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Whose Civil Society? Whose Governance? Decisionmaking and Practice in the New Agenda at the Inter-American Development Bank and the World Bank.

Governance and civil society are relatively new themes in the discourse of the multilateral development banks (MDBs). As objectives of MDB policy and lending, good governance or modernization of the state and civil society involves a common core of issues for the MDBs: transparency, accountability, effective public sector management, and public participation in making and implementing policy.

But governance has a second meaning in the context of MDBs: it refers as well to their self-governance and decisionmaking as organizations. In this essay, I focus on the evolving tensions between the governance policies, their implementation, and the governance processes of the World Bank and Inter-American Development Bank (IDB).

The MDBs' increasingly explicit involvement in governance issues responds, in part, to the changing priorities of some of their principal shareholders (the member governments that own and govern them). But they are also complex organizations with their own cultures, leadership, and agendas.

The adoption and implementation of new agendas by MDBs follow distinctive and observable patterns. Broadly, the World Bank adopts new lending modalities and mandates on a global level at the initiative of Northern governments and with the encouragement of nongovernmental organizations (NGOs). New mandates and institutions, such as information disclosure and investigative mechanisms, are often contested and evolve as they are implemented. [1]

Regional in scope, the IDB typically adopts new mandates and modalities by negotiating a regional agreement, often after a policy is institutionalized at the World Bank. The resulting change is often less dramatic on paper but enjoys greater assent and ownership by the borrowing governments. In governance, the 1DB has built on borrowing member governments' stated commitments to some principles of a democratic and modernized state and to strengthening civil societies.

The governance and civil society initiatives follow a decade of changes that arguably made MDB-related decisionmaking less open to broad participation. Negotiations over adjustment policy tended to privilege finance ministries over other government ministries, and economic reform packages effectively reduced the influence of interest groups such as organized labor and small agriculturalists. Second-generation reforms move beyond macroeconomic policy to address institutional and social policy issues. They involve more detailed conditions, specifying policy and implementation, but also endorse principles such as participation and accountability in public life.

I advance an interpretation of the adoption and implementation of governance and civil society policies at the two MDBs that rests on four arguments. First, the governance and civil society mandates shift certain decisionmaking authority from boards that represent member governments to management and staff. [2] This shift of authority has been selective and contested in both MDBs, and decisionmaking at board, management, and staff levels can now involve debate and contestation among member governments, management, staff, and civil society organizations (CSOs). Second, whereas the IDB makes its civil society program a component of its modernization of the state initiative, the World Bank ties its civil society work principally to the themes of increasing popular participation, reducing poverty, and improving project performance. The World Bank has a much more extensive engagement with CSOs--principally NGOs--both in project cooperation and in NGO criticism of projects and policies.

Third, the World Bank's style is more prescriptive, whereas the IDB allows staff and borrowers to negotiate within broader policy guidelines. World Bank policy on governance provides specific, well-defined directives, linked to economic efficiency. Loans often include detailed conditions. IDB governance policy is defined more broadly, couched in terms of modernization of the state and (according to the IDB) based on a regional consensus. Fourth, the IDB's borrowing member governments have been relatively effective in shaping new policies and institutions through the IDB's governing board. The World Bank's borrowing members, which hold less formal power in these decisions, have exerted influence instead by shaping the daily operation and implementation of new civil society and governance policies. The World Bank's policies for information disclosure and independent inspection panels, as a result, create a stronger institution on paper but encounter strong resistance in practice.

I begin by tracing the origins, content, implementation, and evolution of civil society and governance policies at the IDB and World Bank, respectively. Each has developed distinct structural and cultural characteristics that shape the framing and implementation of these initiatives. I then compare the programs of these two MDBs and examine how governance within the MDBs has changed to reflect the governance principles they promote to their borrowers. Whose participation has grown in MDB decisionmaking and to what effect? How have the several accountability relationships among MDBs, member governments, and civil societies been altered? Finally, I raise issues regarding the MDBs' influence and limitations in the region's governance practices.

The IDB Modernization of the State and Civil Society Initiative

Several distinctive characteristics of the IDB have decisively shaped its governance and civil society initiatives.

1. Regional identity and voting structure. The IDB is an institution of the Latin American and Caribbean region. Its borrower members are majority shareholders and perceive themselves to have decisive influence in key decisions. Unlike the World Bank, the IDB rises and falls with the fortunes of its regional borrowers.

2. Regional leadership. The IDB has assumed important leadership roles in the region. It is the leading development lender; it coordinates donor meetings for countries in the region; and its president, Enrique Iglesias, often acts as a regional statesman, participating extensively in regional policy discussions. Its lending ($6.03 billion for ninety-nine lending operations in fiscal 1998) [3] has eclipsed that of the World Bank ($4.56 billion), and the IDB now chairs or convenes most consultative groups and other donor coordinating bodies in the region.

3. The special relationship. The IDB's special relationship with and cultural understanding of its borrowing members are central to its mythology--and to its identity. A relationship of trust and solidarity affords the IDB a posture from which to promote governance changes as an expression of a regional consensus but may make it more difficult for the IDB to develop independent relationships with civil society organizations. Key decisions and initiatives are often grounded in deliberative processes that occur outside of the IDB's governing structure.

4. Evolving relationship with the World Bank. The IDB's identity is to some extent defined in comparison to the World Bank. Throughout the 1960s and 1970s, the IDB was the leader in social sector lending and in lending to the region's smaller, poorer countries, and it established extensive representation in each borrowing country. During the 1980s, the IDB became more closely identified with the World Bank's economic liberalization and integration agenda. The different approaches of these two MDBs to governance and civil society may contribute to a more distinctive identity for the IDB.

The policy document governing the IDB's eighth replenishment placed modernizing the state and strengthening civil society among the IDB's top priorities, [4] and the 1997 policy paper Modernization of the State and Strengthening of Civil Society [5] sets the agenda. Modernization envisions regional governments and the IDB cooperating to consolidate democracy, strengthen democratic institutions, and reinforce the internal political consensus in favor of a "modern state" and liberal economic policies. [6] It outlines broad, almost unrestricted "spheres" of IDB governance activity based on a growing regional consensus. [7]

Those spheres--executive, legislative, justice system, and civil society--open the entire political system to IDB assistance. The modernization program stresses the integration of new programming with social and economic objectives (comprehensiveness, transparency, competition, social equity, efficiency, effectiveness, participation, subsidiarity, and gender equity). [8] The very term modernization suggests continuity with the modernizing theme of development in the region.

The options outlined for assistance to justice systems illustrate the breadth of the IDB agenda. In addition to undertaking administrative and statutory reforms, training judges, and improving the physical infrastructure (the elements of the World Bank's judicial reform mandate), the IDB is authorized to assist in prison reform and the training of investigative forces, [9] to promote "alternative methods of conflict resolution," to encourage respect for human rights and property rights, and to support measures that combat "discriminat[ion] against women or indigenous peoples." [10]

The Origins

The 1994 Summit of the Americas helped to define this consensus. Governments, the IDB, the UN Development Programme, regional NGOs, intellectuals, and other regional bodies debated political and economic priorities. The resulting paper, "Our Common Agenda for the Americas," spells out a broad agenda for consolidating democracy and reconstructing the state and provides a framework for the IDB's modernization agenda. [11]

Governments affirm that their "primary task" is to "create a strong political and social majority" for democracy and the rule of law, a "conscious and self-reliant citizenry." [12] The democracy agenda is broad: democratic governance, strong judiciary, reconstructed state institutions, freedom of the press, rights of indigenous peoples, human rights, reduced violence, reduced drug use and trafficking, and a "culture of peace." [13]

An emerging liberal democratic aid agenda among aid donors also supported the IDB governance agenda. In the hemispheric Santiago Consensus, donors, states, and intellectuals have affirmed that national and subnational governments should be strengthened for revised roles under liberal economic reform. [14]

The IDB characterizes its governance work as supporting an "unprecedented consensus in the region that the marketplace is the most effective resource allocation mechanism, and that democratic systems must be consolidated." [15] The IDB's "special dialogue" with governments and "knowledge of the culture of the region" give it operational advantages [16] and make it, in the IDB mythology, a participant in the consensus process. [17]

Implementation: Civil Society and Modernization in Practice

Modernization of the state and strengthening of civil society strategies consist of (1) providing funds and technical cooperation for public sector management; (2) promoting national dialogues to build consensus on civil society roles; (3) training and educating IDB staff to integrate civil society work into IDB operations; and (4) engaging in dialogue with NGOs and civil society organizations on sector and Bank-wide policies. The content of the IDB's modernization initiatives and the World Bank's governance and civil society agenda are summarized in Table 1.

The IDB's approach to civil society appears in documents such as those of the 1994 Conference on Strengthening Civil Society, which stressed civil society's potential to organize broad participation in the political processes of a modernized state. [18] Its civil society initiative is both conceptually and bureaucratically an aspect of the modernization of the state program. The modernization of the state and civil society (SCS) unit coordinates programming, and the unit's director manages budget and policy decisions for the civil society initiative. The SCS unit's responsibilities include providing internal training, holding government--civil society consultations, "mapping" civil society organizations, and helping to promote national civil society cooperation through advisory groups and project collaboration. The SCS agenda focuses not on strengthening civil society itself but on facilitating dialogue between member states and CSOs.

Consultants rather than new hires have staffed the civil society initiative, and the SCS director manages staff and budget. Staffing and operation of country offices, in contrast, have drawn the IDB board's attention. Country offices are assigned responsibility for shaping the IDB's expanded dialogue with stakeholders. But in 1996, a task force concluded that country offices had not kept pace with changes in loan portfolios and increasing cooperation with the private sector, NGOs, and other donor agencies. [19] The board responded by authorizing a "country office strengthening exercise" in 1997. [20]

The Civil Society Interactions: Consultations and Confrontations

Much of the IDB's dialogue with civil society organizations has taken place in highly structured, planned consultations. But the dialogue also features challenges by NGOs to planned projects with potentially adverse environmental impacts. In this section, I take up these two somewhat contrasting processes.

Consultations have been organized nationally and on IDB sector policies. The IDB enlisted the New York-based Synergos Institute to facilitate three national consultations in 1995 and 1996. The consultations brought government and civil society leaders together under IDB sponsorship to discuss possible joint implementation of projects, the legal and fiscal environments in which CSOs operate, and the improvement of financial sustainability and capacities of the "civil society sector." [21]

Synergos describes the consultations in Mexico, Colombia, and Brazil as "extremely productive and dynamic." [22] But the process "can present major challenges," as in the Mexican case, "where there is no clear consensus with the government on how to relate to civil society." [23] The Mexican consultation focused largely on IDB funding for civil society social sector programs, including the proposed Fund for Chiapas. [24] The IDB has also sponsored "consensus-promoting activities," including 1996 strategy meetings in Washington, D.C., on corruption, national forums in Honduras and Guatemala on justice, and a conference in Buenos Aires on civic education. [25]

CSO consultation on sector policy was initiated in 1996, when a working group coordinated by the Washington Office on Latin America (WOLA) met with staff of the Social Programs and Sustainable Development Department and the Environment Division to design a process for civil society comment on new sector strategy papers. The IDB agreed to solicit comments on draft papers from interested organizations and individuals in the region, and WOLA and the Bank Information Center wrote to hundreds of CSOs in the region in August 1996, outlining the process and inviting them to participate. [26]

The agreed-upon process was tried first on the energy and labor market strategy papers. The IDB accepted a list of more than seventy NGO and trade union contacts in the region to whom draft labor market strategy papers were sent. Bank-wide sector strategy processes have been more accessible to CSOs than have most country-specific planning processes, apparently because no government has a strong enough stake in the strategy papers to block the circulation.

NGO engagement with the IDB remains relatively low in Washington, compared with NGO advocacy and collaborative work with the World Bank. The working group sponsored a series of educational forums in 1997 and 1998 to promote dialogue between NGOs and IDB staff and management. Some working group participants also lobbied the U.S. Congress in support of funding for the Bank's concessional lending facility, the Fund for Special Operations. [27]

Confrontations over projects with adverse social or environmental impacts have been less frequent and have had little impact at the IDB. Members of the NGO working group worked with local CSOs, for example, to influence the $16 million Belize Road Project. The project sparked concern from organizations of indigenous peoples in Belize in 1997, who supported road construction but feared the effects on their tenuous land rights if land tenure and indigenous rights laws were not strengthened and clarified. With support from the Washington-based Center for Democratic Education and the Bank Information Center, NGOs succeeded in having the project held back from the IDB's project pipeline in September 1997. When the IDB board approved the project in January 1998, it appended a record of correspondence and negotiations over the land rights issue to the project document, a partial victory for NGOs that continue to press for stronger legal standing.

A second NGO intervention also delayed but did not block a private sector loan for the coal-fired Enersur Power project in Peru. CSOs in the project area emphasized that they supported IDB financing for the plant but objected to its planned location and to its rapid development. Local organizations received the project for review and comment just three weeks before the board was scheduled to approve it. [28]

Corporate borrowers' desire for rapid project approval appears to be in tension with the civil society, transparency, and participation mandates. NGOs argue that when civil society's rights to informed participation conflict with a company's desire for expedited loan approval, civil society's rights should be protected. By delaying board consideration, the IDB seems to have agreed in this case.

CSOs have had to be content with minor inroads such as these at the IDB. The IDB's civil society agenda is dominated by consultations and restrained by the effective power of borrowing member countries in a regional organization that relies on its status as a consensus builder. In the following section, I outline the similar content but contrasting politics of governance and civil society at the World Bank.

Governance and Civil Society at the World Bank

The World Bank's governance initiative was formally launched in 1991, when its board approved a staff paper on governance and development. [29] It is a contentious issue, seen by some borrowers as introducing onerous, intrusive new conditionalities. Governance is a challenge for the World Bank, and certain distinctive features have shaped its governance and civil society programs.

1. Governance issues are primarily driven by the World Bank's economic policy agenda. This is true both by legal obligation (the charter restricts its "political activities") and in fact: implementing economic reform dominates public and internal discussions of governance.

2. The World Bank's approach is more prescriptive than the IDB's. Paradoxically, the proscription against political activities and dominance of economic justifications for governance work promotes a prescriptive and politically intrusive style that specifies "correct" institutional approaches rather than encourages internal dialogue and an evolving national or regional political culture. Representing governance and civil society initiatives as means to improve economic performance insulates them to some extent from attack by borrowing member countries.

3. The World Bank has a measure of autonomy from borrowing members in any region. No regional member has the degree of influence over its governance that borrowing members have in the IDB. This arm's-length relationship with borrowing governments contributes to the tendency to be prescriptive, and to its comparatively open approach in building relationships with CSOs. The World Bank has also been a central target of NGO environmental, human rights, and antipoverty campaigns for two decades. [30]

4. The formal governance agenda is narrowly defined, but governance-related initiatives have broadened the mandate since it was announced in 1991. The growth of the governance agenda is consistent with the rapid expansion of the World Bank's agenda since 1980. Management has not reopened the board's discussion of governance issues but has instead added initiatives independently of the governance rubric.

5. The civil society and governance agendas have emerged at the same time as new emphases on client satisfaction, demand-driven programming, and lending to the private sector. All of these agendas involve decisions about how state and nonstate actors participate in World Bank activities, and their simtiltaneous growth at the World Bank affects choices about the governance agenda's implementation.

The Origins

The growth of a liberal democratic aid agenda helped to shape the Bank's governance initiative. But frustration within the organization concerning the performance of borrowing governments under Bank-financed structural adjustment plans has driven the adoption and evolution of the governance initiative. The governance initiative grew primarily from concern that some borrower government institutions could not--or would not--implement economic adjustment policies. Trade, fiscal, and exchange rate reforms could be accomplished quickly, but institutional changes "are likely to remain incomplete a decade or more after the economic policy changes are in place." [31]

When a 1990 long-term perspective study on Africa suggested that some borrowers in that region were willing to discuss governance concerns, the board requested a paper from staff on the subject. The paper, Governance and Development, stressed "sound development management" and focused on the four themes that became the World Bank's official governance agenda. [32] Subsequently, the 1992 report on effective implementation (the Wapenhans Report) added to the internal pressure to achieve better "development results." [33] Staff interest in public sector management was also sustained in the 1980s by an informal annual staff symposium on public sector management. [34]

The growing support for liberal democratic reforms by major aid donors was also felt on the World Bank's board. The United States, Nordic countries, Germany, and the Netherlands have supported governance initiatives, with some agreement from the Latin American representatives. The support of some members from the region, notably Moises Naim of Venezuela, now an adviser to World Bank president James Wolfensohn, helped avoid the appearance of a complete North-South split. [35] Much of the borrowers' caucus, the Group of 24, has resisted expanded political conditionality. [36]

Core Agenda

Governance policy at the World Bank is formally based on a well-defined core agenda. But governance-related activities have grown to address an expanding agenda of institutional and policy issues. The staff paper Governance and Development narrowed the issues to four central themes: public sector management, accountability, legal reform, and transparency. The Bank's 1997 report on world development, The State in a Changing World, reinforces these themes and places them in the context of five "fundamentals" that are "the core of every government's mission": establishing a foundation of law, maintaining macroeconomic stability and limiting economic policy distortions, investing in basic social services and infrastructure, protecting the vulnerable, and protecting the environment. [37]

If the report's governance themes are relatively broad, the articulation of an agenda for governance in the World Bank's Latin America region is specific and demonstrates the Bank's willingness to prescribe and promote a regional governance agenda. The Long March: A Reform Agenda for Latin America and the Caribbean in the Next Decade emphasizes the importance of civil service reform, decentralization and service delivery, judicial reform, and reduction of corruption, crime, and violence to sustaining economic reform and reinforcing investor confidence in the region's governments. [38]

The Long March introduces two political risk indices as measures of borrowers' effort and success in improving governance. The indices were created by private firms to help investors assess risk, and they rate such variables as expropriation, government repudiation of contracts, quality of bureaucracy, enforceability of contracts, and bureaucratic delays. [39] Adopting these indices signals to governments that the World Bank's priorities for governance reform are those aspects of direct concern to foreign and domestic investors.

The vice-presidency's annual comment on regional priorities, Dismantling the Populist State, is equally direct: The "economic and social structures of the traditional Latin American state" must be replaced with a "modern, efficient, administrative state." [40] It calls the election of an antireform president in Ecuador a "disappointment" and the search for alternative economic policies by an "anti-reform" movement "disturbing." [41]

Expanding Governance Agenda

The formal governance mandate is narrow, and the World Bank does not classify military spending, corruption, human rights, and the legal and regulatory environment for NGOs as governance issues. But these issues have direct implications for governance institutions and processes of borrower governments, and they constitute an expanded agenda that has taken root in the World Bank under pressure from major shareholders. I summarize this agenda in Table 1 and outline the Bank's involvement in three of these issues in the following sections.

Military spending. The World Bank's concern about military spending has roots in the process of public expenditure reviews. In times of fiscal austerity, these reviews make it difficult for Bank staff to ignore very high resource commitments to the military, and pressure from the U.S. Congress and the IMF's initiatives in the field have also helped to encourage interest within the World Bank.

The Bank characterized its first review of a country's military spending priorities (which looked at Argentina) as "treating military expenditures as essentially no different from other categories of spending," and as wanting to "avoid making judgment about military expenditures." [42] The review urged that military spending be placed "on budget" and be openly debated to promote greater transparency and more effective planning. [43]

Corruption. At the Bank's annual meetings in 1995 and 1996, Wolfensohn remarked on the corrosive effects of corruption on governance and development. Although his remarks were controversial, they were hardly the World Bank's first involvement in the highly sensitive topic. Most of the Bank's early work in the area has been carried out through an NGO, Transparency International, founded by former World Bank career staffer Peter Eigen.

Wolfensohn established an internal working group and the high-profile Anti-Corruption Knowledge Center to support efforts of staff and of other agencies. An anticorruption thematic group, located in the Economic Development Institute, offers training and diagnostic tools to staff and borrowers. The center has released a range of publications on the extent and effects of corrupt practices, and on strategies for reducing them.

Human rights. World Bank policy carefully maintains a focus on "those rights that are economic and social in nature." [44] Judicial reform programs, for example, focus on activities with a direct economic justification, promoting reliable and enforceable contracts [45] but not prison reform or criminal law revisions. The Bank asserts, however, that its reform agenda can advance social and economic rights and have indirect effects on excessive judicial discretion. [46]

The International Center for Not-for-Profit Law worked with the Bank to develop a handbook of global guidelines for laws and self-regulatory norms governing NGOs, on topics such as freedom of assembly, and tax, legal, and regulatory constraints. The Bank will use the handbook, released in 1997, on an on-demand basis, offering advice when a borrowing government expresses interest.

Implementation: Governance and Civil Society in Practice

Responsibility for governance work rests with country departments, but specialized expertise on the governance agenda is located primarily in two parts of the World Bank. Specialists in the Public Sector Management division (within the Poverty Reduction and Economic Management Network) are to be available as country offices require. Anticorruption initiatives have been placed within the Economic Development Institute, and seven professional staff have been assigned to policy, training, diagnostic, and other roles. [47]

Civil society specialists--and responsibility--are more broadly dispersed in the organization. NGO specialists can be found in External Affairs, in the poverty division of the Poverty Reduction and Economic Management Network, and in a high-level central office on partnerships, under the strategy and resource management vice-presidency. They include at least six staff or long-term consultants in Bank headquarters hired from within the ranks of NGOs in the U.K., the United States, or Latin America.

In a period of staff reductions, retraining has been emphasized over new hiring. Management training programs for Bank staff now routinely include a few NGO and private sector representatives, and the World Bank's Economic Development Institute and Learning and Leadership Center offer joint courses for borrowing government officials and Bank staff on topics such as public expenditure review. [48] Training programs are only a part of management's approach under the new reorganization. By introducing elements of a market for knowledge and services into the Bank itself, it is hoped that the skills most in demand for projects will be promoted and that the skills mix will change over time in response to borrowers' demand for services.

Project Lending

Loans for judicial reform and public sector management loans to sub-national governments are the new features of lending under the governance rubric. In its 1997 fiscal year, the World Bank lent $600 million in support of eight public sector management projects in Latin America. Three loans, totaling $420 million, are for pension reform in Argentina and Peru; two primarily support privatization in Guatemala and in the Brazilian state of Mato Grosso. One, to Ecuador, is for judicial reform. The others (to Jamaica, Guatemala, El Salvador, Colombia, and Brazil) promote changes in government management more broadly as do multisectoral loans to Haiti and Honduras.

A 1994 Governance report reviewed two years' experience, emphasizing traditional public sector management lending and market-related initiatives such as transparency in private and public sector financial reporting systems. [49] A second scheduled report for 1996 was delayed until fiscal 1999, a delay that had the benefit, for World Bank management, of postponing renewed debate on the board. [50]

Involving Civil Society:

The Dominant Role of International NGOs

NGOs' extensive contacts with the World Bank are summarized in a Bank annual report on cooperation with NGOs [51] and involve the Bank's NGO unit, the environmentally sustainable development vice-presidency, the operations evaluation department, the private sector finance department, and the International Finance Corporation (IFC). The World Bank's liaison with NGOs consists of two contrasting strands: highly conflictive encounters over infrastructure projects, structural adjustment, energy policies, and indigenous peoples; and cooperation in the implementation of Bank-financed projects in sectors from health care to judicial reform.

High-volume encounters over infrastructure projects have indirectly helped to encourage more collaborative strategies. Involuntary resettlement is one of the few loan sectors where policy mandates participatory procedures, and World Bank staff are eager to avoid public controversy over Bank-financed projects.

Both the World Bank and NGOs themselves often treat NGOs as a proxy for civil society. Its handbook on NGO law, annual reports on NGO operational collaboration, and maintenance of a joint NGO--World Bank committee suggest the privileged standing given to NGOs. U.S.-based trade unions, in contrast, have little relationship with the World Bank. Some board members and staff increasingly criticize the assumption that consulting or contracting with an NGO to implement a project component will promote effective participation.

World Bank management has at times initiated cooperation with NGOs that goes beyond what member governments are prepared to support. The Structural Adjustment Participatory Review Initiative (SAPRI), for example, is a joint review of national adjustment programs by the Bank, NGOs, and borrowers, proposed by U.S.-based NGOs and authorized in 1996 by President Wolfensohn. SAPRI proposed joint discussions that could allow greater domestic exchange between CSOs and government ministries.

But the prospect of public debates over adjustment policies with opposition groups and representatives of poor communities has not been attractive to many borrowing governments. Worldwide, none of the Bank's largest borrowers agreed to participate. The project was formally launched in July 1997 and involves eight countries: Bangladesh, Ecuador, El Salvador, Ghana, Hungary, Mali, Uganda, and Zimbabwe.

The adoption and growth of governance and civil society programs conform to a historic pattern of expansion of the World Bank's mandate. Expansion was rapid, for example, in the 1980s, with policy-based adjustment lending, the environment, and further social policy initiatives. The growth accelerated in the late 1980s and 1990s to include postconflict assistance, limited grant programs for NGOs, supervision of the Global Environment Facility, and the Consultative Group for Aid to the Poorest, a microenterprise lending forum.

Expansion into governance and civil society stretches the proscription on political involvement. Governance conditionality builds on a history of project or adjustment loans that stipulate institutional, regulatory, legal, and even constitutional changes needed to implement project components or loan conditions. Loans have required the creation of interministerial commissions to manage adjustment processes, new cabinet-level ministries, and revised civil service, labor, and tax codes, leading one critic to call the World Bank a "de facto sovereign" and a "governance institution." [52] In the next section, I contrast this expanding agenda and prescriptive style with the IDB's approach.

Comparing the Lenders: Patterns and Significance

The governance and civil society policies of the World Bank and IDB have developed in remarkably similar ways. The broad similarities are an example of the increasing standardization of development finance and its norms for institutions and economic policy. But there are also important differences in the politics and institutions involved in the two MDBs' entry into governance policy. In this section, I discuss three distinctions; later, I examine the significance of these distinctions for the MDBs and for the politics of development finance.

Institutional Postures: Prescriptions or Consensus

The World Bank's relative autonomy from borrowing governments shapes its approach to governance and civil society programs. Major publications, The Long March and Dismantling the Populist State: The Unfinished Revolution, promote its governance agenda in a rather direct style. Although the IDB considers its modernization of the state initiative to reflect a regional consensus-building process, the World Bank's report on the reform agenda for the coming decade is the result of a consensus-building process that took place during a 1996 retreat of World Bank regional staff. [53]

Lacking the IDB's special relationships with most borrowers, the World Bank has moved more rapidly to build working relationships with civil society and corporations. It maintains a database on NGOs and encourages staff to contract with NGOs in environmentally sensitive projects and in social investment funds. Conversely, although the IDB's special relationship may constrain its relationship with civil society, it may give the IDB a comparative advantage in having frank discussion and effective programming on governance.

Conceptualizing the Civil Society and Governance Roles

The IDB's statist approach links civil society to the modernization of the state, whereas the World Bank's more instrumental and market-oriented strategy ties civil society to its participation and antipoverty mandates and promotes good governance as a route to expanded investment and growth.

Conceptually and organizationally, IDB civil society work is embedded in the modernization of the state initiative. By deploying the term modernization, the IDB effectively ties governance to the state. The modernization of the state initiative is also closely linked to the IDB's broader development mission. A 1998 report on lending under the eighth replenishment makes this link explicit, reporting (under the heading "Modernization and Integration") on IDB action in these "priority areas": financial sector modernization, agricultural modernization, and modernization of the public sector, which embraces the state/civil society initiative. [54]

The World Bank's approach to civil society is more instrumental, emphasizing NGO collaboration in projects. Similarly, the World Bank's governance program places less emphasis on the norms of the modern, democratic state than on the advantages of good governance for investment and development.

Both MDBs have assigned responsibility for civil society relations and policy to various divisions within their structures. At the World Bank, responsibility is divided among the Partnerships Unit, the NGO Liaison Unit, the Operations Evaluation Department, and External Affairs. Responsibility in the IDB is less splintered but still divided among external affairs, the Modernization of the State and Civil Society Unit within Development Policy and Planning, the Legal Unit and procurement adviser (for corruption work), and specialists within the Sustainable Development Department's Human Resources and Social Development Unit.

Embracing New Policies: Global Norms, Regional Variation

There is a discernible pattern in nearly all areas of governance and civil society policy: World Bank adoption of a policy precedes the IDB's and creates a standard for approaching participation, information disclosure, corruption, and other governance issues. The IDB adapts and revises the World Bank's global approach in ways that reflect the attitudes of regional governments toward the new policies. Meanwhile, the implications of the World Bank's reforms are worked out through a process of application, resistance, advocacy, and variation that may weaken the original reform (as with the inspection panel) or broaden and strengthen it (as in anticorruption and NGO participation).

Consider the two MDBs' information disclosure and independent inspection policies. The IDB has followed the World Bank in accepting new information disclosure policies and investigative mechanisms. The IDB's initiatives differ from the World Bank's, placing limitations on its information disclosure policy that reflect borrowing governments' wishes and giving its investigation mechanism substantially less independence and authority than the World Bank's independent inspection panel. [55]

However, the IDB's modernization initiative encompasses a broader and more loosely defined set of issues than the World Bank's. On the one hand, this may place the IDB in a better position to support governance reform based on governments' expressed commitment to institutional change. On the other hand, the absence of clear mandates for new lending make it difficult to distinguish between rhetorical support--what Allison Van Rooy calls a "rush to vocabulary" in civil society and governance--and substantial programmatic changes. [56]

The IDB approach--setting broad policy without mandating programming--also tends to shift effective decisionmaking from policy-setting bodies of management and board to the staffs operational decisionmaking process. Such a loosely framed policy reduces opposition and leaves broad discretion with the IDB's country offices and borrowing government officials.

Whether they are prescriptive, instrumental, market-driven, and global (the World Bank) or negotiated, statist, and regional (the IDB), these governance principles have implications not only for borrowing governments but for the MDBs themselves. These implications are the subject of the next section.

"Modernizing" the Lenders? Implications of Governance and Civil Society Norms for the MDBs

Have the MDBs' policies and structures become more open, participatory, and accountable? If so, to whom? I begin this section by discussing the content of governance and the context of MDB governance to identify the terms in which governance is evaluated and to make explicit the power relations within which MDB governance takes place.

The Content and Context of MDB Governance

Determining which issues are key to the governance of the MDBs appears to depend on where one sits in the discussion. For many member governments and some observers, the critical components of MDB governance have to do with the authority and privileges of members: voting rights, decision processes on the boards, privacy of bank-client information, and the nature of conditions attached to MDB loans. Some borrowing member governments express fear of the World Bank being "captured" by NGOs, becoming more effectively accountable to a Northern agenda expressed through international NGOs than to borrowing clients. [57] Conditionality in general and governance policies in particular are flashpoints in this controversy.

To most CSOs, governance of the MDBs has to do with the transparency and accountability of the institutions to CSOs affected by their programs and with the ability of CSOs to participate directly in the design and implementation of MDB-financed projects.

I survey aspects of the MDBs' governance structures using categories drawn from their own governance agendas, and which are admittedly closer to the NGO agenda: participation, transparency, and accountability. I treat the issues of openness and accountability to member governments (to which Ngaire Woods has called attention [58]) within the framework of participation, transparency, and accountability. Rightly understood, these themes are relevant to all the relationships among the MDBs, member governments, and CSOs.

The context of power relations within which MDBs operate is important, because formal governance arrangements do not necessarily reflect the power of members in decisionmaking. The political and economic dominance of the United States in the hemisphere is better reflected in the weighted voting of the World Bank than in the IDB, where borrowing members hold a majority of the votes. U.S. resources and influence outside of the IDB are likely to augment its influence within the IDB.

Corporate actors also have significant influence over some decisions at both MDBs. Major corporations lobby the World Bank directly, through their own governments, or through the executive directors. Sam Loewenberg has documented the network of lobbying firms in Washington that represent corporate interests in the halls of the MDBs. [59] Observers of the influence of CSOs at the MDBs have given too little attention to corporate actors. Woods, for example, argues that "unregulated NGOs risk distorting the accountability" of the MDBs and other international organizations but makes no mention of the formidable influence of financial and corporate nonstate actors. [60]

The MDBs' governance and decisionmaking have changed in limited ways, largely under pressure by major shareholders and international NGO campaigns. Institutional changes encourage participation, transparency, and accountability and create space for change and innovation in the MDBs, but they also point to the limits of governance reforms. I next examine these changes and limitations.


Participation is a virtue much praised at both MDBs and practiced only occasionally--and in different fashions--at the two. During a period when both the MDBs and civil society organizations, including NGOs, are asserting new roles in policy formation, the MDBs' discourse and institutional forms have helped to open and close opportunities for participation. Participation has primarily meant involvement in implementing Bank-financed projects (World Bank) and carefully structured national and sectoral consultations (World Bank and IDB). Policy deliberations of the World Bank's board (but not the IDB's) have been opened on rare occasions to civil society comment.

NGO participation in implementing World Bank-financed projects is well documented and appears to be less extensive at the IDB. Critical, uninvited participation has been stronger at the World Bank and more tentative at the IDB, where Washington-based advocates often defer to Latin American NGO colleagues.

Both MDBs consult CSO extensively in sector policy planning. But sector planning impinges less directly on members' privileges and interests than does the country planning process, which both MDBs have guarded more carefully.

Country planning documents at both MDBs belong to the Bank, not the borrower. World Bank Country Assistance Strategy (CAS) documents, in fact, have been made available to the board only since 1994, and governments rarely make the finished CAS available to the public. As the case studies elsewhere in this special issue of Global Governance demonstrate, the record is uneven and governments retain a good deal of discretion.

Some poverty assessments, environmental action plans, and other preCAS research processes have been opened to civil society participation. But these consultations are not standard practice. And World Bank reviews of CASs during the 1990s found that poverty assessment findings were not being incorporated into the CASs and that fewer than half (ten of twenty-two) of those assessed involved "extensive and substantial consultations" with civil society.[61]

IDB Country Papers, unlike the World Bank CAS, have always been discussed with the board. They are available to but not developed jointly with the borrowing government and are shielded from the information disclosure and participation trends at the IDB. Some governments--notably El Salvador and Guatemala--have admitted civil society organizationsinto the country strategy process specifically for discussion of social investment funds.[62]

Private sector loans and guarantees are the most complex case because they involve corporations as borrowers in private sector projects negotiated with and guaranteed by borrowing governments. These projects are less readily opened to civil society consultations, as both banks debate how extensively environmental and social safeguards and regulations apply to private sector loans and guarantees. Social and environmental safeguards and participatory processes may sometimes make MDB loans less attractive to corporate borrowers.


Some member governments see measures to increase the transparency of MDBs as threatening the privilege of privacy that is central to their membership. Information disclosure policies adopted under pressure from the United States in 1993 (World Bank) and 1994 (IDB) began as proposals by environmental NGOs, intended to give civil society organizations new tools and rights in monitoring and influencing MDB lending.

The policies made more project and sectoral documents available to the public, but resistance by some staff and borrowers means that information is available more readily at headquarters than in the borrowing countries. NGOs are pressing for application of the disclosure rules to the IFC, whose transactions involve corporations that may not be enthusiastic about submitting their investments to public scrutiny.

Transparency demands by CSOs sometimes collide with those of member governments. Member governments have reacted strongly when consultations with NGOs have opened draft World Bank documents to the public before formal board reviews. The executive directors do not generally want to see earlier versions of such documents, as the board lacks the time and resources for several reviews of each new policy. But they object when policy proposals are debated publicly before they have access to them.

Further, say some directors, management's submissions to the board do not allow them adequate time for review and consideration. The increasing number and complexity of projects at both MDBs place enormous demands on the boards, as does the expansion of policy to cover an increasing range of financial, social, environmental, and macroeconomic issues.

Accountability: Of Whom, to Whom?

Four forms of accountability are now at issue in debates over MDB operations. These are MDBs' accountability to their members, especially borrowing members; MDBs' accountability to civil society organizations affected by its operations; borrowing governments' accountability to the MDBs' policy conditions; and governments' accountability to civil societies.

These forms of accountability are being asserted, institutionalized, and resisted in the establishment, implementation, and revision (in the World Bank) of investigative mechanisms. The inspection panels are the most visible mechanisms of MDB accountability to civil societies in the borrowing countries. [63] Both panels were proposed to facilitate such accountability by providing for review of appeals by groups of individuals directly affected by a project.

Proponents envisioned inspection panels that enforced accountability by the MDBs to affected groups and individuals. Their hopes for an authoritative appeals panel have been almost completely frustrated at the IDB, where the independent investigation mechanism was granted virtually no independence from management. Created under U.S. pressure during negotiation of the IDB's eighth replenishment, the panel has been little publicized in the region and suffers from "obscurity and a lack of independence from IDB contro1." [64] Only one claim has been filed with the IDB panel.

Borrowing members of the IDB have generally been able to exercise their influence on the board to shape the new policies and institutions at their creation. In contrast, the World Bank's borrowing members were much less able to influence the initial powers and mandates of the Independent Inspection Panel. The World Bank's Independent Inspection Panel, with a permanent staff and secretariat, presents a stronger challenge to the exclusive rights of the board to approve, disapprove, and modify loans. World Bank borrowers have therefore asserted their (limited) influence differently, fighting to limit the scope of binding policy, to restrict the panel's investigative powers in individual cases, and, most recently, to revise the mandate that prevents the panel from making findings that imply culpability by the borrowing government.

Both MDB boards have worked to limit the panel's authority in daily operations by treating them as advisory bodies. IDB management called the panel report on a loan to Argentina for the Yacyreta dam an "important input which Bank staff look forward to discussing with [the project implementing authority] and authorities from the two governments," and management offered to discuss the panel's findings with the board. [65]

Action by the World Bank's management and board may also diminish the panel's authority by limiting the range of World Bank policy that is deemed binding. The body of policy (operational directives) against which complaints can be lodged is being converted to a shorter list of authoritative policies. Much of the content of the voluminous operational directives is being converted to nonmandatory "best practice" guidance for staff. NGOs express concern that important topics are being excluded from the new body of policy, including former operational directives such as poverty reduction, gender, energy efficiency, and social aspects of development. [66]

The World Bank's borrowing country executive directors have gone beyond creating obstacles to individual investigations by the panel. In 1998 and early 1999, several major borrowers supported a more fundamental set of revisions that would restrict the panel's investigative powers and narrow the set of potential complainants. (Ironically, board action on this challenge was delayed for two months while management requested a period of public comment, including by civil society organizations. [67])

In April 1999, the World Bank board approved a package of changes that limit the panel's investigative powers in some respects. [68] In particular, the new plan precludes the panel from commenting on government responsibility for problems under review, forcing a stricter focus on the World Bank's accountability to its policy standards. The revisions also strengthen the panel's independence in one respect: proposed investigations that meet the technical requirements will not, under a "gentleman's agreement," be challenged on other grounds. An appeal submitted to the panel in May 1999 against the Land Reform and Poverty Alleviation Pilot Project in Brazil will test the new arrangements.

Taken together, the patterns of resistance and debate over the inspection panels illustrate contrasts between the IDB and the World Bank. IDB borrowing governments showed themselves able to substantially influence the organization's decisions. The voting majority of borrowing members and the IDB's consensus-building style are important to maintaining the principles of sovereignty and collegiality. In addition, the IDB has been less subject to intense NGO pressure for information disclosure and accountability. The World Bank, however, maintains a degree of autonomy from its borrowing membership. It has traditionally described its relationship to borrowers using the language of the market: the members as clients. The language of partnerships, now in fashion at the World Bank, also implies a certain distance, with member states the principal among several key partnerships that the Bank maintains. [69] Indeed, the World Bank holds its borrowers accountable to an increasingly broad range of economic, environmenta l, and now institutional requirements and procedures. Governance standards are the most recent set of such conditions. With limited formal powers, the World Bank's borrowing members have targeted decisions about daily operations that they can influence through persistent resistance.

The MDBs, the New Agenda, and Influence in the Region

The two MDBs' experiences with governance and civil society suggest some conclusions and further questions about governance, the influence of CSOs at the MDBs, and the governance of the MDBs themselves. I suggest some issues and hypotheses.

The IDB and World Bank maintain organizational identities (as regional facilitator and apolitical lender, respectively) that facilitate their influence in the region. The IDB's posture as regional facilitator allows it to influence regional deliberations and wins it legitimacy as a regional partner. The World Bank's apolitical posture enables it to apply loan conditions that would be unacceptably intrusive if not justified on nonpolitical grounds. Its expanding governance agenda stretches the bounds of what can be justified as essential to economic performance.

Borrowers may prefer to work with the IDB, whose governance agenda is more subject to regional control. But the World Bank will likely maintain its involvement by cofinancing project loans; and it can broaden the boundaries of governance assistance through its own lending, particularly in smaller, poorer borrowers that are less able to negotiate the terms of their borrowing. Its direct influence on major borrowers may have declined, but it continues to set the direction for institutional change at other MDBs.

In much of this essay, I have focused on significant differences between the agendas (summarized in Table 1) and the styles (summarized in Table 2) of the two MDBs. Whereas the IDB continues to stress the primacy of its relationship with the region's governments, the World Bank's emerging partnership framework suggests multiple accountabilities to civil society and private sector partners and to borrowing governments.

But there are also important conclusions that are common to the two MDBs' experience. Observers' attention to civil society, participation, and NGOs at the two MDBs has far exceeded the actual influence of the new policies. NGOs have won policy concessions in environmental and social policy, but the major trends in MDB lending--governance, private sector, adjustment--are either untouched by NGO pressure or actually move MDB activity in directions that NGOs oppose and have difficulty influencing.

CSOs' campaigns for change at the MDBs lost momentum in the mid-1990s. Wolfensohn's arrival and the election in 1994 of a Republican majority, generally opposed to multilateral aid programs in both houses of the U.S. Congress, led some NGOs to soften their public criticism to avoid supporting political attacks on the aid programs. NGOs have been forced to address the conversion of detailed operational directives to principles of policy and best practice and the application of social and environmental safeguards to the MDBs' private sector affiliates (the IFC and the Multilateral Investment Fund of the 1DB). At the same time, many NGOs are shifting away from strictly Washington-oriented advocacy to more Southern NGO-led, country-focused strategies. Although this strategic shift may broaden and strengthen CSO input in the long term, in the short term it lessens the pressure on World Bank headquarters.

The MDBs' decentralization of authority (including the World Bank's relocation of country directors in-country) will have implications for CSOs' access and influence. NGOs in Washington find access to some responsible staff more difficult. If authoritative staff is not accessible to CSOs in-country, decentralization will result in a net loss of access to decisionmakers by CSOs.

Member states and NGO advocates have often been at odds over institutional and policy reform agendas at the MDBs. The contested issues--civil society participation, national policy processes, information disclosure, accountability mechanisms, and social and environmental reforms--have been the sites of some NGO policy victories, particularly at the World Bank. All of these occur, however, in the context of institutional arrangements that give the corporate private sector greater access and influence over decisionmaking in the MDBs.

These NGO policy victories have contributed to the broadening of the MDBs' agendas, as new responsibilities in social, environmental, and governance issues are added to their roles in structural adjustment policy and debt management. In the contest between member governments and NGO advocates, MDB management thus appears to be the primary winner, particularly at the World Bank. MDB management has been able to demand greater accountability by borrowing governments, to a broader policy agenda. The IDB has maintained its strong regional role, although both banks have accepted limited forms of accountability to CSOs affected by their programs, largely structured on terms that the MDBs themselves manage.

Governance and civil society principles have penetrated some decisionmaking processes at the MDBs in some formal institutional changes but with limitations that are the result of successful resistance at either the institutional level (IDB) or the daily operational level (World Bank). As member governments, MDB management, and civil societies continue to contest the implementation of governance reforms at the MDBs, the results are being worked out largely in decisions taken at the daily operational level, decisions that in turn shape the governance of the societies the MDBs were created to assist.


Paul Nelson is assistant professor in the Graduate School of Public and International Affairs at the University of Pittsburgh. He was previously a policy analyst for several U.S.-based NGOs and guest research scholar at the University of Maryland's Program on the Global Future.

(1.) Diana Tussie, ed., El BID, el Banco Mundial y la sociedad civil: Nuevas formas de financiamiento internacional (Buenos Aires: FLACSO, 1997).

(2.) Robert Cox and Harold Jacobson develop a typology of decisions in international organizations, from which I have drawn the distinction between formal, organizational decisions and decisions made in the course of daily operations. See Cox and Jacobson, eds., The Anatomy of Influence: Decisionmaking in international Organizations (New Haven: Yale University Press, 1973).

(3.) IDB, "IDB Disbursements to Latin America Reach New High in 1997," news release NR-309/97, 30 December 1997.

(4.) IDB, "Report on the Eighth General Increase in the Resources of the Inter-American Development Bank" (Washington, D.C.: Inter-American Development Bank, 1994).

(5.) IDB, Modernization of the State and Strengthening of Civil Society (Washington, D.C.: Inter-American Development Bank, Strategic Planning and Policy Department, 1997).

(6.) Ibid., p. 2.

(7.) Ibid.

(8.) Ibid., p. 10.

(9.) Ibid., p. 16.

(10.) Ibid., p. 15.

(11.) The Latin American and Caribbean Commission on Development and Environment, "Our Common Agenda for the Americas," 1994, reprinted in Robin Rosenberg and Steve Stein, eds., Advancing the Miami Process: Civil Society and the Summit of the Americas (Miami: North-South Center, 1995), pp. 73-110.

(12.) Ibid., p. 91.

(13.) Ibid., pp. 91-94.

(14.) See "Gestures Against Reform," The Economist (30 November 1996): 9-21.

(15.) IDB, Modernization of the State and Strengthening of Civil Society, p. 1.

(16.) Ibid., p. 17.

(17.) Diana Tussie credits this special relationship with the IDB's successful sectoral policy lending in the 1980s. See Tussie, The Inter-American Development Bank (Boulder: Lynne Rienner/North South Institute, 1995).

(18.) IDB, "Summary Report of the Conference on Strengthening Civil Society" (Washington, D.C.: Inter-American Development Bank, 12-14 September 1994).

(19.) IDB, "Strengthening Country Offices" (Washington, D.C.: Inter-American Development Bank, Task Force on Country Offices, February 1996), p. 2.

(20.) IDB, Annual Report 1996 (Washington, D.C.: Inter-American Development Bank, 1996).

(21.) Synergos Institute, "How Governments and Multi-Lateral Donors Can Form Large-Scale Partnerships with Civil Society Organizations: Reflections from Three Latin American Countries," Synergos Institute Working Paper, New York, July 1996, p. 5.

(22.) Ibid., p. 3.

(23.) Ibid., p. 4.

(24.) Ibid., p. 9.

(25.) IDB, Annual Report 1996, pp. 23-24.

(26.) The working gro up also includes Church World Service/Lutheran World Relief, the Development GAP, InterAction, the Center for Democratic Education, and the International Confederation of Free Trade Unions (ICFTU).

(27.) Nancy Birdsall, presentation to NGO Working Group Educational Forum, 12 February 1998, in notes on file with the author.

(28.) Kari Hammerschlag, Bank Information Center, and Bruce Rich, Environmental Defense Fund, letter to Nancy Birdsall, executive vice-president of InterAmerican Development Bank, 15 December 1997, on file with the author.

(29.) World Bank, Governance and Development (Washington, D.C.: World Bank, 1992).

(30.) Paul J. Nelson, "Internationalising Economic and Environmental Policy: Transnational NGO Networks and the World Bank's Expanding Influence," Millennium 25, no. 3 (1996): 605-633.

(31.) World Bank, The State in a Changing World: World Development Report 997 (New York: Oxford University Press, 1997), p. 13.

(32.) World Bank, Governance and Development.

(33.) World Bank, "Effective Implementation: Key to Development Impact" (Washington, D.C.: World Bank, Portfolio Management Task Force, 1992).

(34.) Nuket Kardam, "Development Approaches and the Role of Policy Advocacy: The Case of the World Bank," World Development 21, no. 11 (1993): 1773-1786; Rita Bhatia, "NGO Advocacy, Policy Reform and the World Bank" (master's thesis, Institute of Development Studies, University of Sussex, September 1996).

(35.) See Moises Naim, "Latin America: The Second Stage of Reform," Journal of Democracy 5, no. 4 (October 1994): 32-48.

(36.) Jo Marie Griesgraber, "Southern Governments and Northern NGOs: Evolving Relationships Around World Bank Issues," paper presented at the annual meeting of the American Political Science Association, Washington, D.C., 31 August 1997.

(37.) World Bank, The State in a Changing World.

(38.) Shahid Javed Burki and Guillermo E. Perry, The Long March: A Reform Agenda for Latin America and the Caribbean in the Next Decade (Washington, D.C.: World Bank, 1997).

(39.) Ibid., p. 55.

(40.) Shahid Javed Burki and Sebastian Edwards, Dismantling the Populist State: The Unfinished Revolution in Latin America and the Caribbean (Washington, D.C.: World Bank, 1996).

(41.) Ibid., p. 2.

(42.) World Bank, Governance: The World Bank's Experience (Washington, D.C.: World Bank, 1994), p. 52.

(43.) Ibid.

(44.) See, for example, ibid., pp. 53-54.

(45.) Maria Dakolias, "The Judicial Sector in Latin America and the Caribbean: Elements of Reform," World Bank Technical Paper No. 319 (Washington, D.C.: World Bank, 1996), pp. 3-4.

(46.) Lawyers Committee on Human Rights and the Venezuelan Program for Human Rights Education and Action, Halfway to Reform: The World Bank and the Venezuelan Justice System, appendix A (New York: Lawyers Committee, 1996), p. 132.

(47.) Online at, 15 June 1999.

(48.) World Bank, Annual Report 1997 (Washington D.C.: World Bank, 1997), p. 130.

(49.) World Bank, Governance, p. 1.

(50.) Reported in Michelle Miller-Adams, The World Bank: New Agendas in a Changing World (London: Routledge, 1999), p. 278.

(51.) World Bank, Cooperation with NGOs: 1997 Progress Report (Washington, D.C.: World Bank, 1998).

(52.) Jonathan Cahn, "Challenging the New Imperial Authority: The World Bank and the Democratization of Development," Harvard Human Rights Journal 6 (spring 1993): 159-193.

(53.) Burki and Perry, The Long March, p. viii.

(54.) Online at, 15 June 1999.

(55.) Paul Nelson, "Transparencia, fiscalizacion y participacion: La implementacion de los nuevos mandatos en el Banco Mundial y el Banco Interamericano de Desarrollo," in Tussie, El BID, el Banco Mundial y la sociedad civil, pp. 21-62.

(56.) Allison Van Rooy, "The Civil Society Agenda: Switching Gears in the Post Cold War World," paper presented at the annual meeting of the International Studies Association, Toronto, 18-22 March 1997.

(57.) John Clark, presentation to the InterAction Working Group on the World Bank, 5 June 1998, in notes on file with the author.

(58.) Ngaire Woods, "Good Governance in International Organizations," Global Governance 5, no. 1 (January-March 1999): 39-61.

(59.) Sam Loewenberg, "Businesses Find Ways to Influence World Bank Projects," Legal Times, 22 February 1999, p. 1.

(60.) Woods, "Good Governance in International Organizations," p. 45.

(61.) World Bank, "Civil Society Participation in Country Assistance Strategy, FY-97-98," Washington, D.C., p. 4.

(62.) John Ruthrauff, "Influencing Consultative Group Meetings of the World Bank: A Case Study" (Silver Spring, Md.: Center for Democratic Education, 1996).

(63.) The IDB does not maintain a standing panel but has a roster of experts who can be assembled to form a panel at the president's discretion. For convenience, I use the term inspection panel for both MDBs.

(64.) Center for International Environmental Law, "The IBD Independent Inspection Mechanism," available online at, 15 June 1999.

(65.) "Management's Comments on the Review Panel's Report Yacyreta Hydroelectric Project," no date, online at the IDB website at, 5 May 1999.

(66.) The NGO concern is discussed in World Bank, "World Bank Operational Policies: Lessons of Experience and Future Directions," Discussion Draft (Washington, D.C.: World Bank Operations Policy and Strategy, 19 November 1997), p. 15.

(67.) Memorandum from the secretary of the board, "Report of the Inspection Panel Working Group," 3 February 1999, available online at

(68.) "Conclusions of the World Bank's Second Review of the Independent Inspection Panel," available online at

(69.) World Bank, "Partnership for Development: Proposed Actions for the World Bank," Washington, D.C., 20 May 1998.
 Inter-American Development Bank and
 World Bank Governance Agendas
Item Inter-American Development Bank
Public sector Modernization; associated with
 management privatization and fiscal reform
Legislative Training and information systems,
 branch legislative information system
 for Mercosur
Justice system Judicial reform, administration,
 training; conflict resolution,
 prison reform, antiviolence
Legal Cosponsor of 1994 study of
 framework/ South American regulatory
 NGOs frameworks for civil society
Human rights Building of consensus for full
 respect of human rights
Military No mention
Civic Deepening of national consensus
 education on democracy, markets
Participation In Bank-financed projects, strategy
 papers; little in-country policy
Transparency Information disclosure policy
Accountability Investigative mechanism (1994);
 one request for inspection
Corruption Task force to limit corruption in
 Bank-financed activities
 (established 1997)
Item World Bank
Public sector Continuation of public sector
 management management lending
Legislative Information systems, e.g., the
 branch Chilean Library of Congress
Justice system Judicial reform, training,
Legal Handbook: guidelines for
 framework/ NGO law
Human rights Economic and social rights:
 poverty reduction, human
 resource development
Military In public expenditure reviews
Civic No mention
Participation In projects and certain research
 and policy planning processes;
 some Bank-wide policy
Transparency Information disclosure policy
Accountability Inspection Panel since 1993;
 eleven requests for inspections
 (four in region)
Corruption With Transparency
 International; Anti-Corruption
 Knowledge Center
 Regional Identity, Civil Society, and
 Governance Programs at the
 Inter-American Development Bank and
 World Bank
Characteristic Inter-American Development Bank
Posture toward Participant in regional consensus
 regional members
Stake in region High
Governance programs High-profile
Civil society/
 NGO programs Low-profile
Civil society
 confrontation Low
Transparency: Uneven in country offices;
 information disclosure safeguards members' privileges
 MDB to civil society Weak
 MDB to borrowing Strong
 member governments
 Borrowing member Weak
 governments to
Characteristic World Bank
Posture toward Relative autonomy;
 regional members banker-client;
Stake in region Low
Governance programs High-profile
Civil society/
 NGO programs High-profile
Civil society
 confrontation High
Transparency: More thorough; early
 information disclosure release of documents
 sometimes controversial

 MDB to civil society Slightly stronger
 MDB to borrowing Relative autonomy
 member governments
 Borrowing member Expanding
 governments to
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Author:Nelson, Paul
Publication:Global Governance
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Date:Oct 1, 2000
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