IMF and World Bank are losing clout in developing countries [View all]
IMF and World Bank are losing clout in developing countries
Developing nations are organising within the IMF and World Bank to counter their neoliberal policies
The Guardian, Thursday 30 May 2013
There is a battle going on within and outside the World Bank right now over its flagship Doing Business report and index. This may not appear to be exactly a household issue, but the fight is a very significant one for a number of reasons.
The index ranks countries according to the "ease of doing business", including such things as starting a business, enforcement of contracts, paying taxes and other indicators. It has been under attack for years because it has a built-in bias against many regulations that people who care about the progress of humanity might see as important: employment protections; necessary taxation; health, safety and environmental regulation; and of course most state-led development policies.
As noted recently, the fact that the Bank gives higher marks for "fewer restrictions on permits for construction" means it ignores the safety and environmental concerns that can contribute to disasters such as last month's Bangladesh factory collapse.
There is evidence that countries have deregulated in harmful ways in order to get a better ranking. And despite years of controversy and a 2008 internal evaluation critical of the index, the Bank still uses it as a criterion for lending to low-income countries.