World Bank

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The World Bank is an international financial institution that provides loans and grants to the governments of poorer countries for the purpose of pursuing capital projects. It is a component of the World Bank Group.

World Bank headquarters in Washington, D.C.
David Malpass, World Bank Group President since April 9, 2019
We’ve set two goals: ending extreme poverty by 2030 and boosting shared prosperity. ~Jim Yong Kim, 12th President of the World Bank from 2012 to 2019
This is what John Perkinsbook about being an economic hit man for the World Bank (2004) is all about. He realized that his job was to get countries to borrow dollars to build huge projects that could only be paid for by the country exporting more – which required breaking its labor unions and lowering wages so that it could be competitive in the race to the bottom that the World Bank and IMF encourage. ~Michael Hudson

Quotes[edit]

  • We’ve set two goals: ending extreme poverty by 2030 and boosting shared prosperity. How are we going to get there? Generally speaking, it divides into three main categories. One is economic growth. If you look at the greatest achievements in lifting people out of poverty, China, almost through brute economic growth, lifted 600 million people out of poverty. The second big block is investment in human beings.
  • I would encourage every single business in the world, if they haven't done it already, to become climate change literate. There is not a business in the world that can afford to ignore climate change. The investment strategies are going to change - the things we invest in are going to change. The World Bank has already pledged $6bn for building climate resilient infrastructure..We think that we need $10bn more than that.
  • The “Accelerating India’s COVID-19 Social Protection Response Programme” will focus especially on making social benefits such as subsidised food under the National Food Security Act, cash transfers and pensions etc, portable so that beneficiaries could access them from anywhere in the country, not just from their home districts... Very clearly, everybody recognises the shock (from the pandemic). The choice is being said to be between lives and livelihoods.
  • The Horn of Africa finds itself at the epicentre of the worst locust outbreak we have seen in a generation, most probably in more than a generation...Locust swarms have infested 23 countries across East Africa, the Middle East and South Asia, the biggest outbreak in 70 years... It threatens food supplies in East Africa where nearly 23 million people are facing food shortages... In Kenya, the locusts are eating in one day the amount of food consumed by all Kenyans in two days... The new World Bank programme will help farmers, herders and rural households by providing fertiliser and seeds for new crops, and cash transfers to pay for food for people and livestock. It will also fund investments to strengthen surveillance and early warning systems to make the region more resilient over the medium- to longer-term.

Quotes about[edit]

  • Some 80 per cent of the aid given to Third World countries returns to the developed world from which it came in repayment of, and interest on, the loans — so they can never become solvent. They are having to compete, through market forces, with the developed Western countries in order to receive the aid in the first place. It would be far better if they could withstand the blandishments and refuse the aid from the World Bank, the International Monetary Fund and the Western banks who have squeezed them dry for years.
  • At the heart of the problem are the Structural Adjustment Programs imposed by the International Monetary Fund and the World Bank when nations get into financial difficulty. The goal of these programs is for a nation to increase its savings and earn more hard currency so that it can pay off its debt. Thus, when the debt crisis engulfed the developing world in the 1980s, government spending was slashed, state assets were privatized, and public sector employees laid off. National currencies were devalued and export earnings were increased at any cost. This called for the cashing in of natural assets such as forests and fisheries, and the conversion of land to large-scale export farming. Urban dwellers lost their jobs and smallhold peasant farmers were forced off their land, creating an exodus of people in search of a means of survival. This growing population of economic refugees stripped forests bare to make firewood and space for growing food. This was in addition to the rapid increase in commercial logging and clearing of land for large cattle farms. Budget austerities meant government conservation programs were cancelled. The Third World's largest debtor, Brazil, also contains the largest proportion of the world's remaining tree cover, and it is busily clearing it at the rate of 50,000 square kilometers a day.
  • In 2004, oil began to flow through the World Bank-financed Chad-Cameroon pipeline. The $3.7 billion project is the second largest private investment project in sub-Saharan Africa; oil discovered in Chad’s Doba region in the 1960s would not have finally reached the marketplace but for World Bank finance. The reason: Chad is a war-torn country, the fifth poorest in the world and among the world’s most corrupt. World Bank support meant guarantees of risk insurance for the oil companies involved–Exxon, Chevron and Petronas–in the event of a civil war or other disruptions to the oil supply.
    World Bank money intended for poverty alleviation is instead being used to buy bullets and guns to fight in one of the most brutal battles being fought in the world today. It is also painfully clear, as the blood spills on both sides of the Chad border, that the consortium of international oil companies and their allies at the World Bank are being careful to make sure nothing stops a drop of oil from flowing to global markets. A fragile peace agreement brokered between Chad and Sudan on December 24 seems to be holding–for the moment. Regardless, those of us who pay taxes support the World Bank, and are thereby helping finance Idriss Deby’s brutal regime. Thanks to the World Bank, we may have plenty of oil in our tanks, but we also have blood on our hands.
  • The World Bank’s long-running identity crisis is proving hard to shake. When efforts to rebrand itself as a “knowledge bank” didn’t work, it devised a new identity as a “Green Bank.” Really? Yes, it’s true. Sure, the Bank continues to finance fossil fuel projects globally, but never mind. The World Bank has seized upon the immense challenges climate change poses to humanity and is now front and center in the complicated, international world of carbon finance. It can turn the dirtiest carbon credits into gold.
    How exactly, does this work, you ask?Quite simply: The Bank finances a fossil fuel project, involving oil, natural gas, or coal, in Poor Country A. Rich Country B asks the Bank to help arrange carbon credits so Country B can tell its carbon counters it’s taking serious action on climate change. The World Bank kindly obliges, offering carbon credits for a price far lower than Country B would have to pay if Country B made those cuts at home. Country A gets a share of the cash to invest in equipment to make fossil fuel project slightly more efficient, the World Bank takes its 13% cut, and everyone is happy. Everyone, that is, who is cashing in on this deal. If you’re after a real solution to the climate crisis, these shenanigans can and should make you unhappy.
  • On the morning of May 27th this year, the staff of the Legal Affairs Office of the World Bank encountered an ugly racial slur scrawled on the wall outside their department. Very shortly, however, the words “N–––, go home!” were erased by order of World Bank management. This was the second such episode in as many weeks. The General Counsel’s office filed an incident report with security services, much as you might do about a broken lock or a stolen purse, but word spread rapidly through the Bank. For days, black staff members waited in vain for senior management to condemn the graffiti and inform them about steps that would be taken to ensure that public displays of race hatred would be stopped. This expectation was met with silence. Senior management neither acknowledged nor condemned either incident. One week later, the Bank’s diversity policy was posted on the intranet. Period.
  • Today’s obscene levels of inequality are the result of the Neo-Liberal economic system. This extreme form of capitalism took hold first in America and Britain in the early 1980s when Reagan and Thatcher ruled, workers’ rights were trampled on, ‘society’ was a dirty word and community responsibility was abandoned to selfishness and greed. With the aid of the World Bank and the IMF, Neo-Liberalism swiftly spread throughout the world, polluting life in every city, town and village with its divisive, cruel ideology. Commercialization and competition are key principles, and have infiltrated every area of contemporary life; everything and everyone is seen as a commodity, and the size of one’s bank account determines the level of healthcare, education and housing available, as well as one’s access to culture and freedom to travel.
  • US President Donald Trump is expected to nominate David Malpass to head the World Bank, a known vocal critic of the institute's lending to China... Malpass would succeed Jim Yong Kim, who announced in January that he is stepping down three years before his term was set to expire amid differences with the Trump administration over climate change and development resources. Kim's departure is likely to become a contentious fight between the Trump administration and other countries who believe the United States exerts too much influence over the bank, which is based in Washington, DC. Kim was first nominated by former US President Barack Obama in 2012... Malpass, the undersecretary for international affairs at the Treasury Department... has been a sharp critic of the World Bank, especially over its lending to China... Last year, Malpass helped negotiate a package of World Bank lending reforms tied to a $13bn capital increase that aimed to limit the bank's lending and focus resources more on poorer countries. The reforms seek to "graduate" countries to private-sector lending and limit World Bank staff salary growth. Malpass... would still need to win approval from the World Bank's 12-member executive board. The US holds a controlling 16-percent share of board voting power and has traditionally chosen the World Bank's leader... China is the World Bank's third-largest shareholder after Japan, with about a 4.5 percent share of voting power.
  • Newly installed World Bank Group president David Malpass said on Thursday that the development lender is preparing to become "deeply involved" in Venezuela, "but the situation is still troublesome on the ground". Speaking at a press conference on the opening day of the joint World Bank and International Monetary Fund (IMF) spring meetings, Malpass said that Venezuela is a "deep concern" for the World Bank, but that any decision to intervene in the country or recognise opposition leader Juan Guaido as Venezuela's president would be left to the World Bank's stakeholders... Venezuela is in the throes of a prolonged and worsening economic crisis that has led to severe shortages of food, life-saving medicines and electricity. More than 50 nations including the United States have thrown their support behind the country's self-proclaimed interim president, Juan Guaido. Russia, China, Turkey and Cuba support President Nicolas Maduro, who has vowed to remain in power.
  • Its job is to do in the financial sphere what, in the past, was done by military force. The purpose of a military conquest is to take control of foreign economies, to take control of their land and impose tribute. The genius of the World Bank was to recognize that it’s not necessary to occupy a country in order to impose tribute, or to take over its industry, agriculture and land. Instead of bullets, it uses financial maneuvering. As long as other countries play an artificial economic game that U.S. diplomacy can control, finance is able to achieve today what used to require bombing and loss of life by soldiers.
    In this case the loss of life occurs in the debtor countries. Population growth shrinks, suicides go up. The World Bank engages in economic warfare that is just as destructive as military warfare. At the end of the Yeltsin period Russia’s President Putin said that American neoliberalism destroyed more of Russia’s population than did World War II. Such neoliberalism, which basically is the doctrine of American supremacy and foreign dependency, is the policy of the World Bank and IMF.
  • [The World Bank]... was set up basically by the United States in 1944, along with its sister institution, the International Monetary Fund (IMF). Their purpose was to create an international order like a funnel to make other countries economically dependent on the United States. To make sure that no other country or group of countries – even all the rest of the world – could not dictate U.S. policy. American diplomats insisted on the ability to veto any action by the World Bank or IMF. The aim of this veto power was to make sure that any policy was, in Donald Trump’s words, to put America first. “We’ve got to win and they’ve got to lose.”
    The World Bank was supposed to make loans for what they call international development. “Development” was their euphemism for dependency on U.S. exports and finance. This dependency entailed agricultural backwardness – opposing land reform, family farming to produce domestic food crops, and also monetary backwardness in basing their monetary system on the dollar.
  • Most World Bank loans are for transportation, roads, harbor development and other infrastructure needed to export minerals and plantation crops. The World Bank doesn’t make loans for projects that help the country develop in its own currency. By making only foreign currency loans, in dollars or maybe euros now, the World Bank says that its clients have to repay by generating foreign currency. The only way they can repay the dollars spent on American engineering firms that have built their infrastructure is to export – to earn enough dollars to pay back for the money that the World Bank or IMF have lent.
    This is what John Perkinsbook (2004) about being an economic hit man for the World Bank is all about. He realized that his job was to get countries to borrow dollars to build huge projects that could only be paid for by the country exporting more – which required breaking its labor unions and lowering wages so that it could be competitive in the race to the bottom that the World Bank and IMF encourage.
  • If the World Bank wants to streamline our social safety nets, first off, they are getting into very complicated things. The issue sometimes is not so much about how to reach the people as it is about how to get two wings of the government talking. The arguments are on two things, One, don’t over-centralise things. Where the World Bank can intervene and should is portability. Two, if I had to give out a billion dollars, then, I would give very little of that to the federal government and most of it to the states, in fact, more to the municipalities.
  • We call on all G-20 leaders through these [international financial institutions] to support the cancellation of debt obligations held by all IDA countries during this unprecedented pandemic... The vulnerable communities that lack the resources and privileges to adopt adequate public health measures will ultimately face the disproportionate burden of coronavirus... We also urge you to support a major issuance of Special Drawing Rights (SDRs) in order to provide developing countries with urgent financial support... An issuance of SDRs on the order of trillions of dollars will be required to avert major increases in poverty, hunger and disease.
  • Without sweeping relief, poor nations could be forced to “dedicate money that should be going towards protecting the health and safety of their people to pay off unsustainable debts. We cannot allow these countries to be deprived of the resources they need to purchase food, medicine, protective gear, and medical equipment. The steps that our international coalition of lawmakers is proposing are not radical. It is the very least that these financial institutions should do to prevent an unimaginable increase in poverty, hunger, and disease that threatens hundreds of millions of people.
  • The World Food Program projects that the number of people facing acute hunger will nearly double this year, from 135 to 260 million. This is mainly a result of the economic impact of the pandemic: as the World Bank has noted, this is the worst global recession since the end of World War II, and the worst ever (since 1870) in terms of the number of countries pushed into recession. It creates poverty, extreme poverty and food shortages for hundreds of millions of people in developing countries.

See Also[edit]

External links[edit]

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