Transcript of a Civil Society Organizations Town HallSeptember 22, 2011
MS. SRINATH: Good evening. Just to say that we're going to start in a couple of minutes. Ms. Lagarde is on her way here, so a couple more minutes.
Actually, maybe I should use the time to just talk about the format that we will follow today. I am essentially just going to be a traffic cop. That's my role.
Once Christine Lagarde gets here, she is going to have a few opening remarks to make, and then I am going to hand you over to Laila Iskandar. Laila is, among other things, representing the Global Recyclers without Borders. She is from Egypt. She has over three decades of experience in civil society.
Once Laila has spoken, Mr. Zoellick is going to respond, say a few things--I know that lots of us are really keen to hear what exactly he means about this new engagement with civil society--after which Milwida Guevara will speak. Milwida is President of the Synergeia Foundation in the Philippines. She has also been in her previous life Deputy Finance Minister of the Philippines. She now works to ensure that children have access to basic education.
And once Milwida is finished, we are going to open this to questions.
But we do have a somewhat hard stop at about 6:30. I know that Ms. Lagarde has to leave by 6:15, and we need to close this by 6:30. So I am going to ask you up front to really try to be as brief and succinct as you can in your interventions. The idea is to get as many questions and comments as we can, rather than let a few people monopolize the limited time that we have.
So those are the rules of the game, and we will now just wait for the new head of the IMF.
MS. SRINATH: Sorry--one other housekeeping announcement.
On your headsets, should you need interpretation, Channel 1 is English, Channel 2 is French, Channel 3 is Spanish, and Channel 6 is Arabic.
MS. SRINATH: So this is quite a change from last year, I believe. Last year, there were four men and one woman on this panel. This is a sign of the times, I hope.
Welcome, Christine. This is for you, I guess, your "coming out party" for civil society, so we are going to let you start us off.
Over to you.
MS. LAGARDE: Thank you very much, and my apologies for arriving a little bit late for the beginning of what you called my first "party" with you all; and apologies to Bob, who has been a companion for the last few hours and who has been always on time when I am late.
Let me first of all say that I welcome this Town Hall Meeting, and I very much value the input that you can give and the relationships that we can build. I know it has been the case--I am a newcomer to something that exists already but to which I hope I will contribute.
And I am particularly pleased, I must say--and you have just noticed it and mentioned it yourself--to see that there are many women in the room. I know that the World Bank under the leadership of Bob has really put gender at the top of the agenda, but there is nothing like a room full of men and women to actually demonstrate that gender is really addressed and is demonstrated in real life. In financial circles, it is not always the case, and it is extremely comforting to see the community here at-large.
The Annual Meeting as it begins to unfold now is really coming at a critical juncture. I suppose many other Managing Directors for the Fund have said that in the past, but I can tell you that I sense at this very moment a sense of urgency, a sense that leaders of the world understand that they have to act--they have to act collectively, they have to act boldly--to address the issues that are currently looming in the advanced economies. And it is interesting to see that there is a bit of a role reversal at the moment where the emerging markets and the low-income countries have fared the crisis a lot better than some of the advanced economies.
So we need to work together. The advanced economies need to work with the emerging markets and with the low-income countries. There is a lot that we can learn from each other. I heard some of the Governors of Asia Pacific and Latin America, for instance, yesterday indicate how much they can share in terms of crisis management, in terms of experience of having gone through crisis in the past, how much they can actually communicate, share, and demonstrate to those countries in the advanced economies that are going through difficult times at the moment.
Another anecdote that I will share with you as well, which has to do with a country within Europe that has just gone through a successful program--that is Latvia. It is not a huge country, but a country that took very, very strong, front-loaded measures to actually deal with the issues that it had--excessive debt, slow growth, lack of competitiveness.
And when I saw the Prime Minister of Latvia, I actually asked him what were the reasons and the lessons for the success of the program--which it is, because it will be completed before the end of the year--and he said it was total engagement on the part of the leaders, total engagement to actually explain and describe what is needed and to properly educate with appropriate information. But more importantly, he said, what was critical was actually the dialogue and the relationship that we decided to have with all members of the civil society, in particular union leaders, but also all nongovernmental organizations that represent civil society. And he mentioned the fact that without that dialogue, without that close relationship and the sharing of information, he thought that it would not have been as successful as it had been.
So that says a lot just in practical terms about the value of the relationship that must be had between leaders in the countries, in the Regions, in the economies, and the representatives of civil society. It also demonstrates how much of a relationship we need to have and how engaged you need to be with us so that we can actually do a better job in both surveying, analyzing, providing technical assistance, taking a holistic view of the problems and not looking at things or looking at the economy from a small angle, from a small prism.
We need to provide multi-surveillance analysis. We need to provide multifaceted angles to our analysis. And we need to take into account in particular the social dimension of whatever economic policies, macroeconomic policy, we recommend to our shareholders, to our members.
So, without taking the floor any further, I would just like to tell you how much myself I will commit to that dialogue and will be available to receive your recommendations, your advice, and to listen to your feedback and to be available together with the team, together with the staff, and certainly together with members of the Board who are also very keen to adopt that approach.
Now, it might be slightly inconsistent with what I have just said, but I will be with you until 6:15 on the dot, and then I will have to, if I may, excuse myself because I have to participate in some quite important reunions---not reunions, but meetings--as well.
So thank you again very, very much, and you are at home here.
MS. SRINATH: Thank you.
Laila, you have done some extensive consultation and are going to now speak as a voice of civil society, so over to you.
MS. ISKANDAR: Yes, and I am really happy to bring you some news about our work on six continents with millions of people
We have tested innovative approaches such as mobile banking and others, documented best practice, shared it. We have been responsive to changing realities of real people and communities. We have professionalized our practice, modernized our methods, and transferred our know-how across boundaries and Regions. We have formed global coalitions, adopted unified visions, agreed and advocated on these global issues. We have issued joint declarations, represented millions of people in global platforms. We have also partnered with universities, think tanks, and foundations, conducted assessments, research.
We have developed materials to use in our professional practice, and we have translated these into more languages than the UN uses, more than the six.
We have come here to listen to you and to speak to you on a few things that have been troubling us for some time.
The first is this whole notion of growth, growth with inequality. We have noted the data on the overall progress on the MDGs masks inequalities based on gender, income, and location.
Millions of women and girls, especially those living in rural areas, continue to live in poverty and exclusion. Unemployment has risen. Malnourishment and hunger are growing, especially with rising food prices. Control over land, the foundation for food security and other productive resources, is eroding.
The Arab revolutions have shown us that growth with inequalities is untenable. It does not guarantee stable, cohesive societies. Growth in our countries bred the conspicuous consumption of a corrupt ruling elite. It did not prevent unprecedented high levels of youth unemployment or the proliferation of slums and the violation of our rights to live with dignity and respect.
We are eager to explore new development paradigms which focus on the distributional aspects of that growth and the centrality of jobs and economic justice.
We would like to work with the Bank to select the policies and programs which are best suited to achieve prosperity for all and not just for the top 20 percent.
We hear the predominant bemoan our growing numbers. Population growth is a problem. But we do not hear the corresponding discourse about the path that a globalized economy based on excessive production and consumption is taking us, a path which directly impoverishes women, especially rural women, and which depletes our Planet from its resources.
We hear about the Bank approving fossil fuel projects to satisfy this growing global demand and consumption, while we know it will not reach the poor widow in that remote village so that she can help her daughter with her school assignments.
We have seen the energy produced by mega projects attract corrupt players at that nexus between government and the corporate sector, so that energy supply and energy subsidies are directed to the corporate industry and not to the poor.
Can we work with you to develop energy policies, conduct assessments of local energy needs, participate effectively in decisionmaking, facilitate the public discussion and review of large infrastructure projects, in order to guarantee democratic accountability and the sustainability of the environment, the livelihoods of the poor, and the safety of our Planet?
We can work with the World Bank Group to support fossil fuel projects that have as their sole purpose energy access for the poor.
We can provide the Bank with information on all costs--damages to public health, welfare, and the environment--of a given project. We can support it in making decisions to go for new, renewable, and energy-efficient alternatives which demonstrate that they are the best for delivering energy services to the poor.
We have a wealth of information that differs from the information that you have. We want to share it with you. We can tell you about the social and environmental impacts and consequences of these mega projects on vulnerable communities.
Our consultants care about the communities they research. They are highly-qualified experts from the energy sector, lawyers, financial analysts, and development experts. Can they start working with the Bank to explore new ways of looking at things, to propose new mechanisms and legal instruments to allow communities to access information and to act for their social, economic, environmental and human rights?
They would be happy to work with the Bank to conduct assessments which reflect reality on the ground. They would not be hurried, would not be biased toward government views, and would enjoy transparency.
Now, can the Bank change as fast as young societies are changing? The Arab Spring has shown that young people will not wait. Over the past couple of days, we have been told that the Bank is a large bureaucratic agency which needs time to change; but how fast can that happen? Young people may not give the Bank to change at the current pace it is changing.
We can help governments and the World Bank and a number of accompanying communities, for example, the Global Agriculture and Food Security Program, where we work with small farmers and producers; the accompaniment toward empowerment and the transformative process, not just the logical framework of a project.
Each country and each community is different. We are ready to assist the Bank with new, tailored approaches which have worked at the grassroots and which can be scaled up--not with approaches which help keep corrupt power elites controlling wealth. We would like to assist in breaking the lock on policy, to depart from proposing a single set of reforms. So, can we invite the Bank and the IMF to open up policy spaces that promote alternative and diverse approaches? We are eager to do so, because we consider both institutions influential funders, proponents and enforcers of economic and development policies and global opinion leaders.
So, a question: Is the World Bank still challenged by having to deal with the same corrupt governments which have denied us our rights, our prospects for a future with dignity and hope? Is there any room for communicating with citizens to access more valid information?
On the safeguards issues, the World Bank has led the way on the development of strong safeguards. We are concerned that they might be watered down, and we would like to work with you to engage the larger civil society audience in public consultations. We would like to expand them to add the rights of disabled people. In many places, there is national legislation to protect people's rights, and communities have come to count on those safeguards on all projects, not just World Bank.
We commend the Bank on taking a firm stand on transparency and accountability measures to the point of holding off loans to countries where governments would not comply with those measures.
We are concerned about the Program for Results proposed approach and feel that it would eliminate the Bank's 20 years of social and environmental safeguards. Can the Bank commit that all relevant safeguards policies for investment loans apply to the Program for Results?
We would like to share our problems with mega projects. They are still fraught with corruption in the tendering process. They do not reduce the cost of production or create jobs in a significant way. They saddle countries with debt. They have negative social impacts on people, particularly the poor.
We want to offer you our substantial experience in job creation. In the recycling sector alone, we have created seven jobs out of every ton of waste that a city generates. Investing in incinerators, again, by the Bank and others will destroy the materials on which millions of jobs are based and where millions of families have sent their girls to school from the income generated from recycling. It would also have severe impacts on the climate and the EPHS [ph.]. Incinerators produce more CO2 per kilowatt hour than any other power plant, even more than coal.
In concluding, now that you have listened to our voices, how will we conduct the business of development together? We would like to be your principal partner. We would like to sit at the decisionmaking table, to plan ahead with you, to design policies and programs, to open up policy spaces for others.
What concrete actions can we start planning for together? A new orientation toward distributional justice, growth with equity, and jobs for all will required, for one, new learning among World Bank economic experts, consultants and staff. We would like to place our knowledge at the service of the Bank. Our research, conducted over decades, will need to be shared, disseminated and publicized in the same manner with which the Bank publishes.
Finally, governments have let us all down. Try us. Try working with us. We dream of a game-changing Bank that is pro-poor, does not damage the environment, and creates jobs with growth rather than jobless growth. Let's forge closer relationships, starting with your local country offices, so that your dream and ours of a world free of poverty and inequality becomes a reality, so that people can live with opportunity, dignity, and justice.
MS. SRINATH: Thank you, Laila. That's a comprehensive agenda.
MS. SRINATH: Mr. Zoellick?
MR. ZOELLICK: It certainly is.
What I suggest, since Christine has to leave a little earlier and I can stay a little later, why don't--I think you had an IMF one, too--if you want to start with that.
MS. SRINATH: So then, maybe we'll hand this over to Milwida, and Christine can respond after that.
MS. GUEVARA: Madame Lagarde and President Zoellick--[unclear]--I wish we could say it is the best of times, it is the worst of times, but I cannot. We can only psyche ourselves in saying that we will confront these challenges, and this should bring out the best in us. And why not?
The Fund has broken its long tradition of secrecy, exclusivity and rigidity. Gone are the days when all of the Fund documents were marked "Strictly Confidential," and economic targets were cast in stone.
And behold, the Fund has opened its doors to civil society, and Madame Lagarde has even said: You are home. This is really a miracle.
[Laughter and applause.]
MS. GUEVARA: We also celebrate the unity and vision of the Fund and civil society. Both of us share the same vision of inclusive growth, better governance, and homegrown reforms, underscoring [unclear.]
But for this sharing to flourish into a trusting partnership, we need to level off our expectations, limitations, and frustrations.
The first frustration is the level and quality of engagement with civil society. Loans that will eventually be paid by citizens are worked out with governments with nominal and ad hoc consultation with the people.
The frustration is more intense when the Fund negotiates with a corrupt and incompetent government.
While we understand that the constituency of the Fund is our government, we hope and we pray that the Fund will use its tremendous power and influence to be able to pressure our governments to be more transparent and participatory.
On our part, we accept the responsibility of demanding better governance from our governments, although our shortcoming is that in some countries, some of civil society is still disempowered because of the fear of reprisal from undemocratic governments.
The second frustration is the focus on macroeconomic numbers. The numbers may look robust, but their effects on income, investments, and welfare may be perverse, and worse, citizens may feel alienated and resentful of government, weakening the social capital of government.
Because reform programs, as Madame said, have social and political effects, they should not be decided by technocrats and bureaucrats alone. Experience has shown that reforms are better structured, better safeguarded, better owned and better sustained if they are products of extensive consultation and community involvement.
And I think President Obama, for example, can be helped when he is able to engage civil society, because it is only when communities participate that you can introduce structural reforms that tend to break oligopolies and economic capture.
Economic reforms are also about generating income for the people and ensuring that public services benefit the poor. Civil society has successfully demonstrated that needs-based and demand-driven programs are more empowering. Isn't the use of local expertise more relevant relative to the use of foreign advice? Isn't scaling up best practices in our countries more cost-effective than hiring technical experts?
This meeting has provided us and, hopefully, the Fund a better understanding of our comparative advantage and how our efforts can be complementary. We do sincerely appreciate the initial steps that the Fund has taken toward greater transparency, and we will take special interest in your reports and your consultations, and we will use them as inputs in providing greater oversight to our governments.
We will also try to be more constructive in giving our criticisms so that our dialogues can be less combative and more fruitful.
We are hopeful that the participation of civil society in the reform process will not be sporadic and dependent on country representatives. In my country, Mr. Hofman, for example, has institutionalized a Board of Advisors made up of civil society representatives. I hope we can find ways through which they can provide inputs to country negotiations, either as part of a country team or as part of integrative meetings.' The youth, my friends, the young ones, deserve an equal place at the table, not only because the future belongs to them, but their ideals and their powers are awesome.
As a former finance ministry official, I must admit that the real world that I have discovered in the last ten years, particularly that of the poor, is different from what I thought it would be. I have the highest respect for their perspectives in life and have been given the best advice on how to address the problems of poverty. In fact, I could have done my job ten times better had I listened to the poor more.
MS. GUEVARA: One colleague says it aptly--they see things that we do not see.
Thank you very much.
MS. SRINATH: Thank you, Milwida.
MS. LAGARDE: Well, thank you very much.
You are a difficult act to follow, but what I will say is that by listening to you, I hope I can see things that I don't see, and by continuing this dialogue through your intermediaries, through your representatives, I hope we can actually improve not only the relationship but the kinds of products, the kinds of facilities, the kinds of programs that we put in place to help countries and to help economies.
I am not an economist myself, and I very much value the talent of those who are, but I also appreciate the shortfall of operating by the textbook and being a dry economist--not to say that the IMF talent is only made up of dry economists--there are also lots of people who have been on the ground, who have been in the fields, who are coming from different life experiments and who are coming from different backgrounds, different origins, different gender, obviously. And it is a very multinational, multi-background, multi-experienced group of people who are really doing their best and who are dedicated to helping the membership.
So I don't disagree with anything that you have said, and you can certainly rely on me to continue the transparency policy that has been put in place.
You know, sometimes when in the Board, we discuss a particular matter, and when there is a paper which is circulated, I am often surprised to hear that, yes, it will be made public as is, and yes, the minutes will be available, and yes, there will be complete communication and openness about the way the Fund operates, the Board interacts with the Management of the Fund--and I think that is good. But coming from the outside as I do, I am happily surprised that there is that level of transparency and openness.
I take your point about dealing with either corrupt or incompetent or sometimes corrupt and incompetent governments, and yes, you are right that we have to have that high on our agenda and that it should be part of the dialogue that we establish with, number one, the membership, and number two, the parties and the country concerned.
In terms of designing the programs, I think we have changed as well over the past. It is not necessarily my doing only. It is certainly my determination, but my predecessor certainly had at heart to make sure that the social dimension was also included in the design of those macroeconomic policies, and I will make sure that this continues to be the case. Programs can be hard, can be difficult, can require efforts and sacrifices, but it is only fair that the focus not be on the less-privileged and the poorest in those societies that need to make an effort to reorganize their economic life and can thus take their destiny into their hands.
So I am afraid my response, Madam Chairman, is not particularly controversial, because I generally agree with your points, and as I said, I pledge to continue the policy of being transparent with you, of continuing the dialogue, of integrating the social dimension and the necessity to include.
If there is one thing that we are learning at the moment, particularly from what is happening in the Middle East and North Africa at the moment, which is transformational, which is bearing so many potential fruits, it is that it has to be inclusive. For development to be shared, to be sustained, it has to be inclusive, and it has to benefit the young population as well.
So, voila. That is really what I wanted to answer.
MS. SRINATH: Thank you.
I guess the people who were too small to count finally showed us that they were as important as the institutions that were too big to fail.
MR. ZOELLICK: Well, and I apologize--I want to go on a little bit more, because the Bank operates a little differently than the IMF. We are on the ground in a lot of countries, so we have been able to engage on a number of these issues, so I just want to give you a little bit of a report on that.
It starts out with your basic point in that of course you can engage with us, and in fact you will help us do our job better, and for the reasons I have explained, this is something that isn't just a word, but I think we have tried to start to institutionalize this.
At the same time, I want to again speak openly with you about the fact that both of our institutions have 187 governments as shareholders. You may not like those governments--you may not like your government--but we have to work with that as a framework, and I think we can work with that as a framework, and we can change the overall context, and who knows, we might even be able to work with you to help you in your contact with your governments.
But having said that, you have to recognize that we face constraints on how we do that, and we need to do it shrewdly as we move forward.
I gave a speech not long ago where I talked about the fact that when the World Bank was formed, it was formed during the course of World War II to deal with governments for reconstruction first and then development. We then created over time an institution to deal with the private profit-making sector, IFC. And I started to plan the idea of, well, shouldn't we also be able to deal with the private non-profit-making sector and the notion of civil society groups.
Now, you won't be shocked--this was not met with universal acclamation by the Board. So we are working our way through these issues, but it is a process by which I think if we can show the commonality of interests and how you make the product better and make things better for people in their countries, I think we can make progress.
For example, we work with a lot of CSOs on service provision out in the field. The health program that is delivered in Afghanistan is delivered by civil society groups, both international and domestic, and this is increasingly the case in many countries, because it is a way of building on local knowledge, local capacity, and then supporting it from the government side.
Input and feedback--everybody who is familiar with any type of human development program or service program, whether a city or a state or a national level, knows that governments may be well-intended, maybe there are some people in charge who don't do as well. The more transparent, the more you can build feedback into the system, people do a better job, so we try to develop that.
The whole anti-corruption effort--probably the best anti-corruption example of all the things we create is the simple fact of having a schoolhouse where, in one case, you put on the door of the schoolhouse what are the services--you are supposed to have two teachers and 100 textbooks--and that allows the community to see what you actually have delivered. So that helps us in the process moving forward.
Now, what we have tried to do is to build this in, so for example, we engage now with our country offices at the country level and also on global policy issues with civil society groups. So, if you are in a country, in a developing country or a developed country--I'll come back to that--and you are having difficulty, well, then, you need to come back to us, or frankly, connect us with our website, because we are trying to multiply the degree of opportunities to interact, whether it be education, whether it be energy, or the country assistance programs.
You mentioned, actually, in your opening remarks both issues of climate change and agriculture. When we created these Climate Investment Funds, for the first time, we suggested that there be civil society members on those boards, and there are civil society members on the board that was created for the Global Agricultural Food Security Program which came out of the L'Aquila Summit.
So this is the type of concept that I think we can advance, and it helps make exactly the point you mentioned about having this be a regular course of process.
The Japan Social Development Fund did a study of the way we have already been working with civil society groups, and it identified that we provide some $60 million in grants directly to civil society groups through 26 different funding mechanisms.
Now, I am sensitive--and this is where we want to work with civil society groups--even as we try to provide funding and support, there are always the issues of control and influence, so we want to again work with the civil society community at a time when I know many are having a hard time getting the charitable contributions or other support. How can we try to expand this?
Now, coming back to the speech I gave, the idea that I launched there was that we should actually start to create a civil society support facility, like you have the World Bank and like you have IFC, to grow over time. The way that we thought we could best move this forward is to try to co-fund something with the World Bank. We have talked with foundations and donors, and we will of course be seeking civil society participation in defining its objectives, its governance structure, its projects. And we plan to begin that, actually, in the aftermath of the Annual Meetings. So that is something where all of you can engage with us to try to give your best views on how to try to accomplish it.
Now let me put this in the bigger context. I gave a speech talking about "democratizing development." Well, those aren't just words. This is the idea that one of the most basic things we have learned about development is if the local community doesn't own it, it doesn't work. You can have smart people, you can put in a lot of money, you can have good intentions--if you don't have local ownership, it just doesn't work. So, we work with governments, we work with the private sector, and obviously, we want to work with the nonprofit public sector.
Now, how do we encourage that? Well, in our own policies--but we are also working on this with government policies--we are pushing openness, transparency, accountability, including social accountability.
I launched an Open Data Initiative, so for the first time, the Bank now has 7,000 datasets accessible, easily accessible--in fact, we have come up with all different software applications; they are in over 36 different languages, because our country offices have done this--so "democratizing development" means it is not just our researchers, but it means anybody can take a look at this.
One of the things we have just launched is our own Internal Evaluation Group has done its project for evaluation, so you can see what they think we have done wrong over time. And to be honest, again, this is how we learn. Nobody does anything perfect--you don't, we don't--and we all learn from our mistakes. So the more open and transparent you are, the earlier you get the feedback on these issues.
Here is one that I think is going to be a game-changer. We have moved to geo-mapping first all of our IDA projects for the 79 poorest and now for all of our IBRD projects. This means do you want to know what we are doing--get on the website, put up the country, point, and you can get the individual project and information on the project. And what we would like to be able to develop--we did this with Google, but this is right around the corner--I would like to be able to have the ability to interact with people in the community, so somebody can get on a phone and say, oh, this is what you think is happening, but let's punch in the data about what we think is happening. This will make us better, too.
So when I talk about "democratizing development," these aren't just words, these aren't just consultations. We are using communications, we are using networks, to really try to develop this and, frankly, publish what you fund--rank the World Bank number one of all international and bilateral agencies in terms of transparency. Now, we are proud of that, but we know we can't rest on it; we need to keep going. We are the first and, I think, from now, the only international institution that put in a Freedom of Information Act that is based on a negative list. And the nice thing--because this goes to the example of how we made this happen--we looked at the U.S., and we also looked at India that put in a Freedom of Information Act.
What a negative list means, as you may know--most institutions have a positive list, so they say what documents they will make public--the negative list means that everything is open unless it falls into an exception. And we created a special international panel of experts that, if we say it falls within an exception, and you think it doesn't, it goes to that as a judicial panel just as an international FOIA request will.
So we are trying in multiple ways to kind of be able to drive this "democratizing development" forward.
You mentioned about safeguards, and I agree with you--I think the World Bank safeguards have been, by and large a plus in terms of the international development agencies, and as you are probably aware, some developing countries are actually worried compared to others in the system that if you work with us, it adds a cost, and so on and so forth. So we are always trying to find that point where we don't want to add costs for developing countries, we don't want to make it harder, but we want to make the safeguards work.
So what we are going to do for the safeguards process is make the whole development transparent, inclusive, and broad-based both at the approach to updating them--so even before we update them--and then, of course, when we draft the policy, we will make that available. And right now, we are consolidating the guidance for staff based on best practices on how to do this; we will make this public, and we will of course seek discussion sessions with CSOs. We may not agree on each point, or we may reach different results, but we will certainly try to make sure that we can reach out and engage people on the full set of issues--and I am the first to acknowledge the more people you talk to, you'll get an insight or a perspective, and maybe you can come up with something different.
Now, you touched on fossil fuels, but you also said that under some circumstances, this could be possible. I appreciate you saying that, because let me tell you the most difficulty I run into on the fossil fuel development. It is from developing countries--and I'll tell you why. Thirty percent of the people in Sub-Saharan Africa have electricity. Obi Ezekwesili, our Vice President for Africa, will tell you what it's like when we go to African countries and people don't have electricity. And you talked about gender--it is kind of hard for women to be able to get very far in life if they still have to go to a stream and bring water up in buckets. What I saw in Vietnam was that water pumps were the best liberation for women of anything that that country had had, and it came from rural electricity.
So there are ways to try to do this. And we understand there are ways that you can come up with alternative energy sources--energy efficiency--that's a win-win, saves money, is more efficient. We have a whole off-grid lighting system developed in Sub-Saharan Africa so kids can read, so they can go to school, with off-grid alternatives. But at the same time, there are some groups that don't believe anybody should build dams. This goes back to the safeguard policy. It is going to be very hard, I'll just tell you, to provide electricity for people in Sub-Saharan Africa if we can't figure out a way to have some hydropower.
So these are the types of dialogues that we are pleased to have with you, but at the end of the day, developing people need electricity--it is not enough to say, I'm sorry, the United States generates almost 50 percent of its electricity from coal, but in Kosovo, where it is the only choice available, and you can shut down one plant and perhaps have another one, that they can't do it.
This is where I am afraid that for civil society groups from the developed world in particular, one is going to have to be careful that it is not seen as a new form of weight on developing countries, because I think we can find ways that you can achieve multiple goals, and that is what we are trying to do, but on the other hand, we do have to listen to some of the full panoply of voices from developing countries.
You mentioned growth and inequity, and on this one, I'll just make the point that I think the good news is that everybody is getting the message. So, when I started at the Bank four-and-a-half years ago, I talked about inclusive and sustainable growth. Now, it is the case that China has probably done more in humankind to reduce poverty with its growth, but I was just in China a few weeks ago, and they recognized the cost, not only environmentally but in terms of inequities in rural areas and in poverty. So we are now working with them on how to overcome that, but I think there is also a lesson, then, about how to get that right from the start.
You also talked about inequity being gender-based. I hope all of you have a chance to look at the World Development Report that we issued this week, which is path-breaking. And do you want to talk about the greatest inequity? There are 4 million missing girls and women that, compared to their cohorts in the developed world, or compared to men, about 40 percent are never born--and we point out the countries where that happens--about a third die in child age, and the rest die in early childhood.
Now, there are things you can do and policies to deal with this. Clean water, sanitation--there is a whole bunch of aspects of this where the right policies can make a difference, and more over, this is where part of our effort is to find win-win solutions.
Christine and I are dealing with a number of governments that are worried about global growth. I talked to a Bloomberg reporter yesterday about the Gender Report, and she said: This is the next emerging market. This is a huge growth opportunity. You have huge productivity possibilities.
Most of the farmers in Sub-Saharan Africa are women, yet they don't own property. So we did something very simple in Ethiopia. On the property titles, we created lines for two names. And all of a sudden, the women get registered, too, and then they get access to credit, and they have a whole bunch of other opportunities--access to fertilizers, access to a whole series of inputs.
So I think that, actually, we may be a little farther along on some of these topics than some of your comments suggest, but that doesn't mean that we certainly can't learn. The reason we got this far is because people, like those in this room and others, said, Look, you have got to take a fresh look at this, you have got to take a different dimension.
So the reason--and I apologize for going into detail, but I wanted to say in addition to saying, yes, we will listen, that we are doing these things, and there are ways we can do them better, but I think the best way--and I can show you our commitment--is by practical, real things that are happening on the ground.
MS. SRINATH: Thank you.
I know that we have only 20 minutes before Ms. Lagarde has to leave, so I'm going to ask you to keep your questions, interventions, comments, as brief as possible, and for those of you who particularly want a response from Christine Lagarde, if you could go first.
Let's start here.
QUESTION: Thank you.
Thank you, Madame Lagarde. You really are a fresh face to the IMF.
As the Independent Evaluation Office several years ago noted, one of the things that they suggested here at the IMF is the encouragement of moving the organizational culture forward and expanding the recruitment process to include more women, to include more minorities. I am wondering--as you noted when you first came to the Fund, that indeed one of the objectives you had was to encourage more female participation particularly on the Management side--I wonder if you wouldn't mind reflecting on perhaps what can be done to extend this to area departments where, really, the negotiations are happening with fellow country officials. How do we get more women behind the table, who I do believe indeed bring a different perspective, if you will? And also, if you don't mind, just commenting on perhaps the organizational culture that you have seen here at the Fund and either things that you have appreciated or things that could be reformed and changed.
MS. SRINATH: Thank you.
We'll take a few questions.
The lady in the third row, there, yes.
MR. ZOELLICK: Could you ask people to give their names and where they are from?
MS. SRINATH: Would you tell us who you are and where you are from?
QUESTION: Yes. I am Sarah Anderson [ph.] with the Institute for Policy Studies here in Washington, D.C.
Earlier this afternoon, we had a good panel on financial transactions taxes and some of the useful research that the IMF has done on implementing them, and my question is what role you think the IMF will be playing on this issue in the future. For example, will it be working to apply some of this research to advise governments on how to design financial transactions taxes and encourage more governments to take a look at this issue so we can have the strongest international cooperation possible?
MS. SRINATH: Thank you.
Since we have talked so much about young people and MENA, would you go next?
QUESTION: Mohamed Abul Shakrah [ph.] from Egypt, Youth Entrepreneurship and Sustainability.
My question is for Madame Lagarde. We know that the IMF mandate is macroeconomics, so the question is when will IMF consider youth, numbers-wise, I mean, demographics-wise as a macroeconomic issue, especially in its Article 4 procedures with the respective countries.
Thank you so much.
MR. SRINATH: One more question, here.
QUESTION: Per Kurowsky [ph.] from New Rules for Global Finance.
This is a question that goes both ways, really. If bank regulators had defined a purpose for banks before regulating this, we might have had a very different bank crisis, but not as large, systemic, and dangerous as this one.
IMF, World Bank, when are you, as our global development agents, going to require from the regulators in the Basel Committee to openly and explicitly define the purpose of our banks to see if we all agree?
MS. SRINATH: Thank you.
MS. LAGARDE: Thank you very much.
Turning to the first question about the recruitment and the fact that we need to expand, and we need to broaden the base, I must tell you that I was in a way very pleasantly surprised by the number of women at the IMF, by the number of very competent women, including in high positions in the Management. And I was also very pleased to see that the organization had commitment in terms of percentages of women in the various layers of the organization; and I will really make sure that we actually stick to those commitments. This is not always an easy thing to do, but I think it is important, and it is important to lead by example and to make sure that it happens. So I will do my best to that end.
You mentioned the issue of the negotiating teams, and you are absolutely right. I was told--I haven't experienced it yet--but I was told that in some countries, in some program negotiations, and sometimes in some missions under the Article 4 Review, some governments have actually asked that there be fewer women on the team, and sometimes no women on the team. And if that were to happen, I can tell you that I will pick up the phone, and I will confront those who are asking that there be no women, or that there be fewer women, on the team, because I think that having the two, having the diversity expressed in the mission teams, whether it is under program design or whether it is under regular bilateral review, is very important. So I will not suffer fools in that particular field.
On the general impression that I had, as I said, many more women than I thought--not at the Board level--there are many men at the Board, and thank goodness there is a woman, who is Meglyn Sekker [ph.], who is the U.S. representative. So, between the two of us, we have a degree of complicity.
But I was surprised by the number, the talent, the respect that they have in the organization, and I will really make sure that that lasts and improves over time.
On the--I think the next one was the very competent question on the financial transaction tax. You are right, it is an area where the Fund has done an extensive amount of work, and the conclusion of the work that has been done under my predecessor leadership concluded essentially to two major findings. One is that the FTT as such on a per-transaction was not necessarily the best avenue if we wanted to have a win-win solution. And the recommendation of the findings and the report and the work that was undertaken by the team was that we would be better off, and those countries that want to implement that kind of taxation would be better off, having financial activity taxation or financial sector taxation, so there could be a good proportion between the amount that is actually withheld in terms of revenue and the determination of the use of the taxation--in other words, used as a resolution fund, for instance, or used as a tool to prevent excessive risks.
But once you go into the financial transaction taxation on the per-transaction basis--a bit of the old Tobin tax--you probably induce a slowing down in the system, which is probably a good thing--I think the high-frequency trading that we see at the moment is not necessarily the most comfortable and safest way of trading that there is around--but equally, you are probably incapable of encompassing the entire system, and you are likely to produce sub-segments, shadow systems, that you will not be able to capture, whereas if you actually focus on the sector or the activity, then you are certainly more able to grab what you are trying to grab.
On the macroeconomic analysis and how we should segment population, population is clearly a very, very strong component in any analysis that we conduct, and again, if there is one thing that we are learning at the moment from what happens in your country, from what happens in Tunisia, from what happens in Libya, from what happens more generally in those countries that have decided to take their destiny in their hands, is that the young population is a driving force, not only because it is going to pay the pension of the old guys that will be going but because they are producers of wealth and the creators of growth. That doesn't mean to say that it is all rosy, because I think that on the education front, on the appropriate link between the education and the jobs that there will be under the strategic development plans of those countries, there is a lot to be done.
When I look at our Tunisian friends, for instance, and how many of those are going to be unemployed graduated from very good universities, it makes me sad, because it shows that we are missing a link between the level of education and the adjustment into the professional life for them.
On the purpose of banks, it is a very good debate to have, and it is one that I think the Vickers Commission Report is actually helping to build--what are banks for, and what are the state guarantees or general deposit guarantees intended for? Is it to actually guarantee the savers and the depositors, or is it something that is intended to fuel and benefit other activities that are really within a completely different realm of activities?
My sense is that the most critical mission for the banks--and that is what we are trying to say when say that banks have to rebuild their capital buffers--is to actually finance the economy, first and foremost, and that should be really the critical mission.
MS. SRINATH: Mr. Zoellick, would you like to speak to any of those questions, or should we take a fresh round of questions?
MR. ZOELLICK: I'll do whatever you want. What is your preference?
MS. SRINATH: Let's take a fresh round of questions.
The lady who has been waiting really patiently behind that mike, please, and then the gentleman behind that mike.
QUESTION: My name is Yeta Zara [ph.]. I am the Kosovo Director of Balkan Investigative Reporting Network, and I have a question for you, Mr. Zoellick.
You made a very sincere confession in your statement just now when you said that some developing countries actually have to have energy produced from fossil fuel. Now, the civil society from South Africa here has told us, the Kosovar civil society, that that is why ESKOM was built, under that excuse, that it would bring electricity to the poor. What actually happened was that the electricity became too expensive to go to the poor because of a new coal power plant.
Why are you still determined to build a new coal-powered plant in Kosovo--the European ESKOM, maybe. Are you ready to bear the cross of a European ESKOM in Kosovo without actually doing two very important things--a study of alternative energy resources and a study of the loss of so much energy anyway at the moment in Kosovo, without analyzing energy accountability and efficiency? Can you tell us why you still want to go ahead with a coal project without doing these two studies?
MR. SRINATH: Thank you.
The gentleman there.
QUESTION: My name is Mohamed Lutfi [ph.]. I am the representative of the Lebanese Civil Society and Disability Movement.
My question is addressed to Mr. Zoellick.
First, I would like to thank you on behalf of the Lebanese Civil Society and Disability Movement for opening up to the concept of social accountability, and please allow me to hold you accountable first by asking about the safeguard policy papers of the World Bank.
Given the fact that the World Bank has been the leading international development agency on lots of social issues in the last decade, especially about disability when the Bank had the Disability and Development Unit, and then the unit was diminished, given these facts, we want to know, please, what is the upcoming policy on disability and why is it not included in safeguard policy papers as we experienced before? We understand that safeguard policy papers are the policies that reflect the World Bank's intention for preventing any harm for human rights and exclusion for social groups and vulnerable groups particularly, but we see at the same time that disability issues are excluded. So, isn't that a kind of contradiction in what the World Bank is saying? And until when will we keep hearing that issues of disability are just like, okay, we talk about disability just in our rhetoric and words, we pass by on it, but we don't reflect it in our policies--in your policies as the World Bank.
Thank you very much.
MS. SRINATH: Thank you, thank you.
The lady here in the first row.
QUESTION: Thank you, Ingrid.
Ms. Yemesi Ransomkuti [ph.]. I represent the Nigerian Network of NGOs at this forum. I am also a consultant to the World Bank on the Second Urban Sector Water Project in Lagos.
Welcome, Madame Lagarde. We are most enthused. More power to the women.
I am very excited and we are very excited about the initiatives in ICT, the mapping and the data and the transparency and disclosure that that is going to promote. I'm not sure whether I heard that this is going to be extended to mobile telephony, because that is where we are going to be able to engage the majority of our people in the Third World.
I know that the United Nations Millennium Campaign is spearheading a program on mobile telephony tracking, and they are experiencing challenges in funding. So I would like the two organizations to look at this and see how it can be supported.
Finally, on jobless growth, it is something that we really have to focus on. We are a little tired of hearing in Africa that the percentage of GDP, we are doing very well--yet there are no jobs. And your indicators I believe have to be reformed in such a way that when you publish your growth figures, it takes in jobs.
MS. SRINATH: Thank you.
I know that you have to leave in five minutes, so I'm going to let you go first, Christine--well, maybe the last one.
MS. LAGARDE: Well, I take it as a recommendation, and we'll look into it, but it is obvious that, as well as being inclusive, the growth that needs to be created is growth with jobs. How we can in terms of measurements, in terms of statistics, actually determine the volume of jobs created as a factor of the percentage of growth is something that I will look into. But I'm sure that--you know, statisticians can produce no miracles--and I don't like statistical miracles; I don't trust them--but if we can have data that actually supports the identification of jobs relative to the percentage of growth that is developed, we will look into it.
There was really good work that was conducted under the leadership of Professor Stiglitz and a few other Nobel Prizes about how we measure growth and what is the real value of GDP relative to lots of other factors that were not included and not accounted for in the traditional way of calculating growth. I think that that work and the conclusions of their report should actually be picked up and should channel through the way in which we actually report growth--not that we are going to do way with the standard, traditional GDP calculations, but growth accounted for with different parameters that are not taken into account is also something that we should be attentive to.
I will look into what you just suggested. I don't know that it exists today, but I will look into it.
MS. SRINATH: Thank you.
MR. ZOELLICK: What I would suggest, since I have a little while longer, and I know that Christine has to leave in a few minutes, is if there is anything else that she wanted to say.
MS. SRINATH: Any concluding remarks?
MS. LAGARDE: No, I don't want to conclude just for the sake of taking the floor.
I just want to again repeat what I said earlier on. I welcome this dialogue, I commit to it, and I think that we just have to continue to do a good job at being in constant contact through your representatives and through occasions like this one. It is only very temporary, and I think that on the day-to-day and the missions and the review and the Article 4, with our people on the ground, that we need to engage. And I took note of what one of you said about the setting up of an advisory--I think it was you who mentioned the advisory council including civil society representatives--I think that is something that we need to go away with, think about, and see whether we can include that as well.
So, without further taking the floor, thank you very much, and again, you are home here.
MS. SRINATH: It's all yours.
MR. ZOELLICK: All right.
First, I will address a few of the questions that were in the first round, too; I just didn't want to interrupt before.
Your point about the Bank regulators is a particularly intriguing one, and let me share with you a little anecdote.
Bank regulators come out of the world of central banks, and central banks will be the last bastion to fall in openness and transparency. When Pascal Lamy, who is head of the WTO, who has dealt with civil society groups for many years, as I did, starting in the trade area--and I met with Mario Draghi at that time, head of the Financial Stability Board--we shared with him a story that some union groups had come to Basel and tried to get in the door and talk to people, and they were met with screams of uncertainty. And we have suggested--and I'll just pass this along--that they also have to build some outreach mechanism through the Financial Stability Board and openness and transparency. And I will just share this from my own learned experience. Some institutions--central banks in particular because of the sensitive market information--build in cultures of this, and it is understandable, but then, on the policy level, as you suggest, people need to get used to being more open about it. And I just think that that is something, again, that we can try to work with you with as a general principle. I think the world will move more in this direction, but it will take some time on it.
And I agree with Christine's response to you about the fact that the good news is, as the discussion in Britain showed, that people are starting to debate the exact purpose of banks.
On the disability question, I share your strong sense of sentiment on this. I was actually part of the creation of the Americans for Disabilities Act under President Bush, George Herbert Walker Bush. So this is something that I have tried to push in our programs and policies. And I will ask if you give your contact information, I will be pleased to try to give you a sense of response of different groups that we have tried to help. I remember in Vietnam actually visiting a group of disabled people who were building wheelchairs for other disabled people, and it was a group that we were trying to support.
You asked about it particularly from the safeguard dimension, and I don't know the answer. It could very well be that our safeguards have tended to have a more limited focus on some of the environmental topics and some of the larger community topics, but that's why we put these out for openness and discussion, so we'll make sure that you can connect with it and make the case, and again, from the larger policy point of view, I know that--it depends on how you define it--but the percentages of publics that are disabled are actually quite huge, so it fits into the same idea of how do you not only treat people fairly and properly, but how do you empower them as part of an overall society and economy.
From Nigeria, you asked about jobless growth, but you also asked about youth and jobs. This is one where it is very good that we get the exchange moving deeply, because all I can share with you is that it is one of the hot topics now, whether in developed or developing countries, not only because of unemployment, but obviously, those of you from the Middle East and North Africa know that you had a youth bulge, and this is one of the events that has helped trigger the events that we saw this year.
We are going to launch the next World Development Report on jobs, so this is the complement to the Gender one or the Post-Conflict Strategy, and I hope we can connect you into some of the outreach as we create it.
Let me tell you what we are trying to do. The last time the World Bank did a World Development Report on jobs, it was really sort of labor economic issues, and I think it was either 14 or 16 years ago, and it was looking at globalization and jobs. And the best from what I can see, it tended to look at this as a traditional labor market question.
We have just started the preliminary work, because it is a year long, and we'll be doing the outreach on it, but what our team is looking at now is a very different perspective, and the feedback we are getting on it is quite intriguing. It is looking at jobs in terms of personal fulfillment, jobs in terms of productivity to have higher compensation, jobs in terms of social cohesion. And I think that this lens is going to be very revealing, because sometimes the perspective you bring may shift the policy approach, so it is not just seen as jobs as a derivative of economic growth and kind of what the labor market flexibilities are, but maybe if there are, in economics terms, a series of externalities of this nature, it may make sense to structure the policies so that you can invest in these.
You see this debate in developed as well as developing countries. So from Nigeria, too--sorry, I couldn't see where you were--but I think this is an issue that your comments are extremely timely, and I can give you encouragement that there is, not surprisingly, whether people are elected or not elected, this is an issue that goes to the core of their countries, so it is one that we are trying to advance through our work.
I'll say one other element--and this gives you maybe some sense of hope that people will listen and change perspectives. We came into this also in the issue of post-conflict states or fragile states, and one of the reasons our prior World Development Report focused on this is that you tended to see that the security community, the governance community, and the development community would go on separate paths, and jobs is a good example. You would talk to people on the security and government sides, and they would say, For God's sake, try to create jobs fast--otherwise, you have a lot of young people around, you can have violence, some of them in bad situations may take money to plant bombs somewhere.
Now, you talked to economists, and they would say we don't want "make work" jobs; they are not sustainable, and so on and so forth.
So what this report has suggested is that we have actually learned now from experience about how you can try to create jobs faster. They may have training components. It may be a food-for-work job. It depends on the wage rate, so you are not interfering with the private sector investment. But there are ways that you can try to do both, and it is a good example of people trying to look at some of the jobs issues from a slightly different perspective.
Now, on Kosovo, here is the situation that Kosovo has brought to us--and we haven't had a final decision; in fact, it has to go through an expert panel that we created exactly for projects like this to ask exactly the questions that you have asked about alternatives. But the proposal is to shut down a 40-year-old power plant that is the single worst power source in Southeastern Europe. In its place, it would clean up another aging power plant and build a more efficient one.
Now, like you, we have asked a lot of questions about what alternative energy sources there could be, because that would be our preference under most environments--and even if it is going to be fossil fuel, whether we could use natural gas or other types of methods.
So one of the things we developed particularly for coal is to create an independent panel of experts to review the proposal and to come back and ask how does it conform with some screening criteria, and the screening criteria raise exactly the types of things that you have mentioned. So you will be able to see that; that will run its process. And again, the very sensitive issue here is the one that you mentioned, but I'll take this back in the South African context. One thing to be a little careful about in ESKOM is when you talk about the effect on the poor, how do you affect the fact that if South Africa doesn't have electricity that people won't have jobs? What is its effect on various industries that are dependent on that electricity?
Now, in the case of ESKOM, we actually worked with South Africa to develop energy efficiency programs, a special electricity funding program for the poor--and I may be out-of-date, but we can check--that I believe actually provided low- or no-cost energy to the poor up to a certain level. And Obi here can correct me on that.
And then, of course, we also looked at alternative energy development which South Africa is doing.
So, look, I don't mean to suggest that these are slam-dunks in any way, but one of the things that some countries want the Bank involved is, you know, ESKOM had its own issues not only in terms of efficiency and procurement and other types of aspects, and frankly, the hard choice that we face, so you understand, is do we get involved, or do we say no, and then have the situation proceed without us--and sometimes we do that. But if we feel that we can run through a process, do this analysis, bring in an expert independent panel, make it transparent, make sure they develop alternatives, make sure they give low energy to poor people, well, then, maybe that is something we should do.
And again, I realize this is an open discussion topic, but South Africa is a democracy. Now, you may disagree, and if you disagree, you participate in that democracy. Now, I'm not going to stop there because--I had a conversation with somebody from Tunisia--one of the points that we are trying to do--and this is why our engagement with civil society is quite important--I mentioned--I don't know where she went--okay--you put on a coat; that's why I didn't see you--obviously, they are going to have elections in October, and when I was in Tunisia, I was struck by the participation of women in the events in Tunisia in the spring, and I was a little worried that as you create political parties and other things, women might not have the same influence. So we are taking this World Development Report, and we are having a gender event, which I mentioned earlier, in October. And today I met with the Tunisian Minister and said, Will you help sponsor the event, so we help bring it forward.
Now, it's a small thing, but my point is that in what is going to be an emerging democracy, it is a way that we as a development institution can talk about gender-related development in a way that perhaps become a little bit of a catalyst for groups to participate in the weeks before the election.
Now, I'll be frank. We have to be careful. People don't want us--if we started to interfere in your elections, you wouldn't like that either. But if we can use development as a way to broaden participation in society and broaden participation in these actions and bring these facts to the fore, I think that is constructive for both development and for governance.
Just briefly, because you raised the female participation issue at the IMF, I just want to give you a sense, because--again, I'll share with you the challenge with this. I am extremely pleased now that across the World Bank Group--so that is IFC, our private sector arm, IBRD, IDA, MIGA--51 percent of the officers--so that is vice presidents, managing directors, others, senior vice president--about 50 people are women.
Now, that's the good news. Let me tell you the bad news. The bad news is if you go down to the next levels, it is only 35 percent.
Now, here is the story on that. When I came to the Bank, like many institutions, we had various goals set for percentages--and I forget for women whether it was 35 or 40 percent--but I said that's ridiculous--we should make it 50 percent.
Now, of course, people don't like that at first, because they are not going to be able to hit 50 percent, but I make all those appointments that I mentioned--the vice presidential and other ones--I work with my staff, but those are ones that I decide and send to the Board. And I am trying to send a message, which is that if I can get 50 percent at that level, then I review the next level down, and I review for two things--well, three things--competence and how it has gone through a process, female diversity, and developing country diversity.
But the reason I mention this is that what I have even discovered is that it may seem simple, but you have hiring panels, you have sector boards that do reviews of expertise, and the thing you always have to be careful about is whether, not explicitly but implicitly, people build in biases--they start to replicate the DNA, they look for the past background. And this is particularly hard if you are trying to advance a group more quickly because they may not have had as many years to get up. So you can build--you are trying to build the pipeline.
But all I can just mention to you is that you just have to keep pushing and be resolute on this and mention it again and again and again and show the influence of it. And you have to be careful--you don't want to be setting quotas, because then you get a counter-reaction. But it is my firm belief that this is an important part of executive responsibility--and again, hold us accountable. I am not happy with that 35 percent, but it is something that I hope in my time at the Bank, we can push to change, and also for developing country people.
One other point that I just wanted to mention to you that I forgot before, but it relates a little bit to this broader point about democratizing development and engagement of CSOs.
One of the things that we have put in place in the last year is the idea that--as many of you know, we do investment loans, but we do some loans directly to budgets, and these are often attractive, say, in the financial crisis because it moves money in more quickly, it is faster-disbursing. But based on the types of discussions that we have here today, one of the things I said to my staff is, look, do we ever give budget support to countries that don't publish their budgets--and how can I defend that?
So we have now instituted a rule that says if you are going to give budget support, that country has to publish its budget. Now, that gets into questions of how they publish it and so on and so forth, and this shows you a little bit again why none of these problems are always so simple. People said, well, what about in Liberia--they needed budget support fast, but they really didn't have the budget. So we made an exception for post-conflict states and said you have to publish it within 12 months, so you'll have time to do it.
But I just mention this because this is also not only an example of what we are trying to do, but you can bring us these ideas, too, these ideas that come from some of these meetings--maybe out of the disability comment you made, we will draw something else.
So we are committed, and we are committed, frankly, not just to satisfy different audiences, but we think it will lead to better performance. It leads to democratized development, it leads to ownership, it leads to broader inclusive participation. And I don't expect everybody to agree--this is not going to be nirvana--but nevertheless I personally believe that a participatory process and debate and openness lead to better results.
MS. SRINATH: Thank you.
Are you going to have to leave now?
MR. ZOELLICK: I have another five or ten minutes if you want to do it.
MS. SRINATH: So we'll take a couple more questions?
QUESTION [Off microphone]: I first want to thank Mr. Zoellick for his [inaudible], and social accountability to the point of stopping loans to governments who don't want to abide by those measures. And for transparency, I have one question here.
The Access to Information Policy at the Bank was approved lately, and it is working quite well for investment projects, but it is not working for development policy loans, and the reason for that is the safeguards. Because of the safeguards, we have many documents that are produced during the preparation that are disclosed to us citizens to know about what is going on, but with the DPLs, because we don't have those types of documents, we don't have safeguards, we actually know about the DPL when it is approved. And I am afraid that with the Program for Results, this is going to be the case if there are no safeguards, so there will be no documents produced during the preparation for us, and we will also know about it when it is approved by the Board.
MS. SRINATH: Thank you.
Let's go to the gentleman right behind you.
QUESTION: Good evening.
My name is Wifar Romacev [ph.] from the Baron [ph.] Institute for Economic Development.
First, I would like to thank the President and the World Bank for their vision and all the reforms they are making, and most especially for the idea of the view of the potential civil society new financing facility. I think this is an opportune time given the financial crisis that is going on in the world now, especially in the First World.
I would like to ask if you have any time frame when this potential financial facility will come out, and are there going to be consultations with civil society organizations?
I would also like to thank you guys for [unclear] a lot of civil society organizations with this idea.
MS. SRINATH: Thank you.
QUESTION: Hello. I am Summer from Tunisia.
I want to salute the initiative of the Open Data and the transparency that you are trying to make, but I am also wondering and worried about the fact that these data and reports are still not understandable. They are really good, and it is a great initiative, but I am not sure it is very useful, because I am sure that there are so many people in my country, young people, who would love to read the World Development Report on Jobs--I'm just not sure that they will understand it.
So, talking about this communication issue, I know that people don't know your institution because they simply don't understand it, so I am glad that you are learning from the Arab Spring that it took us a whole institution to make such institutions learn from their mistakes, but I am wondering what are we or can we learn from you.
MS. SRINATH: Thank you.
Maybe one last question, here.
QUESTION: Yes, I am Kamran [ph.] from Pakistan.
Just a brief comment. What we have seen--and I represent the microfinance institutions, MFIs, in Pakistan--what we have seen is that the engagement of the local office of the World Bank in Pakistan is again not directly with the civil society, and like for microfinance institutions, that has been a major gap, and we would like to request and also hear your views on this particular element, because the microfinance sector is going through sort of a turmoil, and engagement with the World Bank local offices could really be fruitful for the sector as well as for the Bank's understanding of what the real issues are.
MR. ZOELLICK: Okay.
Let me start with the last one. If our office isn't accessible, it should be. Give us your name. We'll follow up.
It may be--I don't know about the microfinance programs in Pakistan. Some of these are funded by--some of them are government-based, some of them are private sector-based, and it may be from our IFC side, which is the private sector, so we'll connect you with that.
But just one other point to add to this so you have a sense of kind of the multi-dimension of this--we at the World Bank have actually had a parliamentary network that we have supported for some ten years, and the IMF has just joined it this year. This is another device that we can use--we talked about democratic systems--trying to engage parliamentary members so they ask about these questions or loans or microfinance, and they have a chance to engage in the process. So I just wanted to include that.
On the comment about data and understandability, two thoughts, or maybe three. One, interestingly, when I met with the Tunisian delegation this afternoon, I was worried about a different dimension of this. As you know, it is a transition team, and they are trying to do a lot of what I hope are good things. They have an access to information policy that has been partially implemented, not fully, and other steps trying to move toward some of the Regions that have not had as much benefit. I am afraid they have a communication issue, so we have actually talked to them about what we need to do and whether we can help them in terms of broadening the communication with the government.
So, again, to me, you see, this is the best way it works, that if we can get them to say, look, we have to talk to our public; how can we help do that, how can we create the engagement? Maybe you can help us with that.
What I was talking about with the Open Data Initiative is datasets--and again, I am pleased to get any insights you have. Let me give you one example of what we did that to me shows the appeal of this. We created an Apps for Development competition. So we created a competition, and we said: Come from wherever you are in the world. There are only two requirements--use our data, and relate it to the Millennium Development Goals.
So, for us, this was fantastic. It opened us to a whole software development network that we would never encounter before. And you could see how it kind of moved--it was in East Africa but not West Africa--and what these people came up with in terms of games, matching the data, different graphic expositions was tremendous. It helped us. We could have had 100 smart people in a room for a year, and they would never come up with some of these things.
But I think--and again, we can follow up with you--that at least at the data level, we are getting pretty good feedback about how to make this accessible. But the way your question was asked, I think it was also asking about the general information about the policies and projects, so we'll try to connect with you, because as you can tell, I really want to do this in Tunisia, and maybe you have some insights on how we can do it better.
As for the question on the CSO facility, we hope to begin the consultations right after the Annual Meetings. And my only, sort of--well, I don't know, it's between a request and a caution--is this is not--I am on a little bit of thin ice here--in other words, I am trying to push something that, as you can imagine, some people think is very good, some people, well, are not so sure. So you can tell the way I described it, we are trying to start in a way where we might put in some money, get some money from donors and others, and again, we want to build in civil society participants. So if it is not all that you would like it to be at the start, be patient and realize that I am trying to work with different forces here, but to me, it's like some other things we have done--this is a seed that I think has great potential, and it goes right back to the fact that the more we can show how interactions with civil society help us perform better, deal with corruption, and improve service, then we get the positive feedback loop. So, sometimes you have to start and build these things a little bit.
And then, on the transparency of the Access to Information Policy, I'll ask if Caroline wants to say anything about the development policy loans. She is our most recent Managing Director and was head of External Relations. But before she does that, I will say on the Program for Results that we should interact with you because we are actually still in a consultation period about that, and one of the things--I don't want to for sure, but I am inclined--is that I want to maybe start this off with some pilots and some CAPs [ph.] exactly to test the sorts of things you are doing.
Now, just to share with you the tension that we'll have to deal with, many developing countries say, look, remember all of those conditionalities that people used to demonstrate against--well, that's also a safeguard. So the conditionalities are that we require you to consult with people, you have to take this environmental issue. So one of the things that we are trying to respond to with the Program for Results is to say to countries, look, we will work with you to develop better governance, we will work with you to develop anti-corruption policies, but at the end of the day, we will present you the money if you achieve the results. So this is where--and you can see that this is actually a way of empowering developing countries. When you were a finance minister, you probably would have liked the idea if you could say: Don't tell me how to do it. If I do it, give me the money.
Now, I understand the point on the safeguards, and we have gotten this from different perspectives. Some developed countries are worried about corruption issues, too. So it is just a little bit of an example that these things are often not black or white, and the reason we are trying to have the consultation is to know how we can make it easier for developing countries to make their own decisions and as long as they show the results, get the money, while preserving some of the protections that we have had before.
And frankly, I realize this is not the end-all and be-all, but one of the reasons why I suspect we will start this with a pilot is that when you really aren't certain about a balance, sometimes it is best to test it and get feedback--and that also means feedback from all of you.
Did you want to add anything about development policy loans?
MS. ANSTEY: Thank you very much.
I would just say that I think this is more about an issue of budget support and how we do budget support than actually access to information, because the Access to Information policy does cover--all the documentation is released when the Program Document goes to the Board, so you see what the Board sees before the Board discussion takes place.
I think what you are saying is that this is more about the issue of budget support which goes straight into the budget, which isn't linked to a project. And I know there is a debate about the whole area of budget support and safeguards. But I think that Access to Information treats budgets--DPLs and investment programs--in exactly the same way. You get the entirety of the document. The documentation obviously is a little different because it is not for a project--it is for the budget.
MR. ZOELLICK: Let me make a guess here, and we can follow up with you on this off line.
It is very possible that with investment loans, the nature of the investment loan is that the office does broader consultation as they are developing the loan, and the nature of a development policy loan, since it moves faster, does not have the same interaction. However, what a lot of those development policy loans are now doing is actually connecting with some of the reforms we are talking about. In other words, the policies we are trying to change are often openness, transparency, and heavy on the governance side. But there are some others that might deal with energy policy or something like that.
So maybe we can get more specifics about what you have in mind, but what we can maybe follow up on is when our staffs are working with governments to develop the policies, maybe we can try to figure out some way that we can have better outreach along the way.
MS. SRINATH: Thank you, and thank you for spending this much time at a time when we know your time is under great pressure.
If I could just sum this up, if I would pick up where Milwida started us off, we do live in perilous times. I don't think I have heard metaphors like "value of death" and so on too often when we are talking about economics. And it is compounded, of course, by the huge vacuum that we have in global governance at the moment. And I think there is a really critical role that both the Bank and the Fund can play in thought leadership as much as any other kind of leadership at this time with that group of people that are on your boards.
You have access, you have convening power, you are clearly on a trajectory of change. As Laila reminded us, we may not have enough time to pursue a pace of change that is glacial. We perhaps need to pick up the pace on the change if we are going to be able to respond in time.
But as Laila said, again, I think there is a huge pool of knowledge expertise, talent, access, connections in this room and in civil society more widely that perhaps you can draw on more than you currently do. One of the things we are good at, actually, is converting that political wound into political will. So that is an area, perhaps, that we can actually help you with.
MR. ZOELLICK: Let me close with this point.
I think one of your last questions, which I liked, was can the Bank change as fast. Okay, because I am an honest person--probably not. We are a big institution, but we are trying. And what I really want all of you to take away is this. I have touched the surface on it, but in lots of different ways with our staffs and others, we are trying to encourage this because we think it makes for better development, it makes for better ownership, it makes for better follow-through on the project; you catch mistakes. It is better governance for our institution as well as for the clients and the countries that we are working with.
At the same time, as you can see--and I hope you see t his as a sign of respect--I have never believed that--as a public official, you can sometimes just say, "Oh, yes, that's a nice point," and so on and so forth, and then leave--the other part of it, though, is expect debate. I expect that as you bring ideas, I hope you will listen to what we have to say or the various tensions--and I realize it is not going to lead to everybody happy all the time--if everybody agreed, the world would be a boring place--but on the other hand, I want you to understand and please take it in the spirit in which you have talked. You want openness and debate, and so do we, but we aren't afraid to kind of engage in it. But then, please, if now and then we come down on a different side of something or disagree, don't stop, and we'll keep at it with you.
MS. SRINATH: That, you can count on.
MS. SRINATH: All of you are now invited for a reception for civil society organizations on the Mezzanine floor of this building. So, anyone who would like to continue this conversation, the Mezzanine floor of this building is where the civil society reception is.