Viewpoint By Rick Rowden ActionAid

Can the World Bank and IMF help the poor?

But the leaders of the World Bank and the International Monetary Fund seem to have missed the message that came from representatives of developing nations.

Poor countries fear that the Bank and the Fund, at their annual meetings in Dubai, will repeat the mantra of the rich world in the Mexican beach resort of Cancun.

The Bank's rhetoric sounds worthy enough. What is wrong with launching its 2004 World Development Report, entitled "Making services work for poor people"?

The devil, however, is in the detail.

Misguided reform?

Hundreds of millions of people lack access to decent education, health, water and sanitation. But the Bank's solution is to propose a far bigger role for the private sector in providing these vital services.

ActionAid works in 40 countries across Africa, Asia, Latin America and the Caribbean.

Experience tells us that far from helping to improve services, the Bank's plans would harm the interests of poor people.

Don't just accept our view. The vast majority of wealthy countries have achieved comprehensive access to good basic services through state, rather than private initiatives.

Corporations which the Bank insists would run things better doubt that sufficient numbers of people in the third world can afford to pay for services at profitable rates.

Subsidies

Business chiefs invoke the word that brought stalemate in Cancun - subsidies - as the added carrot needed to take over from the public sector.

Cancun showed poor countries' resistance to moves that undermine their own people's livelihoods

Last year the Bank approved a development strategy which seeks to use credits and subsidies to attract the private sector in its main lending operations.

However, companies might still target only the better-off who can buy provision - leaving the most vulnerable still out in the cold.

Despite recent contrary statements, the Bank remains vague over its position on user fees.

Yet free, universal provision increases take-up. And universal provision means that campaigning by the most vocal and influential in society benefits everyone.

The Bank's internal evaluation report questions its obsession with services run for profit. Only 40 of 100 privately-run water projects were judged to promise sustainable progress.

Growing resistance

Yet the Bank and the IMF continue to champion private enterprise as a panacea.

Aid to Ghana was made conditional on the government allowing firms from abroad to procure state contracts.

But Cancun showed poor countries' resistance to moves that undermine their own people's livelihoods. They see that growing insistence on privatisation in donors' loan conditions weakens poor countries' capacity to maintain their own public sector.

If the Bank and the fund want better provision for the poor, and to play a major part in meeting the UN's anti-poverty goals, their work must:

• examine why access to effective basic services is so often unavailable to people in rural areas.
• address discrimination on the grounds of age, caste, class, ethnicity, race and religion.
• publish the minutes from their board meetings - how ironic that the Bank cites inadequate accountability in services.
• ensure greater involvement from the poor whose lives they purport to have at heart.