Transcript of the Civil Society Organizations Townhall Meeting

Washington DC
October 7, 2010


CHAIRPERSON:  May I start?

Okay, well, this is the Civil Society Forum, and so I'm just starting even without permission.

My name is Jo Marie Griesgraber, and you'll know why I was invited to chair this because I represent the other half of humanity.  But please let me welcome all of you to the Civil Society Townhall.  I call it "The Forum".  And we're going to do something a little bit different than we've done in other years.

In other years we've sat and we've listened very politely to the President of the World Bank and the Managing Director of the IMF do a presentation, sort of a State of the Union address, to Civil Society.  Well, last year in Istanbul we sort of rebelled a little bit.  And now there are two members of Civil Society who in consultation with other fellows, World Bank-IMF Fellows, that's the word for people whom the IMF and World Bank have identified as local leaders, and they paid their way and have done some orientation.  These two gentlemen have been in conversations with their colleagues, their peers, and have some initial ideas and issues to raise.  And so the Civil Society Townhall is being launched by Civil Society, which I think is a great idea.

Did I say my name Jo Marie Griesgraber and I'm with New Rules for Global Finance, and I have the privilege of working on coordinating Civil Society input to the IMF governance debate, which is still ongoing, I understand.  Right now we've moved from the polite discourse to the fight among elephants, and we won't ask them what the status of the fourth pillar is, will we?

Okay.  Our two questioners from Civil Society, the first one is Dickson Khainga. He doesn't want to be called "doctor" but he is Dr. Khainga, a policy analyst and head of macroeconomics at the Kenya Institute of Public Policy Research Analysis.  His doctorate is in political economy from the University of Tsukuba in Japan.  He has experience in, good grief, everything:  public expenditure review management, balance of payments, macroeconomic modeling, medium-term budgeting, national development planning.  And he focuses on these issues in Kenya.

Well, that's good, because you're from Kenya, and you live in Kenya.  And I'm going to just introduce the second CSO Representative at the same time.  His first name is not Bishop, as I thought it was.  That's his title.  He's an Anglican Bishop in the Church of Uganda, the Anglican Church of Uganda.

His first name is really David, David Zac Niringiye.  And he served as Vice Chair of a national commission that led an assessment of Uganda's political, economic, and corporate governance and social economic development.  Currently, he is the Chair of the African Peer Review Mechanism, remember NEPAD it's related to that somehow, of the Uganda National Governing Council which is charged with overseeing implementation of the National Program of Action on Governance Priority in Uganda.

And because he doesn't have enough to keep him busy, he works on conflict resolution and HIV/AIDS and World Bank governance issues.

We're going to start off with Mr. Kahinga.  Sir, you have the floor.  You get to pose the first question to Mr. Strauss-Kahn.

MR. KAHINGA:  Okay.  Thank you very much, and the issues that I'm going to raise have been gotten through consultation with the CSO colleagues. I've tried to summarize them, but I couldn't be able to summarize all of them, so I'll take quite a short time to raise those few issues, and then I'm hoping that later they will be able to raise others that I may not capture individually.

The first particular issue that I may want to say is that the civil society appreciates the efforts that the IMF and World Bank are undertaking to deepen and broaden engagement with the civil society organizations.  And yesterday, we did have a capacity-building event, and what we did learn from this is that some of the civil society organizations would like to know much more about these two leading financial institutions in terms of what exactly they do and even how they can be able to engage them.

And this clearly and mainly refers to the CSOs that are from low-income countries.

Now they would wish to have this scaled up, perhaps at a regional level and even at the country level.  If I come to the other issues.  One particular issue that comes up is the issue of how ownership of development programs can be enhanced at the country level.  And the civil society organizations that we have here are promoting different goals in the society, from democracy, governance, good governance, human rights, poverty reduction, policy research, and they feel that they can be able to be engaged much more than they are being engaged at the moment.

Most of the CSOs that are here from low-income countries are under the IMF-supported programs, like the PRGF, and they do feel that they would still play a much better role in terms of enhancing the local or country ownership.  There's that feeling that the dialogue is still one-way ideas being generated in Washington, and given down there.

What we came to learn is that for some of the high-income developing countries they still feel some stigma getting to IMF.  And for those that are the very low-income poor countries, they still have those images of the structural adjustment programs and the serious conditionalities.

And one particular aspect that comes out is that if the IMF could be able to apply the same standards like the standards and codes on transparency in fiscal and monetary affairs in terms of dealing with these countries, and involvement of CSOs in developing programs for these countries.

Another important issue that came up is the issue of voice and representation.  There's need for more voice to be given to the poor countries, and the current economic landscape reflects some changes that require that the vibrant emerging economies should be able to have a much bigger say.  In this particular area, we would appreciate having some updates on what is happening on this particular point.

The other important issue is on the global financial crisis, and the recent data indicate that there is a weak recovery, but unemployment is still high.  Poverty is still also high in many of these low-income countries.

And there are indications that there are moves to undertake some austerity measures, and the CSOs would want to understand the position of IMF on this particular aspect in terms of policy leadership on the macroeconomic policies to support employment and poverty reduction.

And the final issue that I would raise is a follow up on a very important initiative that the IMF started, the so-called Fourth Pillar, of engaging civil society organizations in terms of reforming the IMF.  And some of the issues that  have led to the review of the quota formula, use of double majority voting system.

We would be happy to get an update on the exact status on these issues.  Thank you.

CHAIRPERSON:  I forgot to introduce Mr. Dominique Strauss-Kahn.  He's the Managing Director of the IMF, and we're pleased that he's here.  And he has some tough questions.  This is not like your defense of your dissertation or anything, sir.  It's worse.

MR. STRAUSS-KAHN:  Worse, but much more interesting.

CHAIRPERSON:  And important.

MR. STRAUSS-KAHN:  Well, thank you, Jo Marie.  Hello to all of you.  I think it's an improvement that we try to organize this year the meeting in this way and probably will be more interesting, and more productive.  I will be very much interested, and I'm sure Bob will also be by your feedback after this meeting and following enhancement that we can try to put in place.

Let me try directly to answer as well as I can the questions, which have been asked, starting maybe with the last one, which has to do with the global crisis, austerity measures, employment, poverty reduction.  Where do we stand?

And I understand the question, because many are asking the same question.  Finally, what does the IMF say in terms of exiting the stimulus, which has been put in place for the crisis?  What kind of a measure do you propose?  Where's your line?

In fact, this line I think is absolutely consistent, but what you have to understand is that the different countries in the aftermath of the crisis are clearly in different situations.  Being in different situations, the policy that should be applied, in our view, in different countries are totally different.

So it looks a bit like if we're proposing different kinds of policy, just not knowing where we want to go.  That's not the point.  The point is that at the beginning of the crisis, at the outset of the crisis, it was clear that everywhere where it was possible there was a need to support private demand, which was too weak, with public spending.

Of course, the amount available, the possibility to intervene depended upon the country, depended upon the fiscal room that was available, but the direction was clear for everybody; the same thing for monetary policy.

In the aftermath of the crisis, it's a bit different, because different countries entered the crisis with different level of debt, for instance.  The debt has increased everywhere during the crisis, but at the end of the crisis we may have countries having real problems, including in advanced economies.  Everybody has heard about the problem in Greece, for instance, and for those countries they have no choice.  They're really at the edge of the cliff, and there is no way but trying to go back to something which will be more sustainable.

It's very hard for the people.  The government has to take very tough measures.  It's the accumulation of mistakes done by several governments over decades, but now it's paid by the man in the street.  And we clearly understand that it's very difficult.

On the other hand, there is no other solution.  I mean the Greek case there were some days of total collapse, a couple of days.  There was no other way than try to go back on track.  So we tried to help.  We're following in this case the European Union, by providing resources and trying to give advice on going back on what can be sustainable.

Clearly, it's very difficult but you have other countries where the situation, while not being really easy, is not as difficult.  And so the policy advice is not the same one.  And you have even some countries were you still have a lot of fiscal room, allowing for ongoing support to the economy, and then the policy of advice is even more different.

So now, we're facing diverse situation, so we need to put in place diverse policies.  And this idea that sometime has been a criticism addressed to the Fund, which was to promote a kind of a one-size-fits-all policy, obviously doesn't apply this time.

So there is no austerity policy.  In some countries, you have an absolute need to go back to stability.  In some other countries, we are encouraging supporting demand, because the private demand is still very weak.  And if you look at the map of the world, you'll see that the recovery is there, but the recovery is really uneven.  In Asian countries, it's doing rather well.  In South America, it's doing rather well.  Even in many African countries, growth is back, but with a lot of inequalities and a low level of outputs, so the problem of helping the government is still there.        This uneven recovery has to be addressed in different parts of the world by different kinds of policy.  That's to try to have higher growth; the growth is not the end of the story, because the man in the street is not that much interested in growth.  He's interested in jobs.  And the question is how to transform this growth into jobs.

It may happen either that growth is not enough, not big enough to have unemployment decreasing or that even with the high level of growth, you don't have unemployment decreasing, because it's associated with a very high level of productivity.

So the question we discussed with our friends from the ILO -- International Labor Organization -- a few weeks ago in Oslo, which was the very first time that we met together, was to say okay, growth is the first step.  There's no way to get out of it without growth, but then growth has to be translated in something which is concrete for the people of these countries, and that's not only job.  It could be purchasing power.  It's a different way to say it, but job is certainly the more, the simplest way to say that.

Together, it goes with poverty reduction, because we all know that international aid is absolutely necessary, but there is no way to get out of poverty without having growth in the economy itself.

A good example of this is given by what we are preparing, together with the World Bank, for the G20.  You know that the G20 is going to meet in Korea twice in the coming weeks, at the level of the Finance Ministers at the end of October, at the level of the Head of States in mid-November.  One of the important sessions will be the session about what we called the MAP, the Middle Assessment Program, which is providing a framework where we try to take the information coming from the different countries to see what they could do to work better together and how cooperation could provide better results, rather than trying to find a domestic solution which may be harmful for your neighbor.

What we show, and that will be released in a few days, is that this cooperative program or attitude can help to have as much as 2.5 percent of growth, extra growth in the coming five years, which will present 30 million jobs and more than 30 million people taken out of poverty.

So it means that there is a win-win solution, where everybody can be better off if cooperation is organized.  That's also part of our job, which is directed to the policy in place in the big countries.  Some are emerging countries.  Some are advanced economies.  Some even are low-income big countries, but which have a consequence, which have consequences and spillover on the rest of the global economy.

So the picture is a bit more complex than just stimulus or austerity.  We are, I hope, in the end of a very complex crisis.  I'm not sure it's to end.  It's not over now. It won't be over until unemployment decreases and clearly in the different part of the world.  It's not the case today.  It won't be over before we're sure that we can obtain results in terms of poverty.  It's not the case today.

So it's certainly too early to claim victory and believe that the crisis is behind us.  But if we want really to exit this crisis, we need to organize this kind of cooperation and to differentiate the message depending to whom it's concerned.

Your second big point--I'll try to go a bit faster--I think that--

CHAIRPERSON:  Yes.

MR. STRAUSS-KAHN: You begin to be upset, so…

CHAIRPERSON:  The Chair is upset.

MR. STRAUSS-KAHN:   I'm sorry, I'll try to say as much as I can.  I'm going to be shorter.  Your second point went on voice and representation, and that's a very, very important question, and you're absolutely right in coming to this point, because to be effective, an institution like the IMF has to be legitimate.  And it's secret no nobody that for a very long time, and even now, most countries and most citizens of this world believe that the IMF is really an ugly devil and that the best thing you have to do is to try to avoid having any kind of relation with this institution.

That's a bit unfair, but it's understandable, because, you know, we come when the country has problems, when the situation is difficult.  I was just talking about Greece.  So, of course, the kind of medicine that we can propose to somebody who is ill, and being sick, you don't always want the doctor to tell you what you should do.  Sometimes it's painful.

But to be able to do it, we need to be legitimate.  And the legitimacy of the institution has to be enhanced, and that's the question of voice and representation.  And we're in the process of shifting a large amount of voting power from advanced economy to a dynamic, emerging economy so that the structure of the membership and the voting power in the membership will better represent the reality of the world, which is obviously a changing reality.

So this is going on.  The same for the composition of the Board of the IMF.  There's a big discussion for the Europeans to make some room, to have more emerging countries around the table.  These discussions are still underway.  I hope they will be completed rather soon, but it's not done yet.  However, the direction of the move is clearly a direction where the institution will be less dominated by advanced economies, and more by emerging countries and developing countries.

And the last point, the one you started with, is certainly the one which we have to make the more progress is how can we take into account, take on board, when we define with the government what will be the right way or the right policy to implement, what will be the right way to get out of the problems.  When we try to do that with government, how can we take on board a proposal that could be made by the civil society?

We already made some progress, I believe, by meeting much more than in the past the labor unions, for instance. And the relation we have now with labor unions is very different from what we had in the past.  That's the reason why we had this conference with the ILO, and I have many other examples of that.

But labor unions are not all civil society, not alone.  So we need to go further, and especially on the points you were quoting, which is the governance question, human rights, fighting against corruption--all these kinds of things, which are a part of our program.  And many programs in Kenya, as you are from Kenya.

MR. KAHINGA:  Yes.

MR. STRAUSS-KAHN:  In Kenya, you know that part of the program with Kenya has been completed.  There were requirements and conditionality in terms of our governance.  But, of course, we can make a lot of progress on this, and certainly the help that can be provided by a country-based organization knowing exactly what's going on and the advice they can provide us something that we have more to take into account.

So we need to define a process to do this.  We're a process-based organization.  It cannot be done just like this, just because you meet a friend and he gives you advice. It has to be organized in a process, but we certainly can do it.  And that may be a way to avoid that the dialogue remains one-way,  and also a way for the stigma to, I won't say to disappear, but at least to decrease.  And that's very important  because the people working in the IMF are human beings that like you don't like to be seen as bad guys.

It's important for another reason:  It's important because for a program to succeed there must be some ownership by the country.  And it's absolutely obvious that when the program is seen by the people in the country as something which is no good, then the probability of success is really low.

When discussing with CSOs, unions, students, business organizations, they say, well, we don't like it.  It's difficult, but we understand why you say that, and even if we argue that you could do it another way, we engage and we understand the need to do something, then the probability of success jumps a lot.  And that's what we need to do if we want to have success with program at the end of the day, to be able to provide growth, purchasing power, jobs, and economic stability.

You all know that economic stability is certainly not enough, but is a condition for a peaceful democracy.  And the way to avoid any kind of conflict or to at least to make less probable and to lower the probability of violent conflict is to have a strong enough economy.  And that's the work we try to do.

So you can be very helpful.  And we need to have not only an annual moment where we discussed like this, but as we already do more working sessions during the year so that what I have just said, which is involvement, better involvement in what we do, can become something real and not only proposals.  Thank you.

CHAIRPERSON:  Thank you, Mr. Strauss-Kahn.  I had offered Mr. Kahinga an opportunity to respond, but, in the interest of time, he has declined; so, therefore, we move on to Bishop Niringiye, who is going to raise questions and comments with regard to the World Bank, and then Mr. Zoellick, whom I will introduce now. Mr. Robert Zoellick is the President of the World Bank.  Sorry, we're being a little condensed right now.  Okay, Bishop.  Go for it.

BISHOP NIRINGIYE:  Thank you very much.  I add my own word of appreciation to this process.  Thank you very much.  I guess it would be good to also see this (dialogue) reflected in the regions.

The four areas, really:  one the area of governance.  No question that good governance is foundational for sustainable peace as well as social economic development.

The two key components to this, Mr. President, as you know, is a visionary and accountable leadership, as well as institutions, on the one part, and then on the other a civil society that is capable of demanding good governance and accountability.

I guess the critical question for us is to what extent the Bank is committed and is building capacity for local civil society organizations to build the demand side, that civil societies are able to demand good governance from those who govern, which includes accountability.

The Bank may need to carefully consider some of its lending instruments, because they can inadvertently become conduits of bad governance.  For example, the Bank has persistently used the poverty reduction support credits to provide direct budget support to governments.  Even if the budget support instruments have some prior action triggers, in countries where there is deteriorating governance, this becomes a very weak instrument for aid delivery.

In fact, budget support funds are very difficult to monitor and can even be greatly abused by governments.  And I wonder whether it's time to evaluate the needs, the need to evaluate this process with a view to ensuring strengthening good governance.  And this may entail providing specific project support towards governance initiatives which are easier to monitor and evaluate.

The second is related to investing in climate change and the priority of energy and climate change.  Climate change is critical to development, poverty reduction.  This is all work that has been done in the Bank.

But the question is what is the level of investment by the World Bank Group globally in climate change mitigating measures and how does the Bank balance climate change mitigation with the energy supply needs for low-income nations.  And how do the rich and poorer nations share responsibility for global, sustainable development.

We wonder whether it isn't time for the Bank to consider investing in R&D (research and development) in poor countries to ensure that the energy sources to be exploited do not negatively impinge on the ecosystems.

And the third is the investing in education.  Again, we acclaim the fact that the Bank has continuously made this a priority in the low-income countries.

Now research has shown that some countries' education systems promote equal chances for students of all backgrounds.  Why in other countries education systems actually produce social disadvantage?

When the World Bank works with countries, it usually works at literacy and vocational training levels, secondary school, primary school levels, increasing enrollment and so on, but not examining as to whether the education system actually promote social equity.  Is there going to be a change in this approach?, realizing that some of the educational system actually increases the disadvantage of the rural (poor); increases disadvantage of even those who are living in the slums, and disadvantage of those whose families are not educated.

So the whole question of examining the education system and not just supporting systems as they are.

And lastly, similar to the question my colleague Dickson asked, the extent to which civil society is engaging, to the extent to which the Bank is taking on board issues from civil society.

To what extent is civil society shaping, informing the priorities of the group, especially in the light of the first question of governance, and the results and outcomes that you seek.

We are wondering, and this is a question that has come from our discussions, in the structures and the processes of the World Bank, do you require that Country Officers engage actively with civil society so that, as they develop the country assistance strategies, civil society voices are there.  And if so, do you also have mechanisms to assess the extent to which these Country Officers are taking on board those questions and concerns.

We recognize how significant World Bank initiatives are, how pivotal they are in assisting these countries, and so we also have come to the place where certainly the role of civil society in the shaping of the destiny of our countries is critical.  To what extent, then, is the Bank engaging and bringing on board, involving civil society in this process.  I thank you very much.

CHAIRPERSON:  Oh, Mr. Zoellick, I'm sorry for your sake.  This is a hard set of questions.  Maybe next year, you'll revert to the old style of town meetings.  These are tough questions.  Good luck.

MR. ZOELLICK:  Well, thank you very much, Jo Marie, and thank you very much, Bishop Niringiye.

Let me try to put your first question with your fourth one, and then I'll come back to the energy and the education.

And let me start out with what might be the most important point in the time we have.  We obviously respect the independence of civil society groups, but we also view you as key partners in the development process for the exact reason that you mentioned.  I think one of the lessons all of us have learned the hard way is that development requires country ownership, but it also requires good governance.

So we need to try to see what we can do to strengthen governance and institutions, and so we want to engage civil society groups in ways that help us learn things, help learn how to improve the governance, help us identify mistakes when we make it.  And let me explain more specifically how we try to operationalize this.

One of the things I'm most proud of at the Bank is that we just this year were able to get our 187 shareholders to agree to a freedom of information process.  It's built on the U.S. and India FOIA (Freedom of Information Acts) system.  This is the first time any multi-lateral institution has done this.  So what this involves is, (while) many institutions make papers available, we've switched from what many governments still have which is called the ‘positive’ list of documents they make available to a’ negative’ list.  You ask for it we make it available, unless it falls into an exception.  Because we need to be accountable, we have an independent panel of people from around the world who evaluates whether it falls into the (list of) exceptions.

Similarly, one thing I really hope you have a chance to check out, my colleague Caroline Anstey has been one of the driving forces with this, is that we have launched something called the Open Data, Open Knowledge, Open Solutions Initiative.  And the origin of this comes from meetings like this over the past couple years, where I have people come up and say, you know, the Bank has got some incredible data sources, but you don't release them all or you charge for them.  And I would go back to our research team, and they'd say, Yes, we charge because we actually add some value, and it helps our budget and so on and so forth.  Those of you who've seen large organizations know you have to go through a few rounds of this, but we have now opened up 4,000 different data indices for free.

In fact, we doubled that (the amount of data available) this week.  So, some of these are sources that have never been made available.  They go back in some cases decades long, and we're developing software applications to make it easier for people around the world to use them.  So you can check our poverty counts.  I mean so it's not just participation in the process.  You can go country by country, and we're also working with Google to do geo-mapping so you can look within countries so you can assess how we do forecasts.  You can assess how we do the poverty count.

We have going on right now an Open Forum, which is an Internet-based discussion about these development topics, and we're launching an ‘apps for development’ competition so that people will use our data related to the MDGs, the Millennium Development Goals, which come up with new applications on these things.

And for you that want to check it out, it's link is www.worldbank.org/open. And I really urge you to try it, because so far the response we've gotten from the blogosphere has been pretty encouraging.

Now on some of the more specific points that you raised, we do engage at the country level with country-based civil society organizations when we develop the poverty reduction strategy process.  Most of these (poverty reduction papers) are then going on the Web, so one of the things you want to talk about is how to open this process to assess how we are doing.

You mentioned the development policy loans, and this requires a balance, and I take your point, because one of the reasons we've been able to get out $88 billion to poor countries in this difficult time is the use of development policy loans, because investment loans or project by project take longer.

But 96 percent of our IDA for our poorest country development policy loans also supported institutional reform.  So they may have reforms for public expenditures or financial management tools.

But I agree with you:  they're not appropriate in all circumstances, and this is one issue that we actually also work on with the IMF.  If we feel that, frankly, the corruption issues or the governance issues aren't at a (good) state, we won't use them.

To try to buttress this is one of the challenges we have had because we're a governmental institution and we work through governments. It's actually one of the issues that I've been trying to see how we can be creative on is how can we support civil society organizations, but also do so in a way that recognizes their independence.

We've actually done some funding through something we call the Development Marketplace, and the Japanese have been very helpful with the Social Development Fund.  So just to give you a sense of this, in the East Asian Pacific Region, we've done some 52 grants for $115 million to help CSOs participate.

You mentioned the Climate Investment Funds.  For the first time, in the case of the Climate Investment Funds, but also in an agriculture food security process that we created as part of dealing with the crisis, we have worked with governments to actually engage CSOs to participate on the advisory and the steering group process.

In some cases, and this depends on the nature of the civil society group, they are key partners, for example, in emergency relief.  So we work hand-in-hand with civil society groups and NGOs in Haiti, in Pakistan, in Indonesia on a lot of the emergency relief process.

In the area of food security one of the things my colleague Ngozi Okonjo-Iweala and I, when we had the food and fuel price crisis before the financial crisis which hammered a lot of countries, we were able to get our Board to agree to some faster financing mechanisms and raise some additional funding for this.  As part of our outreach, we've had, I think, our eighth dialogue with a series of NGOs globally, some of them using video conferences, so we can try to get information and their sense on some of these issues.

Just this week, I met with a number of foundation heads, a lot of them were from the U.S, but there were some from Europe and some from India and one from Senegal, where we talked about the possibility of some foundation funding for CSOs.  All of us are well aware at a time of financial strife this has been hard on everybody in the NGO community more broadly and it's harder for us.  This is why to try to do the funding since we fund governments, but we launched the idea of maybe working with some of the foundations in some issue areas, food security or in some of the open data issues, to get some additional support.

So I'm sure there are other things that this group and others can come up with, but I wanted to outline some of these to give a point that when I talk about CSOs being a crucial part of governance, it's not just talk.  We're trying to open up our sources.  We're trying to engage them in our own processes to make this work more effectively.

Now you asked particularly on the energy and climate change policies.  In 2010, we set a record of a little over $3.6 billion of our total energy portfolio was dedicated to renewable energy or energy efficiency projects.  Of our total energy spending, about 60 percent includes either renewable energy efficiency or transition. Excuse me, transmission and distribution.

And again, to put this in other context, over the past five years, we've had a little over 400 renewable energy and efficiency projects in 100 countries, including 118 projects in 51 countries last year alone.

Now I mentioned this Climate Investment Fund.  This is on top of that.  The Climate Investment Fund, with some contributions we've gotten of about $6.5 billion, we've been able to leverage about 10 to one (dollars), so we've raised about $50 billion to $60 billion.  Sometimes other money from us, sometimes regional banks, some 30 percent from the private sector, some from governments themselves.  But the key point here is that this as part of a constant learning process, we now engage CSOs on the advisory and steering committee for those funds.

On educational systems--and you mentioned particularly social equity--much of the focus in the educational area has been on the Millennium Development Goal of getting both boys and girls into school.  But one of the observations that I brought back from the U.N. meeting just a week or two ago was we have to move beyond quantity to quality.  It's not only a question of getting people in school, but the quality of the schools.

This may depend a little bit on how you would define social equity.  We really want to create social opportunity for everybody in the society.  And what we're also trying to do--and this is, I think, going to be an important lesson for all of us with these MDGs--is we have to connect the dots of the intervention, because there's a tendency to do health separate from education, separate from poverty, and, frankly, in a world of constrained resources that's going to be hard to do.

If you look at some of these conditional cash transfer programs, the one that was started in Mexico, and now we support these in I think some 36 countries.  It's an anti-poverty program with the money goes to a family if the children go to school and if people get health checkups.  And it's probably done more for preventive health care for women in Mexico than anything in the country's history.

So this is where we need to be open to opportunities about innovation, and, in a sense, what that reflects is kind of the whole story here.  Part of the message we've been trying to get out is we don't know all the answers.  Nobody knows all the answers, but part of the whole nature of the development process is a broader engagement about what works in one country.  Maybe take it to another place, customize it to different circumstance, and clearly, this has to go beyond governments.

So, again, you know, I'm respectful, you know, when you talk about civil society groups, you've got different types.  You've got advocacy groups.  You've got groups that are in the field implementing different things.  You've got different sectors, and we want to be respectful of independence, but, at the same time, we would like to try to see how we can engage groups as part of a broader network.

CHAIRPERSON:  Thank you, Mr. Zoellick.

In the interest of getting as many civil society questions on the floor, I'm going to do two rounds of questions, and actually first one round, and then the second round.  So they'll be consecutive.  So this is your time to get the agenda on the floor.  If anybody doesn't have an e-mail of someone in the World Bank or IMF, you stay after, and we'll make sure you get a contact, because I'm sure all of you will want to have follow up questions or clarifications.

So in the World Bank, we're going to give you John Garrison, because I know his (email) heart, jgarrison, G-A-R-R-I-S-O-N, at WorldBank.org.

In the IMF, Jeremy.  This is my revenge.  Jmark@imf.org .  Because you can't get all the questions out and all the answers out in an hour and 15 minutes.  We have 24 minutes left.

So I want first the people at the table to have their questions ready.  Okay.  I'm going to go this way, and we're just ready to take your questions.  I don’t want any speeches, okay?  We have to be really tight in time, and while I've got the microphone, and I'm abusing it, there are two kinds of governance.  One is government corruption.  The other is whether the IMF and or World Bank is well governed.  Okay.  The two are not the same.  Be clear about what you're talking about, and what you're hearing.

Okay.  We're going to go down this row, and I saw the gentleman from India.  You had your hand up.  Say your name and your issue nice and clear and speedy.

MR. GUPTA:  I'm Shaibal Gupta.  I'm from India.  It was an extremely stimulating experience to hear the chief of IMF and World Bank.  I have one question that for development three things are very important:  market, corporate sector, and civil society.

Now in most of the underdeveloped countries, the market or the corporate sector is not functioning properly.

Secondly, civil society is still in the state of infancy, but I would like to add another, which the President of World Bank has mentioned, that we should also take into cognizance.  The state of the State, because without the State--State is really mediating the market, civil society, and the corporate sector, because the question…

CHAIRPERSON:  And your question is?

MR. GUPTA:  of governance is the most critical thing.  So I would like to know what is the initiative in this respect from both these organizations.

CHAIRPERSON:  Great.  Thanks.

MR. KUROWSKI:  I am Per Kurowski from New Rules for Global Finance.  Thank you, Jo Marie.

At this moment, this particular moment, banks in the world when they give a loan to a small business, and entrepreneur, have to put up five times more capital than when they lend to someone rated triple A.  When is the World Bank and the IMF going to speak out loudly against this odious discrimination that is affecting development, and that has no particular purpose at all, since all the financial and bank crisis never occurred where risks are perceived as high?

CHAIRPERSON:  Thank you.  Yes, sir.

MR. MAGALASI:  My name is Collins Magalasi, and I'm the Executive Director for the African Forum and Network on Debt and Development (AfroDAD), based in Zimbabwe.

My question is to the Managing Director for IMF.  Thank you for stating that IMF is a process-like institution, and I would want to know in as far as voice and representation is concerned, what process is in place to make sure that this voice and representativity has come into place; in other words, by when would you project that there will be substantial change, as you have mentioned, that IMF will be dominated by the majority of countries than is currently happening.

Part two of it is about growth.  Now this one is to the World Bank. Is there any process, any plan to ensure growth and development of SMEs and the informal sector.  That happens to be the majority of the sources of finance in Africa, and I think in most of the developing countries.  Thank you.

CHAIRPERSON:  Okay.  Thanks.  Quicker, the faster you are, the more of your colleagues can speak.  Yes, sir.

MR. SSEWAKIRYANGA:  My name is Richard Ssewakiryanga, from the Uganda NGO Forum.

Quick question.  I'm repeating your question that Bishop Zac actually asked, and I didn't hear the answer, which is to what extent does the World Bank and the IMF encourage their Country Offices to engage with local civil society.  The times they have engaged with…

CHAIRPERSON:  Thank you.

MR. SEWAKIRYANGA:  me are always either during a dinner, or when they are travelling to the airport.

CHAIRPERSON:  Thank you so much.  Okay.  I see this lady over here.

MS. GUEVARA (Milwida):  I'm from the Philippines.  I'd like to ask Mr. Kahn in the case of a country that experiences low growth and a high budgetary deficit, what would be your priority?  Is it going to be pump priming or is it going to be taming the deficit?

CHAIRPERSON:  Okay.  Good, short questions.  The woman with the red hair, and then we're just going to go real quick.  Okay. 

MS.GOLUBEVA (Maria):  To follow up on Bishop David's question on education, it's a question to Mr. Zoellick.  To what extent is the World Bank planning to shift its paradigm of working with governments on education to look at education as a holistic system, which includes those of higher and lifelong learning, and not just through the MDG prism.

CHAIRPERSON:  Great.  Okay.  Next.  Right down there.

MR. STEFANOV:  Thanks.  Ruslan Stefanov from Center for the Study of Democracy, Bulgaria.  My question is to Mr. Zoellick on democratizing knowledge.  Is the Bank having a process in place to source the social entrepreneurs and social innovations all around the world?  Thank you.

CHAIRPERSON:  Next.

MR. NDIAYE:  Yes, my name is Demba Ndiaye, from Senegal, Community Engineering Program.  My question is besides all the good impacts that you can witness about the civil society organization doing very well on the ground, is it lack of political will or distrust of those same civil society organizations from the World Bank and IMF not to still get them really involved in the decision-making process?  Thank you.

CHAIRPERSON:  Next.

MR. BEUNS:  My name is Vanel Beuns, and could you share with us the lesson learned by the World Bank and IMF over the past 10 years in Haiti?  And the second question was my expertise in finance and Haitian affairs, how can I be of assistance to the World Bank and IMF in Haiti?

CHAIRPERSON:  Next.  The gentleman with the hat.

MR. IBEKWE, My name is Josef Ibekwe from the Foundation for Literacy and Education Development, Abidjan, Nigeria.  I just want to ask something in connection with what my friend asked concerning education.  I want to find out what the World Bank is going to promote skills-based functional education for sub-Saharan Africa to deal with the issue of unemployment among the years?  Thank you.

CHAIRPERSON:  Good.  Okay.  Yes, ma'am.

MS. KONE:  Je suis Madame Koné Solange de la Côte d'Ivoire. J'ai deux petites questions.  La première c'est la question de la réduction de la dette de nos pays.  Nous avons participé par moment a’ l'élaboration de nos (Dsrp ?) mais on n'a pas beaucoup de vision sur cette question la.  Et je termine par une question: Quand je regard la table, il n'y a que des hommes.  Est-ce que cela veut dire que la question du genre est encore vraiment un sujet tabou a’ la Banque Mondiale et au FM ?      

CHAIRPERSON:  Never.

MR. LAUDIDA:  Yes.  I'm Laudida from Indonesia, Core Speaker of Indonesian Second Chamber.

My question is to Mr. Zoellick.  What is the main strategy of the World Bank to make, you know, NGOs or civil society organizations more sustainable in terms of funding sources, because, so far, according to my observation, that most organizations, NGOs, are very dependent in terms of funding sources.  Without international assistance, without international donation, they cannot, you know, sustainable.  Thank you.

CHAIRPERSON:  I'm going to go to the back.  Hold your thought.  Yes, sir, with the microphone.

MR AHMMEAD:  Yes.  Thank you.  My name is Ahmmead and I come from Bangladesh, which is one of the most vulnerable countries to climate change.  The World Bank presence in the country has not been identified in taking active role in tackling climate change.

The new case the country assistance strategy for Bangladesh has also the unclear strategy and commitment in climate adaptation and energy access needs.  So if the World Bank undertakes programs in climate financing, my question is to IMF, Managing Director and also to the World Bank, that how does the IMF or WB asses its role (of being)  the right institution in the country.  Thank you.

CHAIRPERSON:  Thank you.  Okay, the person at the table.  Okay.  Come on.  And then get the microphone moving in the back row, and there's a guy way in back who had his hand up.  Okay.  Wait, wait.  You're next, and then the guy in the back.  What I'm going to do is as many as we can get until five after, then these gentlemen each get five minutes left, and, after that, it's up to John Garrison and Jeremy Mark.  I'm sorry, but the clock is our--not our friend.

MR. PETERSON:  Thank you. Mr. Zoellick and Mr. Strauss-Kahn.  Jesse Peterson, Bank Information Center.

My first question is do you foresee an end to the Bank's lending of fossil fuel-based energy.  If so, when?  And how can the Bank guarantee that energy lending activities are utilized by and benefit the poor?  And how can CSOs look to find the evidence that substantiates such initiatives?

CHAIRPERSON:  Okay.  Guy in back.

MR. SINJANI:  Thank you.  My name is Awul Mousarif Sinjani.  I am from Nigeria, from CISLAC.  I just want to know when could the Bank begin to realize that so much support that they have given to so many Third World countries, including my country, Nigeria, many projects that were meant to really touch the lives of people, at the end of the day when you evaluate, you discover that the money goes to private, you know, pockets, because civil society has not actually been mainstreamed to ensure that there's proper execution of those projects.

And in the last resolution that the World Bank had, the World Bank meeting agreed that Country Offices will be encouraged to ensure that civil society is actually involved in monetary and evaluation of projects, especially with regard to the Ministry of Finance.

When can we begin to get this implemented?  Thank you.

CHAIRPERSON:  Okay.  Over here.

MS. HAVYARIMANA: Merci. Je m'appelle Sophie.  Je suis du Burundi.  Ma question c'est sur le financement des activités productives de la part de la Banque Mondiale et du Fond Monétaire.  Pour les pays Africains, s’il ya a des progrès qui sont fait sur la croissance et notamment a’ partir du commerce spéculatif, l’import export, parce qu'il ya moin de risque.  Qu'est-que la Banque et le Fond peuvent faire pour encourager l’investissement des banques locales dans la production?  Merci.     

CHAIRPERSON:  Over there.  Over there.  Yes, and then over here.  Okay.

MS. HIND: My name is Kabawat Hind.  I'm a lawyer from Syria and my question for the IMF and for the World Bank:  When are you going to give special attention for the post-conflict problems in the Middle East, especially for the Iraqi refugees in Syria.  Thank you.

CHAIRPERSON:  Okay.  Over here.

MR. MUZEO:  Merci, Merci Je suis Christian Muzeo je vient du Congo Brazzaville, j’ai trois petites questions que je voudrait poser, la première c’est que on a’ parle’ de partenariat avec la société civile, mais on a pas parle’ de protection de la société civile et je voulais avoir les commentaires évidemment des deux institutions sur les aspects liés a’ la protection des défenseurs des OSE d’une part, et puis d’autre par quelle politique en ce qui concerne le renforcement des contres pouvoirs dans le contexte des pays a’ faible démocratie et par ailleurs, dernière question en ce qui concerne les communautés : quels implications on a pour obtenir que ces communautés puissent influencer sur les politiques du FMI et de la Banque Mondiale ?

MR. PIRESOLI:  Hi.  My name is Andres Piresoli.  I'm from Chile.  I'm an attorney working with the Inter-American Association for Environmental Defense.  A very quick question to Mr. Zoellick.

I'm curious to know what towards COP 16 (Climate Change Conference), what is the aspiration of the World Bank with regards to mitigation and adaptation finance.  What is the World Bank to get is a role on climate finance?  Thank you.

CHAIRPERSON:  Okay.  The gentleman back there gets the last question.  Sorry.  The clock is ruling.

MR. ZUCHEN:  My name is Ranja Zuchen.  I'm a member of Parliament in Uganda. One of the policies that is sweeping across the globe now is public-private partnership, and we see corruption coming up within these private companies through secret contracts, which the government signed with these private companies.  What does the World Bank intend to do, especially in these quotas, which are secret quotas, even when the government have enacted some laws, access to information rights, but then these private companies keep entrenched secret contracts and where these secret quotas breach through your corruption loopholes.

CHAIRPERSON:  Okay.  Thank you.

MR. ZUCHEN:  And finally, how does the World Bank intend to invest in maternal health, where the recent Summit of world leaders acknowledged that they are not going to achieve MDG5 because of lack of resources.

CHAIRPERSON:  Okay.  Thank you.

CHAIRPERSON:  Each of the gentlemen gets five minutes Mr. Zoellick, you had to go second.  Now you get to go first.  Mr. Strauss-Kahn, can you stay?

MR. STRAUSS-KAHN:  I will.

CHAIRPERSON:  Thank you.

MR. ZOELLICK:  Why don't you go first in case you have to leave.  I want to try to answer these more fully.

MR. STRAUSS-KAHN:  Yes.  I see that Bob has a lot to say, so if you can stay well.  The last question was to me, and he certainly can answer for the question which has asked to both of us.  So, I rely upon you.

Well, the question about requirements, a couple of requirements for banks.  You know, it's a very technical question and a very difficult one, but the way you asked the question, which is why there any kind of discrimination against SMEs is an interesting way of looking at that.  In fact, there is no reason to have any kind of discrimination.  The right thing for the Bank is to know whether or not their borrower is reliable, but you can be as reliable being a small enterprise than not reliable when you're a big company.  So this kind of systematic discrimination has, in our view, no reason to be.

By when will we see substantial changes in quota, representation, and all that kind of thing?  Well, it depends upon not you, but the countries.  You know that we made the first reform in 2008.  It's still not implemented two and half years later.  Why?  Because one thing is get an agreement in the Board.  The second thing is to have the Governors, meaning the Finance Minister in the case of the IMF, voting.  That happens rather rapidly, it's a question of weeks.  But then, in many countries, almost most of them, you need to have some kind of parliamentary ratification, and that may take months or years.

So the question is, if countries are interested in implementing a reform, they have to put this on their agenda.  I can understand that IMF reform is not on the top of the agenda of most of the governments.  Nevertheless, if they never go to Parliament to have this ratified, it will never be implemented.  The 2008 reform which, for instance, was clearly in the interests of African countries, because they gave the African countries a Second Alternate.  African Directors of the Board of the IMF have a lot of countries to take care, and so the decision has been made that they will have a Second Alternate, but that needed a change in the treaty. It's still not in place, because over 15 African countries still not have done this two-and-a-half years later.  (This delay effects) not only African countries, I can tell you. So we can go as fast as we can, but then the political process in the membership is out of our control.

Then two questions on almost the same topic.  The first one was in which respect do we asked local offices to engage with civil society organizations, and another on how to be involved in this decision-making process.

Well, we do ask people in the field to eng      age (with civil society) as much as possible.  Of course, they had their own work to do directly with the authorities.  But we do ask them to engage systematically, different kinds of organizations depending on the different trips they're making.

The problem is not only to meet, but to be able to take on board what you are saying.  And here we find one of the problems that we need to solve together.  We are, I'm talking on behalf of the IMF, an organization where the members are the countries and the legal representatives of this are the governments or the central bank.

So the people we're supposed to talk with and negotiate with are the governments.  We're not supposed, I'm not saying it's forbidden and we do, discuss a program with any other party.  We could be blamed, in the process of elaborating (macro-economic) programs, to disclose some information that has been given by the government.

So I don't think this is an impossible wall to breach.  I don't think it's impossible to change, but we have some limitation in our own capacity, from our own member (governments), to speak about sensitive questions with people outside the government.

So we need to find a way.  We already do (engage) but to take you more on board, we need to find a way, an agreement with the membership, to have a status, I don't know how what the name could be, for civil society organizations so that we could engage with you on a more official basis. It could be some engagement (which respects) secrecy so that sensitive information will not be disclosed by yourself to other people.  So we need to think about that.

On the question from the lady from the Philippines on deficit or growth.  Well, as much deficit as sustainable, as much growth as affordable.  The choice cannot be put exactly in these terms.  Some countries are just unable to have growth, because the deficit is so big that confidence has totally disappeared.

In this case, you have to first address the deficit.  Most countries have a deficit that is difficult, but still sustainable, and then all effort has to be put on growth.  Don't fool ourselves, without growth the debt ratio, meaning the ratio of debt over GDP, will increase just because the GDP will not big enough.

So it's a very country specific question or answer, and we cannot have an answer which will fit for all situations.  The problem today, certainly in the medium term, is to get to more sustainable public finance, but in the short term the question of avoiding any collapse in growth is of primary importance.

Haiti.  Well, a lot has been done, but probably not enough.  As you know, Bob will talk for the World Bank.   We did all what we can, canceling all the past debt of Haiti, which is not easy for an institution like the IMF, because the money has to come from somewhere.  The money which has been lent to Haiti, as for other countries, comes from the membership.  So the membership has to agree for this cancellation.  If not, there is no possible cancellation, and so we manage to convince the membership that we had to do it.  It has been done.

What we also provided to Haiti was immediate support for the economy to restart.  In the terrible situation where Haiti was after the earthquake, the whole economy was stuck because of the inability of the Central Bank to provide bank notes or things as simple as that.  So you had to rebuild the ability of the economy to work, and that has been done, I think, rather rapidly, which allowed for the slow and timid restart of the economy.

Now we have a lot more to do, and we are committed to do that.  We have a lot in the IMF, and I guess in the World Bank, of meetings with Haitian officials.  Your question now was how to help.  I think that you can help in a different way.  I'm not going to elaborate here.  But certainly, civil society organizations in Haiti have a role to play.

Bangladesh.  Well, we have different kinds of tools to deal with low-income countries, most one being the PRGF, the other one being what we have developed as a post-catastrophe tool.  In the case of problems like the one that Bangladesh has experienced in the past, this kind of tool can be used.

But, of course, the question on climate change is more a question that Bob will  likely answer, as climate change is a question which is more in the basket, or in the topics that the World Bank is addressing rather than the Fund.

I don't know if I should answer in French to the question asked in French, I think it's just polite to do so.

 La question de Sophie du Burundi est juste, il faut que les programmes que nous mettions en place soit capable de pousser a’ des investissements dans la production et non pas dans des investissements spéculatifs. Il  reste que nous définissons FMI un cadre économique, en suite cest au gouvernement de mettre en œuvre les mesures, bien sur on peut aider a’ les orienter mais nous ne définissons pas actions par actions ce que le gouvernement va faire par exemple on définit des objectifs d’inflation, de déficits de taux de change mais pas tel ou tel politique en détail, et donc dans les programmes ou les projets détaillés c’est plus l’affaire de nos partenaires de la Banque Mondiale, c’est la qu’est le partage des travails ; A nous le cadre macro économique a’ eux les projets concrets à mettre en œuvre. J’en profite pour passer à la question du monsieur du Congo, c’est très difficile de trouver les moyens pour nous de favoriser les contres pouvoirs, parce qu’encore une fois se sont les états et donc le gouvernement légitimement élu qui sont nos correspondants. Pourtant dans nos programmes nous essayons de mettre en place des éléments, je disait tout a l’ heure, de politique anti corruption, de mise en place d’institutions démocratiques qui sont des institutions de protections de la vie civile, se ne sont pas des institutions de protection directe des organisations et peut être qu’on pourrai réfléchir a’ cela, mais il est concevable que cela dépasse notre rôle qui est celui d’aider a la stabilité économique, la stabilité démocratique, repose sur la stabilité économique, mais nous n’avons pas une mission qui nous permet de nous avancer au delà des questions économiques.

Last question on from Syria on post-conflict.  We do have some way to help post-conflict countries, and we have a program in Iraq, for instance, not specially dedicated to people coming from Iraq to Syria.  It's a problem for Iraq, not for Syria.

But nevertheless, we have developed some capacity to intervene and to directly focus on post-conflict situation, which is now under the headline of a fragile situation on fragile states. That's something on which we are going to devote more attention in the coming year for the good reason that there are more fragile states after the crisis than there were before.  So we clearly need to take this into account.

I'm sorry that I have to leave you.  Just a word to thank Jo Marie and to thank the speakers, Dickson and Bishop Zac, and, of course, my friend Bob.  Your role (civil society) is really important.  The CSOs have emerged in the last decade as an essential vehicle for conveying a lot of information that we are not able to have directly.

And so, frankly, you have played a major role in the reforms that have taken place in an institution like IMF.  Sometimes the proposal comes a bit disorderly.  Some of the CSOs are interested in one topic, some others in other topics.  We have to try to make a synthesis of that, but, at the end of the day, a lot of the reforms that have been put in place have been initiated and supported, sometimes criticized, for going not fast enough or far enough, but supported by your organization.

And over the past year, for instance, the Fund staff has engaged in dialogue with many CSOs on a very key issue, financial sector reform and financial sector taxation.  We had many sessions, working sessions here, listening to what CSOs had to say in this field or another, and really we're committed to deepening this process of consultation in the coming months, and the coming years.

So I'm looking forward to hearing from you some feedback from this meeting, and the feedback from the working sessions that you may with from IMF staff to try to continue to transform the institution with your help.

So I have to apologize, but, you know, these days are really, really busy. I cannot be too late (for my next meeting) as I was late when I arrived here.  Everybody has noticed.  So I first apologize for being late when I arrived, and secondly, I apologize for leaving before listening to Bob.

But I'm sure that I won't have anything to say to correct what he says.  I rely totally upon him.  So I have no problems.  Thank you.

[Applause.] 

CHAIRPERSON:  Bob Zoellick.

MR. ZOELLICK:  Okay.

CHAIRPERSON:  You are free to stay as long as your agenda allows.  We're delighted to listen to you, and we appreciate your adding some additional time to this event.

MR. ZOELLICK:  Well, my constraint is that I'm doing an event with a different group of civil society groups within the National Geographic, where we're trying to preserve species, and in particular we have an effort to save the 3,500 tigers left in the world.  But that is just about 15, 20 minutes away.

First, the question from India that builds on the institutions, market, state, corporate sector, and you asked whether we are taking initiatives. The answer is yes, we're taking initiatives on all fronts.  In the corporate sector, we have an institution called IFC, our private sector arm, and in fact India happens to be the number one location for investment.  It's over $3 billion, and we also mobilize about an extra $1 billion of investment.

But at the same time when we have (private sector) partners, we tried to upgrade the standards.  We encourage things like the Equator Principles that become sort of global standards for good corporate performance.  But you emphasized state, and, in a sense, as we talked about governance, that's at the heart of what we all have to be about.  I can give you a sense of encouragement (by explaining) that in this crisis we found more and more requests from  that are our client countries --we don't--we can't force people to do things, but we take their response--to try to understand how they can have better management, how they can have better fiscal management, how they can have better procurement.

And if a country is a federal country, we're often now working at the state level on some of these projects.  So people realize that this is in their own interest; otherwise, they lose the money and it builds a better system.

But I also think part of the idea is how to make markets work better, including for poor people.  You know, frankly, I always remember this comment that former President Zedillo of Mexico made that for the poorest people the problem isn't too many markets, it's often too few markets.  They can't borrow.  They can't save.  They're not in the system.  So that's a part of--and some of the other questions you have go back to that.

On the new rules for global finance, you asked when would speak up on the bank capital.  I've been doing so for two years.  It's all over the website, because I started with trade finance, knowing that field pretty well.  Pascal Lamy, the head of the WTO, and I have led a campaign that said you're going to make it harder for trade finance for developing countries if you have higher capital levels for doing trade finance.

So we've pressed very hard on that issue.  You get an advanced notice, because tomorrow morning I'll be doing a PowerPoint briefing of all the Governors, and what I'll be mentioning is that for developing countries as a whole, we are seeing foreign direct investment go up, access to bond markets go up, but a net negative inflow of banks, in part, because I think of some of the capital standards and other regulatory issues.

So a couple questions about growth of small- and medium-sized enterprises and local banking and services.  This is at the heart of what we do, both through the Bank side, but also IFC side.

Let me just give you a practical example, although this is a little smaller than small- and medium-sized enterprises.  During this crisis, we saw that a lot of micro-finance institutions didn't have access to money, because they are not the depositories.  They relied on sort of cross-border financial flows.

So our colleagues at IFC put together a special fund, and we got some money from the Germans and others to create a revolving fund of credit for some of the micro-finance players.  But your question couldn't be more timely because looking to the G20 meeting, the coming out of the Toronto meeting, the Canadians wanted to focus on financial inclusion.  They've got some contests related to this.  So we're going to try to support those, but, in addition, I think there's an opportunity here through the G-20 where we can try to, again, press different models.  I was talking about this with the Gates Foundation this week about different ways that, as you know, mobile phone banking, savings, and others.

So we're trying to use technology to this end, and when we invest in local financial institutions it's to spread their local ability to finance, including energy efficiency.    We even have a partner program called the Linkages Program that works with foreign investors.  I remember visiting an energy facility in Mozambique where we worked with the plant to be able to link it to small-and-medium-sized enterprises so that they could provide some of the goods for it.

The question from Uganda was asking whether we encourage our offices (to engage CSOs).  I thought I was pretty clear on that, but let me be very clear. Yes, we encourage our offices to do it.  And if there are gaps, let us know, and we'll try to find out (what is going on).  I not only said we encourage our offices.  I said I'm trying to come up with money for you to do it, which is a pretty good form of encouragement.  But, you know, I'm sure there's some areas where there's some slippages and things, but also, you know, this is an obligation for some of you, too.  I mean you have to figure out how you're going to engage.  We all can't just complain on these things.  There are going to be a lot of opportunities here.  You're going to have to figure out, you know, how you're going to focus your energies on this.

There are a couple of questions on education, which I'm very glad you raised, because it's a very important issue that we're focusing more on in different ways.

It came in different ways.  One was higher education and sort of job skills training.  One of the interesting things that we've seen develop in the education field in a lot of countries in the immediate post-colonial period that had a rather elite structure of a small number of people with university educations, is they put a lot of money into primary education, as they should, and then some in secondary.

But for overall growth, we also see it's very important to try to develop higher education and technology education, and (for this reason) now fund centers of excellence in sub-Saharan Africa.  We're trying to use information technology.  This is another topic we talked about with the foundations whether professors might have dual appointments in some cases. But you and another colleague also mentioned about connections on the job side.  And this is critical.

I had an event with the Prime Minister of Tunisia just yesterday morning, I think, where Tunisia has invested a lot in education, including university education, including women's education.  There are a large number of unemployed women.  And so this transition, and it has been a particular problem in the Arab world, from education to workforce is a critical topic. It's one that we actually I talked about in a couple meetings with Ministers today, from South Africa and others about linking it to job-based skills.

And so, again, my own sense is this is a topic where, now and then, you see one of these things start to take off.  There's a lot of interest in this, and ways that we can connect, for example, to be more efficient in some of these areas.  We're working with Botswana to develop a private sector university in science and technology.  And again how to try to use technology so that you don't have to have all the investments in bricks and mortar that you've had in the past and maybe can integrate across a different geographic space.

A question from Bulgaria about social entrepreneurship.  This fits at the heart of what we're talking about in terms of trying to reach out to more people and ideas.  You asked where?  We have something called the World Bank Institute, and they've been at the heart of some of these innovative ideas we've come up with.  We're trying to create competitions in this area, and this is another subject we actually discussed with the foundation world.       I think this has a huge potential and opportunity.  So I'd like to figure out other ways that we can support this.

On the question of Haiti.  Thanks for your offer to help.  We'll try to follow up and see how we can connect you with it.  You asked a tougher question, which is why  Haiti had these difficulties.  My colleague here, Caroline (Anstey), had been our Country Director for the Caribbean, including Haiti, so she's more of an expert.

But a short answer is history has been pretty cruel to Haiti over the years, and including some pretty bad leadership.  As it got through some of those phases, frankly, there was a serious security issue, and the security issue I think impeded much of a reasonable chance at development.

One of the sad things for President Preval was he just felt he was starting to come out of this (difficult period), and then you remember there were the three bad tropical storms, and then after that, then they had the earthquake.

So I think the issue, and I'll come back to this because somebody asked about post-conflict societies, in these situations  is that you have to have a combination of security, governance, development.  Right now, I think one of the major concerns is the process of getting the rubble cleared so we can get shelter.  At the same time, and I'm encouraged by this, our private sector arm the IFC, has worked (to support) a Korean company that is reinvesting on the apparel side.  We're trying to create the jobs, because this is not solely a governmental issue.  It's got to be about jobs creation over time.

My own sense is that this is another area where there can be some interesting work we've learned from the community development side.  I mean the agricultural and small communities, I think as you get through some of these early phases, this is another side for investment.

But again, I'll be very frank with you.  There were over $5 billion pledged to Haiti.  We created a multi-donor trust fund to make it easier on the Haitian government, to deal with one player.  Of that $5 billion, only $500 million was pledged to us, and I think we've only got about $200 million of that.  Most of the (WB’s Haiti Trust Fund) money that's come has been from us, because we've actually put the money in already.  So this is an argument, again, to press governments to keep on some of their commitments.

On the question from Cote d'Ivoire about women, I'm glad you asked this as -it's a point that I have put a lot of attention to.  Over half the officer appointments at the World Bank that I've made have been women.  You were followed by an Indonesian Parliamentarian, and he will tell you that one of the recent people I've brought in at the level right below mine is Sri Mulyani Indrawati, who was a very successful reforming Finance Minister.  We had some questions from Nigeria.  Another (appointment) was Ngozi Okonjo-Iweala (from Nigeria), who was a successful reformist Finance Minister. I did bring in one man as a Managing Director recently from Egypt, Mohammed Mohideen.

But I agree with you about the focus on gender, but frankly I'm going to also say it's important to focus on developing country personnel.  So this is the first time in the Bank's history that all the Managing Directors and the Chief Economist are from developing countries.  That's something we need to spread throughout the organization.

The Indonesia question was about funding.  And here, as I alluded to, part of our challenge is, other than the IFC which does the private sector side, we fund through governments and that always poses a problem. We can now and then maybe encourage the government to have a project that draws in civil society, but some civil society groups don't want to be funded by the governments.

So, as I said, what we've come up with, and this is where I want to thank the Japanese government and others, is to have a trust fund to try to do separate funding.  And through the World Bank Institute, we were able to get some funding for the Development Marketplace for civil society groups that would come up with novel ideas and try get do some additional funding.  And that's frankly one reason why I wanted to reach out to the foundation community.  I thought they may be able to help on the private sector side on this aspect. But if people have other ideas, I'm all ears because I understand this is a critical aspect to make the thing that we've talked about work.

On Bangladesh and climate change, it's ironic.  I just met your Minister of Finance yesterday, and we talked about the criticality of Bangladesh climate change issues, both the sea level and the mountain issues.  The Bangladeshi Minister attended one of the meetings that I call the “Bali Sessions” that because the first one was held in Bali.  I've hosted them at every Annual and Spring Meetings, because I want to get the Finance and Economic Ministers to be talking about climate change. I don't want it just to be an environmental topic or a foreign ministry topic.  So I'm not sure why you feel we're not doing things in that area, but you mention some documents, so we can try to check on that.

On the question about the Bank funding of fossil fuels.  Yes, we do continue to fund fossil fuels, and let me explain one reason why.  Through IDA, the fund for the poorest, we provided 24 million people in poor countries access to electricity. We have a lot of people from poor countries here.  Are you (Mr. Peterson) from the U.S.?  Yes.  The U.S. generates 50 percent of its electricity from coal.  It's actually come down a bit.  And so here's our real difficulty, and this came up when I talked with the Indian Minister today.  He said, we'll work with you on climate change, but you can't deny poor people electricity, okay?

Now, I'm not saying this is your group.  Some groups won't even allow us to fund hydroelectric projects, and we've dealt with these issues with great sensitivity in Uganda and other (countries).  So we try to deal with displaced people.  We try to deal with the environmental issues.  But the reality is we're not going to produce enough electricity in the world through solar-run alternatives to make sure all the poor people have electricity.

Now I'm with you about trying to engage and promote these things, and there was a question about COP 16.  And we're moving more in that direction, but I honestly feel, and this is where I obviously may not be able to persuade you, but maybe others.  You're not going to get developing country people to work with you on climate change if it looks like the choice is they can't have electricity, okay?

I don’t mean to say that we should try to live without electricity.  Go visit villages that don't have electricity.  And so there's a lot we can do on energy efficiency in places.  There's a lot we can do in different gains and we certainly don't want to do any more fossil fuels than we have to.  But I don’t really think we can fairly say we're in the development world and cut all (fossil fuel energy sources) out, at least that's just my view.

The question from Nigeria was (WB) money going to corrupt (officials).  If you have information on corruption, let us know.  The head of our Anti-Corruption Department has been a very tough guy in South Africa.  He led a very tough group called the Scorpions and will go after it. It's just interesting.  Two of our (senior managers), as I mentioned, Ngozi Okonjo-Iweala is the Managing Director and our Vice President for Africa is Obi Ezekwesili. These are two of the leading reformers in Nigeria.  I think Obi helped create Transparency International.  So we certainly want to try to work on those issues because I agree with you that corruption is not only going to be a problem of loss of money, but frankly as we've all discussed, it rots away people's confidence in institutions.  And I think that's just as dangerous.

The question from Syria about post-conflict.  This has been a very important area for us, because Paul Collier wrote about it and popularized it with a book called the “Bottom Billion”.  One of the things we've just seen is that they are certain countries that it's a combination of security, development, governance, and ultimately legitimacy.  Our next World Development Report, the one we just had was on climate change and development, will be on this critical issue (of conflict and development).  We obviously are doing (post conflict reconstruction) work in Afghanistan, Liberia, Haiti, and others.  We also fund work in Iraq.

And we can follow up.  I've had some discussions with Iraqi officials about this issue, about returnees and creating the right economic environment.  We can see whether it's something that they'd be willing to engage us with on this.

The question on protecting civil society is a very important one, and I know a lot of you frankly display great courage in different situations.  It's not easy and, as Dominique said, you know we're not a state.  I don’t have a police force, but there are things we can try to do, and let me explain some of the things we try to do.

Some of you are parliamentarians.  When I go to developing countries, I try to meet parliamentary members as well as meeting with the executive branch.  We also try to work with other groups.  We have an international group of parliamentarians to try to offer support and attention.

Obviously, the more we can (support) transparency and better governance, that creates a better context.  Most countries understand that (to promote)  development they need effective rule of law.  This gives us an opportunity in some countries to work with judiciary systems.

In some countries the issue even comes down to the police force, and that's a problem.  Under our charter, we haven't and don’t think we could (support) police force work.  One of the things related to this post-conflict environment is we had a hard time finding any place in the international system that would help people develop police forces. The U.N. is starting to do that, and I think that's going to be a critical need.

On the secret clauses, our contracts are open. I guess you (Zuchen) are a parliamentarian.  The best thing I could do is urge you to demand that your government be as transparent as we are.

On COP 16, I'm really glad you asked this, because I think this is going to be a very important meeting after the frustrations in Copenhagen.  You asked particularly about the financing, and I touched on this briefly in answer to the Bishop's question. The Climate Investment Funds have been very effective with about 40 or 50 developing countries, from energy efficiency programs and solar, to deforestation.  And what's been most important, I think, is we've created a governance arrangement that is equal for developed and developing (countries), and, as I mentioned, we've been able to bring CSOs into the process.

And if you think that every government thought that was such a great idea, think again.  But in terms of the return, in a world where money is short, the fact that we've been able to leverage this from 10 to one (dollars) is something that I think is going to be very important.

But the reason I'm taking this a step further is that I don't know what will be accomplished at the treaty level.  Most of the reports suggest it's an uphill struggle.  But I think it would be a terrible mistake to pass up the opportunity to put down some building blocks in Cancun, where you can make progress.

There's a wonderful opportunity in the REDD (Reducing Emissions from Deforestation and Forest Degradation in Developing Countries) area, in the avoided deforestation area.  We've done some work alongside the Norwegians and others.  It think you could get 130, 140 countries behind a pretty good process on that.

Energy efficiency.  Some of the technology, and for your question back on the energy issue, the other thing we're looking at is various off-grid possibilities which can help, for example, in Sub-Saharan Africa in the solar area.

We also have to plant some seeds for the future.  And let me just give you an example.  You know, the estimates are that avoided deforestation could save maybe 17 to 19 percent of the greenhouse gases.  Some people estimate that soil, effective use of soil carbon, could be equally important. But frankly, people don't know as much about how to measure it, how to do the right tilling methods, and then how to build it into an international system.

So the way that I've watched international processes work is sometimes you have to plant the idea, get the work going.  We've been talking with some of the people at the U.S. Department of Agriculture on their work on this.  So there are critical areas that I think could be the building blocks of future work, and it would have another benefit.  People would see that things can be accomplished with developed and developing countries, and you'll build more support for this over time.

And that really will also require some attention to some of the groups that feel they've been left out.  I'll be meeting some in the next couple of days.  Small island states feel particularly victimized.  Some of the mountain countries, and frankly sub-Saharan Africa has felt that it hasn’t gotten the benefits of this.

So, like Dominique, I want to thank you.  I know that you've got a great diversity here of different views. I'm sure it must be frustrating at times for people.  We just have this session and then one at the Spring Meeting.  But the reason we're trying to create the open system on the web and interactive data, is so this (dialogue can occur) on an ongoing basis.

We want to do this through our Country Offices, too.  Take the access to information initiative.  Look, we'll make mistakes on this.  I saw the FOIA process come in the United States, so I'm not asking you to be overly patient, but let's try it.  We'll make it work, and we'll learn as we go forward.

But I do think what we're trying to do as a more open institution is not just a concession to people.  We honestly think that it's an important part of making development work more effectively.  So thank you.

CHAIRPERSON:  I think we should give Mr. Zoellick a hand.

[Applause.] 

CHAIRPERSON:  For being the longest standing person, and he does have to run.  So thank you very much, and I also want to thank the Bishop and Dickson for summarizing so many ideas from their colleagues and peers and to all of you for being concise and tight on very, very important issues.  I know it's hard.  You wait the whole time, and you finally get 90 seconds, and I cut you off.  But now it's your reward.  Go over to the World Bank.  Follow Jon Garrison.  And he will lead you to an open reception at the World Bank.  It is at the 12th floor Gallery, and your hosts are Caroline Anstey, who's here, and Caroline Atkinson, who was here.

So have a good time.  Thank you.  You're great.  No wonder change is coming.  You are doing it.


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