Wolfensohn promotes WB's new development policy

Wolfensohn promotes WB's new development policy

BANDUNG (JP): Some 100 demonstrators who delayed World Bank
president James D. Wolfensohn for about 20 minutes inside the
Akatiga office in Bandung on Friday afternoon believe the
multilateral bank is a vestige of the corruption-infested,
authoritarian rule of former president Soeharto.

But Wolfensohn, despite his busy itinerary, came to the West
Java capital precisely to listen to the aspirations of poor
people, to critics, and to convey a message that good governance
is now central to the World Bank's new development policy.

The World Bank chief, accompanied by Minister of Settlement
and Regional Development Erna Witoelar, held a brainstorming
discussion for about two hours with representatives of non-
governmental organizations (NGOs) and student activists
immediately after arrival on the Parahyangan train.

"I can get reports and read them at my hotel room in Jakarta,
but I prefer talking to people, listen to their voices," said
Wolfensohn in opening the discussion at the Akatiga NGO office.

He said he had found during his visits to developing countries
over the past five years that poor people lacked a voice and had
no opportunity to speak up and be heard.

That is why, he added, he has promoted within the World Bank a
new development policy called comprehensive development framework
(CDF) that covers social, structural, human, institutional,
environmental, economic and financial aspects of development.

From now on, according to Wolfensohn, World Bank lending
programs should be based not only on consultations with the host
government, as in the past, but also on partnership with civil
society elements, the private sector and other stakeholders and
external development partners.

"We are no longer oriented to project lending but to capacity
and institution building. We consider a loan only part of the
means in the overall development approach," he said in reply to
questions from skeptics at the meeting.

He added that poor people were adversely affected by
corruption.

According to Wolfensohn, development in a country is
fundamentally flawed and will not last even with the most sound
macroeconomic management and good fiscal and monetary policy if
that country does not have good governance.

Most activists who got the opportunity to speak during the
discussion said they still doubted the World Bank's seriousness
in its new development philosophy, pointing out that the agency
is part of the global capitalist system.

"How can you promote accountability, when you yourself are not
accountable to anybody? How can you listen to our views when you
get impatient with a participatory development process?" a
student activist retorted.

Wolfensohn admitted that in the past it was extremely
difficult for the World Bank to get its message across to the
Indonesian government.

"Sounding an alarm when the economy was growing 7 percent a
year was a futile move," he said, referring to the situation
under the Soeharto administration.

He did not entirely dismiss accusations that the World Bank
had been a source of corruption and loyal supporter of the
Soeharto regime.

The World Bank, whose Jakarta office was set up in 1968 and is
now one of the largest of its country offices overseas with 200
staff members, was completely caught off guard by Indonesia's
economic crisis that began in late 1997 with the crash of the
rupiah.

Its annual report on Indonesia issued in May 1997, titled
Sustaining high growth with equity, gave an optimistic assessment
of the country's economic prospects.

Erna, who was herself an NGO activist before her appointment
to the Cabinet last October, admitted she was in the past one of
the strongest critics of the World Bank.

"I myself took part in the demonstrations in Washington in
1994, which called for the dissolution of the World Bank," Erna
recalled.

When the World Bank celebrated its 50th anniversary in 1994, a
lively network of critics organized itself around the world with
the provocative slogan of "Fifty years is enough".

The World Bank listened politely to the worldwide criticism
and promised to consider people's complaints, but appeared to go
on with business in the usual manner.

Wolfensohn, who was appointed president of the bank in 1995
and was reappointed last year for a second term until 2005,
apparently needs to work harder to promote the new development
policy among the World Bank staff members themselves.

Erna added, however, that the World Bank had begun changing
its approach to development, emphasizing partnership with all
elements of society.

"I notice the World Bank is now listening to people's voices,
to NGOs and no longer dictates its policy," Erna said.

Wolfensohn conceded that the World Bank found it much easier
to work with the new government (under President Abdurrahman
Wahid) since what the government is now striving to achieve is
what the World Bank has aspired to do.

He acknowledged that the new approach to development the World
Bank is promoting is much slower as the process requires a lot of
listening to different views.

"But working out a program through such a comprehensive
consultative process would be much more effective for ensuring
broad participation," he added.

But the "Go to hell with your aid" and "Damn your project"
banners that greeted Wolfensohn when he and Erna exited the
Akatiga office and escaped inside a Kijang van to attend another
program speak volumes about the amount of convincing he needs to
do to get his message across to poor people in developing
countries.