Brace yourself for more structural adjustment

"The Middle East and North Africa region has become the fastest-growing area for investments from the World Bank's private sector arm, the International Finance Corporation (IFC), which surpassed one billion dollars for the first time last year, according to the Bank Information Centre, a Washington-based research group on international public lenders.

Egypt, the most populous Arab country, received most of the loans (283 million dollars) over the past five years, followed by Oman, Algeria and Iraq.

The report's authors say that the IFC is also taking advantage of new investment opportunities created by accelerated trade liberalisation and privatisation reforms in the region, which are often tied to the World Bank and International Monetary Fund (IMF) programmes.

Of all loans from multilateral financial institutions, including the African Development Bank, nearly a quarter again went to Egypt, which has implemented a rigorous World Bank-sponsored liberalisation programme.

Lending to Iraq is also forecast to grow in coming years. The World Bank has approved emergency loans worth around 400 million dollars to the country through its Iraq Trust Fund, while the IFC has committed over 100 million dollars in private sector operations.

The study notes that in 2001, the World Bank provided 507 million dollars to MENA -- only 2.9 percent of the total Bank lending that year. But in 2006, it gave out 1.7 billion dollars, more than half which went for finance and energy projects after several years of relatively minimal allocations to these sectors.

Lending projects in the water and sanitation, health and agricultural sectors dropped off almost entirely, it says.

In the last five years, Egypt has borrowed more from the World Bank than any other country, receiving over 1.2 billion dollars, followed closely by Iran, which has received 1.1 billion dollars from the Bank over the same period.

The study found that the Bank went into the region with the same ideology it imposes elsewhere in developing nations. It says its focus has been on instituting "comprehensive structural reform" to facilitate greater liberalisation measures such as the elimination of trade barriers to open up the region to increased private investment and economic integration. The authors of the report cite many of the Bank's own studies, which have revealed that income inequality in MENA is on the rise, despite increased economic growth and investment. "

The jury is still out about the significance of increased IFI investment in MENA for the region's people. The impacts of the influx of public financing on poverty, inequality, unemployment and the environment in MENA remain to be seen," the authors of the report said.

"Investment is not an unambiguous good, as it is often portrayed to be, nor is investment itself tantamount to development"."

In a nutshell: There out to get Iraq in financial chains, if it has a slight chance of ever becoming a country again, privatization will boom in the region, neo-lib policies will be fostered, trade will be unbridled, the rich will become richer, and they've already got Iran by the balls.

The corrupt telling the corrupted...

"The ratings of the United States and Italy on corruption have significantly worsened since 1998, and Chile, a middle-income developing country, now performs as well on this measure as the United States, according to the report. In fact, a dozen emerging economies, including Chile, Botswana, Uruguay, Costa Rica, Latvia and Lithuania, scored higher on the rule of law and controlling corruption than some industrialized countries, like Italy and Greece.

"It begins to challenge these long-held popular notions that the rich world has reached nirvana in governance," said Daniel Kaufmann, an author of the report who heads global programs at the World Bank Institute, the bank's knowledge-sharing and training arm.

After Paul Wolfowitz, then president of the World Bank, became mired in scandal this year over charges of favoritism, bank staff had to fight for the institution's own credibility in judging governance in the developing countries it serves.

Kaufmann said countries rightly asked the bank: "What right do you have of rating the world when you first have to rate yourselves? It has to start at home.""(thanks Yasmine)

Honni soit qui Mali pense

"The reason? Mali has refused to privatize its cotton industry, which is integral to the country’s social and economic well-being. $72 million worth of aid is being withheld from the country (in which 90% of people live in poverty) for this reason. In 2004, the Bank withheld $50 million because of the Malian government’s refusal to end price support systems for cotton farmers, designed to mitigate the impacts of price decline fueled in no small part by rich country subsidies of their own industries (see below). When Bamako finally caved in and agreed to expose its poor farmers to the unjust international system, prices immediately dropped by 20% and poverty increased by 4.6%.(15)"

Extensive, well researched article.

DeBunking the Bank

"Goldman had some reason to doubt these promises before he began his principal case study, the Nam Theun 2 Dam Project on the Mekong River in Laos. In the Thar desert of northwest India, the World Bank had invested in a massive irrigation canal system to pour Himalayan water into a harsh arid environment. Wealthy landowners turned land along the main arteries of the canals into export-producing farms. But along the minor arteries water disappeared. Systematic theft of cement left canals too porous to deliver water. In other places channels were sand-clogged, and adjacent land was waterlogged and salinated. Driven into debt, poor farmers were forced off their land and into part-time labor, indentured servanthood, or sharecropping."

Case by case painstaking dissection of many Bank projects. Essential.

Keep the people in bondage, but free the trade

"Implicit in this is a transition—from an old model of economic organization and activity to
a new one. The old model—driven by the public sector, supported by oil, aid, and workers’
remittances—cannot any longer generate faster growth or jobs, as the performance of the
past two decades attests. A new model, which is much more reliant on trade and private
investment, promises to support faster growth and jobs needed in the region.

Many countries are seeking to strengthen their trade partnerships with Europe, their largest
trading partner, through the Euro-Med trade agreements, while intraregional trade is being
promoted through the Pan Arab Free Trade Area (PAFTA) and the newly established Gulf
Cooperation Council (GCC) customs union. Several other smaller regional trade groupings
also have been established. A number of countries are seeking membership in the World
Trade Organization (WTO). Jordan and the United States have signed a free trade
agreement, and more such agreements may be forthcoming.
Yet, the results on the ground remain disappointing. The 1990s were marked by stagnant
or declining trade and private investment—MENA was the only region in the world to
experience a reversal. There is strong pressure to produce better results."

Interesting document in World Bank promotes a more radical approach to trade liberalization and a fuller adoption of the neo-lib package for the Middle East.

The Bank's recipe book

"But pundits and policy makers should reflect on the fact that many nations, notably in the Middle East and in Latin America, have failed to make this vital transition. “There are three main elements of the new strategy,” Dr. Matin noted. “The first is moving from diversified to more specialized structures. The second is moving from a strategy of accumulation to a strategy of innovation which means working smarter. Third, is the need to move from an emphasis on basic skills to advanced skills, thereby producing workers that can produce innovative products and processes.”"

World Bank: We said Free Trade, not Free People!

"Through the violent occupation of Iraq, the US is laying the foundations to further open the economy of the Middle East for their corporate interests. Countries once protected by oil revenues are lining up to sign bilateral agreements leading to a Middle East Free Trade Agreement. MEFTA would impose free market policies that have enslaved other regions of the global south to global capital. In Palestine, the World Bank has played a key role in facilitating the cooperation of global capital and occupation.

Central to the vision of the World Bank for a thriving and successful Palestinian “state” is the development of an export-orientated economy in which Palestinian dispossessed farmers are exploited as cheap labor and dominated by markets and free trade. Israeli and World Bank interests merge to destroy local forms of trade, sustainable patterns of agricultural production, and existing social structures.

The industrial zones are designed to serve the needs of the industry markets of Israel, whether by doing the most environmentally destructive production in Palestinian areas or by providing cheap labor. Additionally these zones would benefit the Israeli Occupation abroad where goods “Made in Palestine” have more favorable trade conditions in international markets.

While espousing the politics of free markets and free trade, the World Bank is not interested in the creation of a free people. Quite the opposite—its interests are best served by keeping Palestinians in economic enslavement. "

Please please read this article. And forward it to Lebanese minister of economy and trade, Sami Haddad, also known as Haddadamus (for his prophetic wisdom).