A Comparison Between World Bank Accountabilityand World Bank

A Comparison Between World Bank Accountability in Chad With Reforming the IMF and World Bank

In Winters and Gould’s World Bank Accountability in Chad, it argued that World Bank could not take the responsibility to develop the undeveloped countries by the investment of resource, but it made Chad that lacked the actual mechanisms of domestic accountability in a worse situation. The aim of World Bank was to invest in the oil resources of Chad to alleviate the poverty and foster the development of the country with the help of constructing the local governance institutions and an expenditure scheme which supported underdeveloped countries. However, due to the poor governance and weak political accountability of Chad, World Bank failed its attempts. Although at first Chad made some development by World Bank’s project, it did not last long. With the increase of the wealth brought by the oil resources, the political authority and clan-based patronage in Chad wanted to much more power to control its wealthy line. On the same time, the World Bank was not able to and lacked the mandate to tackle this problem. At the end of the article, authors proposed two recommendations for the World Bank to improve the situation of Chad. On one hand, World Bank should invest in the scarce resources and renewable and clean energy resource. On the other hand, World Bank should select the country that was capable of managing its revenues effectively, which meant that the capable country could utilize its revenues to the development of the country. Moreover, even though the selected country could not have the capability to manage the revenues, the World Bank should conduct “resource curse due diligence.” (Winters & Gould 241) Besides two improvements were put forward. First, the World Bank should pay attention to the indirect revenues of the project, and second, it should have “a constitutional amendment conditioning revenue transfers from the escrow accounts on such things as real improvement in the government’s performance in improving regional equity and human rights (Winters & Gould 242).”

In Ngaire Woods’ Reforming the IMF and World Bank, it discussed that the policies made by the IMF and World Bank were controlled by the preferences of the powerful countries and countries that had less power could never sway the policies of these two institutions. That is to say, political elements played a vital role in the process of making plans for the IMF and World Bank. The author put forward six significant reforms to change this situation. First, the redistribution of the charge burdens of the borrowers should be made. Second, more members should be involved in the decision-making activities. Third, the discussions and decisions reached by the board should be published in a transparent way so as to realize good scrutiny. Fourth,  the accountability should be strengthened of each member by reporting to parliaments. Fifth, the representative leadership selection process should be altered. Finally, it was the high time to rewrite the incentives for staff. In a word, both the IMF and World Bank should make their policies after balancing the different competing interests appropriately, which meant that they should “rebalance power and accountability so as to give borrowing members more direct voice with each institution (Woods 212).”

Both these two articles revealed that political factors were central to the IMF and World Bank, no matter the internal political factors or the external political factors. These political factors include the governance structures and political policies. These political factors heavily influence the operations of these two international organizations. From the perspective of the
internal political factors, the governance structures of these two organizations were controlled by the powerful countries and consequently, policies made were always inclined to take considerations of the interests of these powerful countries and ignore the benefits of the marginalized countries. Moreover, from the perspective of the external political factors, the redistribution of money different projects that these two international organizations invested on brought in would inevitably be affected by the authorities of the local countries because these two organizations could not compete with any undemocratic government.

Although political factors exert a profound influence on these two agencies, in essence, the failure of these two organizations lies in that they lack a democratic, equal and transparent operation system, which provides those powerful countries and local authorities an opportunity to take charge of the organizations and the unbalanced interest distributions.

Regarding differences, for these two articles, the former World Bank Accountability in Chad, emphasized the vulnerability of World Bank in dealing with the matter with the local authorities in undeveloped countries. Moreover, the authors believed that it was impossible for World Bank to accomplish its goal in an undemocratic country and the policy made to foster the development of Chad with the oil resources was also totally wrong. In this article, the author paid more attention to the cause of failure—the undemocratic country World Bank chose to invest in. In other words, it was the non-democracy that should take responsibility for the failure of World Bank. However, the latter one, Reforming the IMF and World Bank, the author focused on the inherent incapability of these two organizations, which meant that they were incapable of fulfilling their duties. They could not represent the interests of most members and were not able to balance the interests of each member as well. The incapability of these two organizations was out of the incomplete institutions. This is to say, there were no guarantees for these organizations to undertake their responsibilities. Their policies made were not out of their independent judgments but by the interests of some influential members, which inevitably rendered the inequality of members in these organizations.

All in all, for organizations, like the IMF and World Bank, they have their vulnerabilities. They are not independent bodies which could make their decisions appropriately and reasonably. The lack of good governance and scrutiny institutions of these organizations caused these groups severely influenced by politics, which further led to the unbalanced distribution of the interest. Thus, the failure of the projects these organizations invest on is doomed. As far as I am concerned, to improve the status of these groups, the most important thing is to reform the inner institution system of them. They should complete their institution system in order to make their decision-making process more reasonable and proper. The reformation of the institution system includes that the decision-making process should be more open, democratic and just than before. Scrutiny system should be brought in these organizations, which can ensure the equality and interests of each member of these organizations. Besides, these organizations are supposed to be independent organizations, which meant that they should try their best to avoid the influence of politics. Although it is difficult for them to get rid of the influence of politics, at least they should take an objective stand to deal with the international affairs. The objective position requires the guarantee of the system as well. Therefore, the current urgency for these international organizations is to complete their institution systems as best as they can. The completion of their institution systems will foster these organizations to form good governance so that they will be capable of tackling with different matters all around the world. (Total 1208 words)