Notes of meeting, Washington DC, September 22, 2011

Sponsors:International Monetary Fund, World Bank Group

Speakers: Christine Lagarde (Managing Director, IMF), Robert Zoellick (President,WBG), Laila Iskandar (Managing Director, Community and Institutional Development Group, Egypt), Milwida M. Guevara (President, Synergia Foundation, Philippines), CHAIR: Ingrid Srinath (Secretary General, Civicus)

This townhall is for CSO representatives accredited to the Annual Meetings. Mess. Iskandar and Guevara will make initial remarks on Fund and Bank policies, to be followed by comments from Ms.Lagarde, and Mr.Zoellick. This will be followed by a general discussion on issues of concern to CSO representatives.

Christine Lagarde

• Critical juncture – leaders will have to act boldly to address looming issues in advanced economies
• Need to work together – low middle and high income countries – advanced economies can learn from others who have been through crises
• Latvia took firm measures – IMF programme will be completed by end of year. Prime Minister said leadership from government plus dialogue with civil society, particularly union leaders was critical.
• Need to have multifaceted analysis and take into account the social dimension of policies.

Laila Iskandar – International recycling NGO

• Growth with inequality – data on MDGs masks inequalities. Unemployment has risen, hunger is growing etc
• Growth with inequalities is untenable – demonstrated by revolutions in Arab countries
• Need to explore new development paradigms that focus on distributional aspects of growth and prosperity for all not just top 20 per cent.
• Current path directly impoverishes women, and is environmentally unsustainable.
• Energy projects at the Bank have been problematic – fossil fuel based, large infrastructure not Energy access for the poor. New renewable energy services can deliver access for the poor.
• Can the Bank change as fast as young societies are changing?
• Invite the Bank and the IMF to open up policy spaces for diverse activities.
• Safeguards – are concerned that they may be watered down – want to expand them to cover issues not covered including rights of disabled people.
• Concerned about Programme For Results – can Bank commit that all safeguards will apply
• Mega-projects still fraught with problems.
• Need new learning among Bank experts and technical staff.

Milwida Guevera

• Fund has broken its long tradition of secrecy and rigidity
• We share the same vision of inclusive growth, better governance and home grown reforms
• Frustrations remain. First is the level and quality of interaction with civil society – reforms are worked out with governments with ad hoc and limited consultation with civil society – this is worse when the governments are corrupt. We hope the Fund can use its influence to push governments to be more transparent.
• Second is the focus on macroeconomic numbers – impacts on welfare and distribution may be bad. This can weaken the position of governments.
• Experience has shown that reforms are better if they are the products of extensive consultation and community involvement
• Only when communities participate that structural reforms can be implemented.
• Economic reforms are also about income for people and better public services.
• Isn’t the use of local expertise more relevant than foreign advice – better to scale up best practice in country than hire external experts.
• Appreciate the initial steps the Fund has taken towards greater transparency.

Christine Lagarde

• Hope to improve the relationship with civil society and also the programmes and policies to help economies
• IMF is a multinational, multi-background group of people. Don’t disagree with anything that you’ve been said.
• I will continue the transparency policy that is in place.
• Take your point about dealing with corrupt or incompetent governments – agree this should be high on the agenda.
• Predecessors have made sure social dimension is included in the design of policies – I will continue this.
• Development has to be inclusive and has to benefit the young population for it to be sustained.

Robert Zoellick

• Both institutions have 187 governments as shareholders – we have to work with that as a framework. Means we face constraints
• Idea that we should work with “non-profit-making private sector” CSOs was not met with universal approval by the board
• The more you can be transparent and put feedback into the system, the better the job.
• We’re trying to multiply the opportunities to interact with the Bank. CIFs – we suggested that there be civil society members on those boards. There are CSOs on the board of GFATM.
• When we provide funding and support – conscious of issues of control and influence. Previous speech suggested a civil society support facility; like the IFC or IBRD. Plan to work with foundations and civil society in the aftermath of the annual meetings.
• We’re pushing openness and transparency. Open data initiative was launched. We all learn from our mistakes – the more open and transparent you are, the quicker you get feedback.
• PWYF ranked the World Bank number one of all multilaterals on transparency. Only multilateral with a negative list freedom of information list.
• Safeguards – agree that they have been by and large a plus. Some developing countries are concerned that it adds costs. We don’t want to add costs – want to make the safeguards work. Will make the process open and transparent. Now we’re consolidating the guidance for staff – we’ll make this public and will consult with CSOs.
• Fossil fuels – most difficulty I run into is from developing countries. Water pumps in Vietnam were the best liberation for women – came from rural electricity. Energy efficiency is a win win.
• But there are some groups that don’t want anyone to build dams – going to be hard to provide electricity for Africa without dams.
• US generate 50% of electricity from coal – In Kosovo it’s the only source available. Don’t want civil society demands to add costs to developing countries.
• WDR on gender – there are policies to deal with this, we’re working to find win win solutions. In Ethiopia, we created lines for two names on property titles – so suddenly women’s names go on the deeds, they get title, access to credit etc.

CSO questions

• IEO suggested expanding recruitment process to include more women, minorities. What can be done to reform organisational culture?
• FTT – useful IMF research has done on implementing them. What role will the IMF play in the future? Will it help advice governments on how to implement FTTs?
• Will the IMF consider youth as a macroeconomic issues.
• When will IMF / World Bank require from Basle regulators to openly and explicitly define the purpose of banks to see if we all agree

Lagarde

• Pleasantly surprised by the number of women at the IMF, including in senior positions (though not at the board), and that organisation had commitments to percentages of women at various layers. In negotiating teams, some governments have asked for fewer or no women on the teams – I will pick up the phone and challenge people who do this.
• FTT – previous work found that FTT was not necessarily best avenue for win-win solution; FAT would be better. But once you go into FTT on a per transaction basis, you induce a slowing down of the system, which is probably a good thing but you are incapable of encompassing the entire system, you will induce shadow systems that you are unable to capture.
• Population is a strong component in any analysis we conduct. What we are learning from MENA is that the young population is a driving force – the producers of wealth and the creators of growth.
• Vickers commission report is helping to build debate on what are banks for, what are guarantees are for. The most critical mission for the banks is to finance the economy.

CSO questions

• Why are you still determined to build new coal power plant in Kosovo without undertaking a study of alternative resources or a study of energy losses and efficiency?
• Safeguards – what is the upcoming policy on disability?
• Jobless growth – have to focus on this. Need to reform indicators so that when growth figures published, they take in jobs.

Lagarde

• Obvious that growth with jobs is needed. Will look into what can be done on statistics. Stiglitz and others did good work on how we measure growth – conclusions of report should be picked up in the way we report growth.
• Took note of idea about setting up advisory council including civil society representatives.

Zoellick

• Bank regulators – some out of the world of central banks – who will be the last bastion to fall to openness and transparency. We have suggested to FSB that they need an outreach mechanism.
• Share strong sentiments on disability. I try to push this in our programmes and policies. Can respond offline on different groups we’ve tried to help. I don’t know the answer on safeguards. Could be that they’ve tended to have a more limited focus on environmental topics and other social topics.
• Jobless growth one of the hot topics. Will launch the next WDR on jobs. Last time there was a WDR on jobs it looked at globalisation and jobs through traditional labour market questions. Now we’re looking at jobs in terms of fulfilment, productivity, social cohesion – lens will be revealing. Perspective may shift the policy approach.
• WDR on conflict – there are ways of creating quick jobs without undermining sustainability in aftermath of conflict
• Kosovo – created expert panel to ask exactly those questions and review proposal, against screening criteria. Proposal is to shut down 40 year old power plant and clean up another plus build a new one. We’ve asked a lot of questions about alternatives. Escom – if South Africa doesn’t have electricity, people won’t have jobs. We also developed energy efficiency programmes and cheap energy for the poor, and we looked at alternative energy investments. Hard choice when countries ask us – do we get involved or let the situation proceed without us. South Africa’s a democracy.
• In Tunisia – having a gender event in October.
• WBG – 51% of the senior officers are women. But at the next level down it’s only 35%. When I arrived targets were less than 50%- I said that was ridiculous. I appoint the senior people, and am trying to send a message. Have to be careful about implicit biases. You have to keep pushing and be resolute. Firm belief that this is an important part of executive accountability.
• Now have a rule that budget support countries have to publish budgets (post conflict states within 12 months)
• Personally believe a participatory process and debate leads to better to results.

CSO questions

• Access to information policies working quite well for investment projects, but not for DPLs. ILs we can see the safeguard related documents in advance. But DPLs only get the documents once they’re approved – worried this will be the same for P4R.
• Is there a time frame for the CSO financing facility will come out.
• Worried about how useful data initiatives are – communication issue.
• Engagement with microfinance institutions with local offices would be fruitful.

Zoellick

• Offices should be accessible – if they’re not, let us know
• Parliamentary Network on the World Bank is a mechanism that’s important.
• Tunisia – aiming to help the government communicate with the public.
• At data level are getting good feedback on how to make it more accessible, but would like to talk more on how to make information more accessible.
• On CSO instrument – am on a little thin ice. May take some time – be patient. This is a seed with great potential.
• P4R – we’re in a consultation period about this. Inclined to start it off with some pilots. Aim is to empower developing countries – to pay them if they deliver results. How can we make it easier for developing countries to make their own decisions?
• Very possible that ILs have broader consultation as it develops loan, DPLs may move faster. Can follow up on this.

Caroline Anstey, World Bank

• More a question about how we do budget support. Policy says all information is released when decision goes to board. Access to information treats all programmes in the same way.