PRESS RELEASE
FOR IMMEDIATE RELEASE Contact: Lori Udall(202) 387-3500
Bruce Rich (202)387-3500
Smitu Kothari 387-3500
U.S. Congress Puts World Bank on Short Leash
(Washington, D.C.--October 1) In a major break from the past, the
U.S. Congress has voted to limit U.S. contributions to the World
Bank's "soft loan window" to a 2 year period. Previously, Congress
had approved contributions to the International Development
Association (IDA) in three year increments. Congress also cut the
U.S. Treasury Department's 1994 pledge to IDA by $200 million. The
decision follows months of Congressional hearings and debates on
the lack of the World Bank's public accountability and transparency
and it's deteriorating project quality.
"This legislation underscores the growing public sentiment against
World Bank secrecy, lack of accountability and the environmental
and social destruction which characterize Bank lending," said Lori
Udall, staff attorney at EDF, "This sends a clear message to the
Bank that U.S. taxpayers will no longer support business as usual."
Representative Barney Frank (D-MA) of the House Banking
Subcommittee on International Development, Finance, Trade and
Monetary Policy led the initiative to limit the Bank's funding to
two years, after pressing for increased access to World Bank
information and the creation of an appeals panel which would
investigate citizen's complaints about Bank's violations of its own
policies and procedures.
Frank was joined in the initiative by Congressmen David Obey (D-
Wis) and Senator Patrick Leahy (D-Vt), both Chairmen of key
Appropriations Subcommittees which allocate U.S. taxpayers money to
the World Bank. The Appropriations Subcommittees cut funding to IDA
for 1994 by $200 million. The Congressional Conference Report
indicated that further support of IDA would depend on the Bank's
improvement in the areas of increased access to information and
public accountability.
"The decision to limit IDA funds for two years only is a welcome
development, since an institution that is part of the problem
cannot seriously address the global poverty crisis " said Smitu
Kothari, an Indian activist who has been monitoring the World
Bank's performance in India for ten years, "IDA must eventually be
delinked from World Bank management."
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