milk market has been destroyed and these poor ment Report on Poverty is a clear advance in the farmers cannot sell their milk. conceptualisation of these issues. It is now most

24 important that this kind of thinking escape the glossy US does have a fairly large vote, but that vote is confines of the World Development Report on Pov- irrelevant insofar as most day-to-day operations are erty and be converted into country-specific advice authorised on the basis of simple majority and the on implementation. US cannot stop them. The idea that the US runs the 2. Addressing Gender Issues establishment, an idea about which Europeans are Gender is another issue that must be more seriously often frustrated, is not true. Europeans have more conceptualised at every level of this debate. We all votes than the US. The only factor that makes the know that the face of poverty is a female face, and Bank somewhat American is the fact that its head- that development policy is simply less effective with- quarters are in Washington. The institution should out a consideration of gender. probably move its headquarters to another country, perhaps in Europe. In many ways, the Bank is mov- V. Dispelling the Myths ing to other countries as it opens up offices in bor- I would like to end by addressing three myths rowing countries. This is a salutary move: it is right about the World Bank. There is much debate that the Bank moves out into the field to learn more. about the nature and role of the World Bank, much of which is misguided. The World Bank is not a bank, but a development 1. "The World Bank is so powerful that it is not institution. The heart of the Bank is IDA (Interna- under anyone's control." tional Development Association), and when we in People do not seem to realise that the Bank is gov- Europe talk about the Bank, we mean IDA. That is erned by a Board that micro-manages the agency in the part that we care about. One problem with IDA ways that far exceed what goes on in any UN for- is that its charter used to tell it only to communicate mation. Every one of you has a representative on with finance ministers and central bankers. How- the Board: either your country elected one, or it ever, the Bank has undergone significant changes appointed one. I feel that parliamentarians could under the direction of James Wolfensohn: it now do a better job in making these people accountable. communicates with civil society as well as with par- The Bank's power is always overstated. It is pre- liamentarians. Thus, although the charter is a handi- sented as if the recipient has no say. The World cap, the Bank's work on the ground is much more Bank cannot force anyone to take money. It is only inclusive. in the poorest countries that there is a bit more le- The entire CDF is an inclusive exercise. On the verage. However, it is in these same cases that the donor side, there is more room for improvement. In bilaterals team up with the World Bank. The huge the past, IDA was perceived as being of concern to dam projects in India are one example. The Bank the Finance Ministry or Treasury alone. Over time, works to minimise the negative impact of the project, specialists in development began to become in- which is undertaken by the government of India. Do volved. During the 1980s, the Netherlands and Ger- not blame the Bank for projects initiated by govern- many determined that IDA was a development is- ments. sue, changed its ministerial purview and began to 2."Developing countries have no say in the Bank stream people with development backgrounds into since they do not hold enough shares." it. The other Nordic countries soon followed suit. This is a misconception. Since the fall of the Berlin In the UK, the Development Minister has now taken Wall, the number of borrowing countries with rep- over the file. If you want to increase the benefits of resentatives on the Board has increased: the G7 is the World Bank for the poor, you need to campaign now a voting minority. There is hardly ever a vote at home so that the World Bank will be understood within the Board because the Bank seeks to oper- as a development organisation. Only in this way ate by consensus. While the Board might need to will your countries align with the poverty agenda that prepare better on occasion, borrowing nations do the World Bank wants to situate at the centre of its have representatives and they do have voting power. concerns and activities. 3."The United States dominates the World Bank." While the US does have a veto, it applies only to two topics: capital increase of the IND, which only happens every decade, and new membership. The

25 The New World such as acid rain in Asia and water deficits in the Middle East, global climate changes. And social Economy and stresses will multiply, particularly if the world fails to Global Governance scale up the fight against poverty in a major way. The second force is the radically different world economy which is taking shape. At the heart of it, low-cost telecommunications and computer Jean-François RISCHARD technologies are reshaping production and logistics across the globe, making services tradable over long Vice President for Europe distances, and unleashing the full power of global World Bank finance. The ascent of electronic commerce and electronic money is not far behind, and even the emember how quickly it happened after education sector will most likely end up profoundly the fall of the Thai baht just three years altered. This technological revolution--which goes Rago: what looked like a manageable deep because it is about time, distance and knowl- problem flared up into a continents-spanning emerg- edge--is still amazingly young: a one-hour telephone ing markets crisis call between Paris and threatening broader New York could cost deflationary damage. as little as 3 cents per Even seasoned ob- hour by 2010. servers were stunned by the speed and mul- This new world tiple channels of the economy will bring contagion---capital unprecedented op- flight, declining com- portunities to all: new modity prices, portfo- products, new mar- lio re-adjustments kets, and highly em- away from emerging powering new ways markets, highly lever- of doing things. For aged hedge funds re- the developing world, versing gears. But it offers the best equally astonishing was the proliferation of editori- chance at the kind of catch-up growth that is needed als, debates, calls for action, and proposals for new to correct the untenable imbalance of today's planet architectures which accompanied the crisis. This kind where 20% of the people consume 80% of all the of planet-wide soul-searching is likely to be with us goods and services. But like the demographic force, for decades as we face the real crisis behind the the new world economy will also bring its load of crisis: the crisis of complexity, and its twin, the glo- stresses: growing disparities between countries and bal governance crisis. within countries between skilled and unskilled work- ers, bouts of financial market turbulence, and the The increased complexity in the making has sheer struggle of countries, sectors and firms scram- to do with two huge forces that will guarantee de- bling to adapt to the new rules of the game: agility, cades of massive worldwide change, of which we learning, networking. have only seen the beginnings. The first force has to do with demography--the world's population will As these two big forces build up seemingly increase from today's 6 billion people to some exponential complexity, they will put intense pres- 8-9 billion during the first half of the new century. sure on all types of human institutions, which tend to Environmental stresses will develop throughout the evolve only incrementally and linearly. Among these, planet on all fronts and at all levels--localized prob- public institutions in charge of governance may be lems of pollution and depletion, regional problems the most challenged, for various reasons.

26 need to cover an even broader and more complex First, civil servants find it more and more array of challenges than after the war, and are un- difficult to keep up--bank supervisors with sophis- likely to get by with a single time-bound problem- ticated financial derivatives and trading techniques, solving exercise. telecom regulators with an industry that changes every six months, social workers with spreading urban vio- Second, as many are beginning to conclude, lence. Increasingly, they will need the help of private time may have come for a new tool: multiple "global sector and civil society players for problem-solving. public policy networks" centered on the 30-40 glo- bal issues that really matter--from global warming Second, traditional public institutions are by and fisheries depletion to the likes of financial mar- and large locked into hierarchical structures that ket supervision and taxation in the information age. aren't made for the new world we have entered. These would be permanent international networks People in such structures are used mostly as infor- of government ministries qualified to deal with the mation transmitters, piping information to a small issue in question, working together with private sector number at the top who try to control everything and and civil society players able to bring superior knowl- are in fact overwhelmed by complexity. By contrast, edge to the problem-solving process--with a spe- businesses like ABB and many other large firms are cial role for the latter in instilling the crucial human moving to flatter, more agile information-age institu- dimension. tions that get the best out of the new low-cost com- munications and computer technologies and turn Third, international institutions could be re- people into empowered assets. While a few gov- thought in the light of this. Many suffer from criti- ernments are experimenting with such approaches, cism and from some of the limitations of public insti- most are not. So expect a lot of stress in public in- tutions highlighted above. But think of them as stitutions as they cling too long to their traditional knowledge and relationship springboards to build industrial-age structures. on as part of the search for better global gover- nance systems. For example, they could each fur- Third, nation states are facing increasing limi- ther strengthen their distinguishing roles (trade for tations as territorial constructs. Long used to exert the WTO, labor issues for the ILO, poverty reduc- command over the political, economic and environ- tion and sustainable development for the World mental systems within their territories, they now see Bank, and so forth) while at the same time develop- the two big forces yanking the two latter systems ing a second role as servicers and facilitators of the outside their borders, leading to a sense of malaise various global public policy networks relating to their and lost sovereignty. specialty. While there are no full-fledged examples of this yet, the World Bank under Jim Wolfensohn Thus, the soul-searching around the emerg- has been experimenting in that direction with other ing markets crisis is very likely just one aspect of a partners on tri-sector alliances between public, pri- broader governance crisis in an age of increasing vate and civil society players. The early results are complexity. And the new global governance solu- encouraging--even if some participants feel odd at tions cannot spring merely from reactions to finan- first. cial crises, serious as they be. What is needed is a more profound re-thinking of planetary governance One thing is sure--the global complexity and in the light of the two big forces which are at the governance crises will have to be solved through heart of this increasing complexity. Seen that way, new ways of working together globally, and bold three tracks come to mind. departures from old, trusted concepts.

First, the current G7/8 governance setup may have to evolve towards new fora that are more in- A slightly different version of this essay appeared in clusive, more pro-active, and more brainstorming- the International Herald Tribune as an op-ed under oriented. This is the message behind recent calls for the title "A Crisis of Complexity and Global a "return to Bretton Woods". But this time, we may Governance" on October 2, 1998.)

27 Mr. Eldar Gahramanov Ms.Ulrike Lunacek List of Member of Parliament Member of Parliament Parliament of Azerbaijan Parliament of Austria Participants Azerbaijan Austria Mr. David Gamkrelidze Mr. Norbert Mao Member of Parliament Member of Parliament Members of Parliament Parliament of Georgia Parliament of Uganda Georgia Uganda Mr. Imran Ahmad Member of Parliament Mr. Jacques Godfrain Dr. Inonhe Mbikusita Parliament of Bangladesh Member of Parliament Lewanika Bangladesh Assemblée Nationale, France Member of Parliament Parliament of Zambia Mr. Francisco Arnau Navaro Mr. Jan Hoekema Zambia Member of Parliament Member of Parliament Parliament of Spain, Spain Dutch Parliament Mr. Josef Muhlbachler The Netherlands Member of Parliament Mr. Ali Ashraf Parliament of Austria Member of Parliament Ms. Tytti Austria Parliament of Bangladesh Isohookana-Asunmaa Bangladesh Member of Parliament Mr. Adamou Ndam Njoya Parliament of Finland, Member of Parliament Mr. Philippe Auberger Finland Parliament of Cameroon Member of Parliament Cameroon Assemblée Nationale, France Ms. Inge Jager Member of Parliament Mr. Desmond J.O'Malley T.D. Mr. Kwadwo Baah-Wiredu Parliament of Austria, Austria Member of Parliament Member of Parliament Parliament of Ireland Parliament of Ghana, Ghana Ms. Hilde F. Johnson Ireland Member of Parliament Ms. Emma Baroness Parliament of Norway, Norway Mr. Juan Jose Ortiz Perez Nicholson of Winterbourne Member of Parliament Member of Parliament Mr. Mostfa Kamel El Said Parliament of Spain, Spain European Parliament Member of Parliament United Kingdom Parliament of Egypt Mr. Atanas Paparizov Egypt Member of Parliament Mr. Ali Belhaj Parliament of Bulgaria Member of Parliament Mr. Kimmo Kiljunen Bulgaria Parliament of Morroco Member of Parliament Morocco Parliament of Finland Mr. Ricard Perez Casado Finland Member of Parliament Dr. Ralf Brauksiepe Parliament of Spain Member of Parliament Ms. Tess Kingham Spain Parliament of Germany Member of Parliament Germany House of Commons Mr. Manuel Pinto United Kingdom Member of Parliament Mr. Carles Campuwano Parliament of Uganda i Canades Mr. Bert Koenders Uganda Member of Parliament Member of Parliament Parliament of Spain, Spain Dutch Parliament Ms. Excma. Sra. Dña Rosa The Netherlands Posada Chapado Prof. Dr. Henk de Haan Member of Parliament Member of Parliament Ms. Paula Kokkonen Parliament of Spain Dutch Parliament Member of Parliament Spain The Netherlands Parliament of Finland, Finland Mr. Maximilian Reiman Ms Sharon Dijksma Mr. Jeannot Krecké Member of Parliament Member of Parliament Member of Parliament Parliament of Switzerland Dutch Parliament Parliament of Luxembourg Switzerland The Netherlands Luxembourg Ms. Patricia Remak Mr. Claude Evin Mr. Zlatko Lagumdzija Member of Parliament Member of Parliament Member of Parliament Dutch Parliament Assemblée Nationale, France Parliament of Bosnia, Bosnia The Netherlands Mr. Roland Wiederkehr Speakers and Chairpersons Observers Member of Parliament Parliament of Switzerland Switzerland Mr. Jean-Christophe Bas Ms. Nayé Bathily-Sylla Pan European Dialogue Assistant Ms. Marianne Samuelsson Manager, World Bank World Bank Member of Parliament Parliament of Sweden Mr. Christian Delvoie Mr. William Benson Sweden Country Director Special Assistant World Bank House of Commons Mr. Famara Sarr United Kingdom Member of Parliament Mr. Aimé Gogue Assemblée Nationale Former Minister, Professor Mr. Pum Cook Sénégal University of Togo, Togo Assistant Dutch Parliament Prof. Ferdinando Targetti Ms. Eveline Herfkens The Netherlands Member of Parliament Minister of Development Parliament of Italy, Italy Cooperation Ministry of Mr. Rudolf Dolzer Development Cooperation, Professor Mr. Mamadou Lamine The Netherlands University of Bonn Thiam Germany Member of Parliament Mr. Gilles Hervio Assemblée Nationale Head of Unit, Directorate Mr. John Donaldson Sénégal General for Development External Affairs Counselor European Commission World Bank Mr. Gilbert Trattner Member of Parliament Mr. Mats Karlsson Ms. Susana Esteban Berrocal Parliament of Austria Vice President, The World Bank Counselor for Southern Europe Austria World Bank Mr. Michael Koehler Ms. Adelheid Troescher Advisor, European Commission Ms. Anne-Marie Fahi Member of Parliament Assistant Parliament of Germany Mr. Ed Kronenburg Irish Parliament Germany Office of the Special Ireland Coordinator of the Stability Mr. Maxime Verhagen Pact for South East Europe Ms. Anita Kuyt Member of Parliament Deputy Special Coordinator Assistant Dutch Parliament Dutch Parliament The Netherlands Mr. Emmanuel Mbi The Netherlands Country Director Mr. Bowen Wells The World Bank Mr. Matthew F. McHugh Member of Parliament Advisor House of Commons Mr. John Page World Bank United Kingdom Director PRSP, World Bank Ms. Candice Raymond Mr. Tony Worthington Mr. Christian Poortman Special Assistant Member of Parliament Regional Coordinator for HCCI, France House of Commons South East Europe United Kingdom World Bank Ms. Cathy Russell Program Assistant Mr. Hans Zbinden Mr. Jean-François Rischard World Bank Member of Parliament Vice-President for Europe Parliament of Switzerland World Bank Ms. Wilma Kooijman Switzerland Assistant Mr. Andrew Rogerson Dutch Parliament Special Representative to The Netherlands the EU World Bank Mr. Frederick Stapenhurst Senior Public Management Mr.Ted Van Hees Specialist, World Bank Coordinator, Eurodad Ms. Claudia von Monbart Mr. James D. Wolfensohn Counselor for President German Speaking Countries World Bank World Bank The Pan-European Dialogue of the World Bank

The dialogue engaged in The Hague with parliamentarians is an important element of the pan-European dialogue launched by the European Vice-Presidency of the World Bank, which aims to bring together European leaders around themes of key importance to the World Bank.

Through meetings and consultations with various constituencies in Europe - academics and thinkers, policy makers, business leaders, NGOs, civil society and trade union representatives - the World Bank wishes to:

¨ exchange views on development challenges and global issues for the decade to come;

¨ engage in an in-depth dialogue about the role of European countries and the European Union in international development, and contribute to European and international perspectives on development;

¨ explore possibilities for future consultation and information exchange on development cooperation and the work of the World Bank.

Jean François Rischard, Vice President for Europe

Jean-Christophe Bas, Pan European Dialogue Manager, Tel: +33 1 40693035, fax: +33 1 47237436, email: [email protected]

Hendrikus Ter Maat, Counselor for the Netherlands, Tel: + 32 2 552 00 52, fax: + 32 2 552 00 25, email: [email protected]

Nayé A. Bathily-Sylla, Assistant, Tel: +33 1 40693017, fax: +33 1 47237436, email: [email protected]

Our thanks to Cathy Russell for writing the summary report and Jean-Michel Gillet for designing the report. A special thank you to the whole EURVP team for its contribution to the organization of the event. World Bank World Bank Headquarters Vice Presidency 1818 H Street, N.W. for Europe, Washington, D.C. 66 avenue d'Iena, 75116 Paris, 20433, USA France Tel: (1-202) 477-1234 Tel: (33-1) 40 69 30 00 Fax: (1-202) 477-6391 Fax: (33-1) 40 69 30 64

www.worldbank.org