World Bank policies in Third World criticised for frustrating aid aims

WORLD Bank financial policies in the most impoverished African countries are frustrating the aim of Irish aid to help the "poorest of the poor", according to a leading Africanist.

"The World Bank and the International Monetary Fund are doing so much damage to African economies that Irish aid amounts to no more than a sticking plaster applied afterwards," Dr Joseph Hanlon claimed in Dublin at the weekend.

Dr Hanlon said aid from donor countries such as Ireland should not be conditional on a developing country's support for IMF/World Bank prescriptions for structural adjustment. Instead, he suggested, aid should be linked to social indices such as the participation of girls in education or the provision of health services.

Speaking at a seminar on the role of the IMF and the World Bank in the Third World Dr Hanlon accused the two institutions of "economic fundamentalism" in their approach to African economies such as Mozambique's.

Although the war there caused the destruction of most schools health centres and roads, the IMF has insisted on cuts in the economy designed to get rid of inflation rather than spending on reconstruction.

"Their work starts in good faith but ends in blind faith. They spend too much time looking at their own spreadsheets," he told the seminar organised by Irish Mozambique Solidarity and the Debt and Development Coalition.

After the second World War in Europe, the first goal was to repair and rebuild as quickly as possible, and this worked. Yet in Mozambique, another post war economy, the IMF was saying the opposite.

"Other African countries which have been in turmoil - Angola, Sierra Leone, Liberia - will face the same economic crisis unless these policies are changed. In Rwanda, can you tell me the Hutus and Tutsis won't be at each other's throats if they remain poor? It's a recipe for war."

Dr Hanlon praised the Irish Government for its decision not to contribute to the IMF's Enhanced Structural Adjustment Facility until the Fund takes action to tackle the Third World debt problem.

A representative of the World Bank, Ms Katherine Marshall, denied the charge of "fundamentalism". Structural adjustment programmes were originally devised to rescue countries from economic chaos, she said. Since then, they had changed fundamentally and a considerable consensus on macroeconomic issues had grown up.