The World Bank, IMF, and MDGs [Week 3]

1. The main goal of the World Bank is to act as a resource for reducing poverty in developing nations through financial aid. They also focus on fulfilling the Millenium Development Goals, but as a financially-centered organization, also work with other countries in order to meet thses needs. The IMF (International Monetary Fund) however, is more focused on helping those developing countries that are struggling economically, perhaps due to events that have transpired in their countries or more long-term scenarios. A major difference between the two is that the IMF’s financial support is in the form of a loan, meant to be repaid.

I personally wanted to look for some different opinions about the World Bank and IMF, and I came across the Global Exchange, a non-profit organization that has heavy criticism against both. After reading their reasons that the IMF is trouble, it led to questioning on my own behalf. Although the they are probably responsible for helping many countries that don’t have anywhere else to turn, it also makes sense that some stipulations could be applied for recieving aid. I remembered from the previous week’s material that a stipulation for recieving aid from the organizations sometimes means cutting funding on important public programs in many countries, so it is a cause for wonder who the World Bank/IMF answer to, and if there is someone to balance the power they have over many developing nations.

2. Since the goals are broad and cannot be taken directly as targets for individual countries, I believe that each country needs to address the goal it finds most pressing. Each of the MDG goals were selected with the knowledge that if they were achieved, they would developing countries on the road to recovery and growth. The progress of the MDGs is different for every country, and each one should focus on the goal that has the least progress. The goal that they are the most behind on will likely go unaddressed after the time period set for fulfillment had passed. It is better to have achieved some progress in all the goals (and have somewhere to start from in continuing that progress) than to have completely finished goals and completely unfinished goals.

According the MDG UN Report and the Road to 2015, many countries who are struggling to reach the goals are low-income nations. A country that has been struggling to reach the goals, however, should focus their efforts on survival of the people. That means putting goals such as eradicating extreme hunger and povery (MDG #1), improving maternal health (MDG #2), reducing child mortality (MDG #4), and combating disease (MDG #6) should be put first, as survival of the people themselves is necessary to go on to other goals. This can be applied to countries such as Botswana, as shown in the report on page 17, where their low income as a nation means the most critical goals should be addressed.

a. While Steve Radalet detailed the progress achieved by a few Sub-Saharan African countries, according to The UN Report & Road to 2015 the region is slow to achieve the MDGs as a whole. In the UN’s Millenium Declaration, Africa’s needs are addressed specifically, which does mean that the region as a whole has struggles that cannot be grouped in with others. It also has a significant imbalance, with 43% of the region being areas of a fragile or conflict-affected. This does not mean that they cannot achieve goals that have been laid before them, but rather, have further to go.

Social spending is important because it is an investment into an individual nation itself, or rather, directly addressing needs in the form of programs accessible to the people who need them. It is mostly classified as funding set aside by the government for relief of the poor in many countries. Its preservation, especially in Africa, can lead to the type of aid that has the most effect.

b. Effort on many parts is needed to keep the MDGs on track. Developing countries need to focus on their growth as a nation, both in their global growth as well as economic. Developed countries can best aid this by fulfilling the financial promises made to developing nations as well, as well as making sure that trade relationships are negatively affecting these countries. Often developed countries can put harsh stipulations on terms for receiving aid, or in a more discreet manner, impose harsh trade regulations that burden already-broken economies.

In this instance, I chose Botswana, which is doing well aside from setbacks that plague the sub-Saharan region. Most of the population has access to clean water, and primary school education is vastly above what the average for the region. However, it was difficult to attain more information regarding the World Bank’s indicator human development. Since there was another used by the United Nations, perhaps the indicator has been altered since then?

3. Oxfam’s main points of criticism seem to lie with developed countries and the World Bank. There is a need for developed countries to adhere to not only the financial aid that they promised, but also to also work in conjunction with developing countries to help bring them up globally.

There is also criticism towards the World Bank, where critical funding needed to achieve goals is heavily protected and difficult to access without some kind of trade-off. They propose a tax on the World Bank in order to attain the necessary funds. Efforts towards eliminating hunger and environmental change are their more recent concerns.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s