The World Bank was created in July
of 1944 under the United Nations as a financial institution that would provide
loans to developing countries to encourage the growth of the country’s
infrastructure. The goal of the bank is "to end extreme poverty and promote shared prosperity", by offering low interest rate loans to help
encourage economic growth in third world countries. These loans go to the
funding of much needed infrastructure projects with the expectation that they
will fuel future economic growth. Unfortunately over its 70 year history, the
World Bank’s work as a humanitarian aid program has not always been what it is made
up to be. Many times the intentions of the World Bank are not in the right
place. The World Bank gives out loans to countries for unnecessary projects,
which end up being “prize boondoggles”.
The banks efforts are not concentrated in a way that regulate the use of these
loans for programs that will succeed and pay themselves forward for decades to
come. The bank has also been caught up amongst human rights violations, where
they have basically financed human rights abuses.
The World Bank’s slogan
“our dream is a world free of poverty” seems misguided at times. I don’t mean
to bash the World Bank because a lot of the work that they do is great. But
there have been instances where it seems that the goals of the organization are
not to reduce poverty in third world countries but rather to give out as many loans
as possible. The organization has been caught trying to get countries to take
more money then they need, driving these countries into massive debt leading to
default. The World Bank measures success not in the amount of humanitarian work
that they do but rather the amount of money that they give out. They have been
compared to a Soviet factory, “concerned only with meeting its quantitative
production goals”. Money does not equal
improvement, concentrated efforts to use that money to reduce poverty equals
improvement.
The World Bank’s lack
of regulation of the money they give out has led to not only massive debt in
some countries, but also human rights abuses. The bank loans money to countries
without providing adequate checks on the uses of the money. Because of this the
bank has unknowingly financed numerous programs, which have jeopardized the human
rights of the citizens in those third world nations. The group, Human Rights
Watch has documented three cases where the World Bank, "neither acknowledged the human rights risks of the programs it financed nor took steps to mitigate the problems". The World Bank is only making situations worse when it funds international development efforts that lead to human rights abuses.
The World Bank needs to be held accountable for the money, which it is loaning out to third world countries. There needs to be policy change on the part of the World Bank to ensure that they are funding programs, which are helping the people of these developing nations. If regulations can be put into place to hold the World Bank accountable then the possibilities are endless for this organization. They can once again work to achieve their dream of a world free of poverty.
The World Bank needs to be held accountable for the money, which it is loaning out to third world countries. There needs to be policy change on the part of the World Bank to ensure that they are funding programs, which are helping the people of these developing nations. If regulations can be put into place to hold the World Bank accountable then the possibilities are endless for this organization. They can once again work to achieve their dream of a world free of poverty.
Sources:
Trevor, you raise very good points about the problems with the World Bank, including lack of regulation or checks on the money it gives out, as well as perhaps not always having the purest intentions it claims to have. The question I would ask is, when you say increased oversight or accountability is necessary, where should this come from? Should the World Bank police itself, should the United States take the lead, or should an organization such as the UN hold the bank accountable? Overall, this was a very good analysis of some of the problems involved with the World Bank.
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