October 11, 2017
- Jim Yong Kim (President, World Bank Group)
- Christine Lagarde (Managin Director, International Monetary Fund)
- Abdel-Rahman El Mahdi (Moderator)
For the full video of the event, please click here.
Q: What role is there for civil society in the Bank’s pursuit?
Kim: There is no question that civil society has shaped the World Bank Group immensely. We would not have the new Environmental and Social Framework (ESF), the safeguards, without civil society organisations as their support and criticism are important. We have $75 million for International Development Association (IDA), in part due to the work that many CSOs have done to support this replenishment. It’s impacted our work on Uzbekistan, for example, where we have used Human Rights Watch research to pressure the government on forced labour. Citizen engagement is also recognised to be central to development, as demonstrated in Romania and Kenya. We’re still seeking feedback on how we can improve our work. This is reflected in the new Human Capital project – where we’re looking at key correlations between health, education and economic performance. Seeking to develop a ranking to place Bank on investments on human capital. Relations can, of course, be contentious.
Q: What is the view of the IMF on emerging issues?
Lagarde: We are happy to hear the use of ’emerging issues’ as it is now accepted that these things are indeed core by stakeholders. Women have gone from being a non-core to an ’emerging’ issue. We assess each country individually in order to evaluate whether the issues they face are macro-critical and we will hold three workshops with CSOs in the near future. Ghana, for example, has had extensive consultations with CSOs whilst Ukraine has also reaped significant benefits from cooperating with CSOs. In Ukraine, strong CSO input has also contributed to the establishment of the Anti-corruption Commission. We try to incorporate ’emerging issues’ in our surveillance work as well, such as in inequality assessment in 28 countries. There are currently 13 pilots on Gender/ 17 on gender. We will bring these together in the future.
Q: How can the Bank support women business ownership?
Kim: Through the Women’s Entrepreneurship Financing Initiative, the Bank will provide extensive support to women’s micro-enterprises. Within four weeks, we raised $350 million, which we’ll leverage into well over $1 billion. We have been supporting women for a long time through conditional cash transfers and other programmes for a long time. We’re trying to help women get the help they need to build businesses, beyond just small enterprises, with support from both the public and private sector.
Q: How is the Fund working to define the issue of income distribution and growth?
Lagarde: The Fund’s research department have demonstrated that economic growth will not be sustainable with the presence of high-levels of inequality. It was important to base conclusions on data and research. The focus needs to be on policy recommendations that support health and education. Budget allocations in health and education have remained stable in the Fund’s programme countries.
Q: Inequality is transmitted through children. In order to supports the Bank’s focus on Human Capital, what is the Bank doing to break the silos in education and nutrition?
Kim: Sufficient data is needed to support human capital efforts. There are extremely strong correlations between these efforts and GDP growth. We need to create motivation to stimulate investment, on top of focusing on the link between resources and outcomes. Education and health are seen to be heavily driven by demand. The Fund and Bank would also like to displace fossil fuel subsidies for improved health and education.
Q: Why does the Bank support risk-weighted capital requirements?
Kim: There has been a systematic debanking of Africa. We continue to engage with Basel on this issue, and promote de-risking.
Lagarde: Need to develop methods that would support lending to SMEs. These do not exist today.
Q: What can the Bank do to advocate for indigenous rights/ self-determination?
Kim: The Bank does not comment on domestic policies. My charity does, however, work with indigenous communities and recognises their disadvantaged position.
Q: How can the Fund and the Bank engage with the diaspora community?
A: The Fund and the Bank both agree that remittances are extremely important. Perhaps there is a way for both institutions to work together to decrease these costs.
Q: Will the GINI Index be phased out and be replaced by the human capital index?
A: The HDI will not replace GINI. Donor financing will never replace state financing for health and education. There are MICS who spend a lot of money but are not investing in AIDS treatment or in the health of disadvantaged children.
Q (for Bretton Woods Project): When will the World Bank start reporting on its carbon emissions across its investment portfolio?
Kim: Next year, staff will do it. We need to balance renewable energy commitments with developing countries’ need for energy, and we’re dealing with that every day. I discussed with staff and we will do carbon emissions reporting for all projects beginning next year.
Q: How will the Fund support disaster-impacted states? Will you consider a debt repayment moratorium for affected countries?
Largarde: Each state face very different scenarios. Is conducting assessment of conditions. Depending on assessment will determine needs. Funding available by the Fund will be insufficient and states will require additional donor funding. Islands that are under debt distress will need to approach the Fund, and their eligibility for concessional lending will depend on certain criteria. Further, we must also consider the possibility of alternative options, such as insurance schemes.
Kim: We’ve been using Cat DDOs to respond to these disasters: These facilities automatically provide cash to countries that have natural disasters. We’ve actually exhuasted all the funding we had allocated for this facility in the Caribbean due to recent hurricanes. Even though we are happy to have the regional climate insurance schemes in place, countries need to be insured at a much higher rate, as it only covers a small proportion of the damages.
Q: How we address inequalities related gender and economic inequality; what are can be done to get more women on the IMF board?
Lagarde: There are only two women on IMF board; the Australian chair brought this up. But elections are done by the countries, I have no control over that. This is where CSOs could act.