News Release

Analysis of Clash Between IMF and World Bank

A new report by the World Bank is sparking controversy because of its criticism of the IMF’s policies related to the Asian economic crisis. Among those available for comment are:

ROBERT NAIMAN
A research associate at the Preamble Center who specializes in assessing the impacts of economic globalization, Naiman said: “The good news is that the World Bank admits that punishingly high interest rates have destroyed these economies and that nations need controls on capital flows. The bad news is that it still funds IMF bailout packages that impose impossibly harsh austerity conditions on developing countries.”
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CATHERINE CAUFIELD
The author of Masters of Illusion: The World Bank and the Poverty of Nations, Caufield said: “It’s outrageous that the World Bank should criticize the IMF and the U.S. without acknowledging that it pursued the same policy of deregulating financial markets that led to the present instability. The Bank has been trying to distance itself from the IMF, but the fact is that it has pursued the same flawed policies since the 1980s.”
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JEFFREY WINTERS
Winters is a professor of political economy at Northwestern University who has written widely on Southeast Asia. “The World Bank’s years of tolerating corruption contributed as much to the current Asian crisis as the more proximate policies of the IMF,” said Winters, who is author of “Power in Motion: Capital Mobility and the Indonesian State.” “Over the course of the Suharto regime, for example, the Bank loaned roughly $30 billion to Indonesia, knowing that roughly a third — by the Bank’s own admission — was being systematically stolen.”

NJOKI NHOROGE NJEHU
Director of the 50 Years Is Enough Network, Njehu said: “People have been suffering from the IMF/World Bank policies for over 20 years, not just the last year in Asia. What is different is that some bankers and investors lost money this time — though they benefitted from the bailouts, while poor and working people were excluded.”
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CAROL WELCH
The international policy analyst for Friends of the Earth, Welch recently authored a paper titled “IMF and Good Governance.” Welch comments: “It’s refreshing to have the World Bank finally criticizing the austerity programs of the IMF…. The report demonstrates the need to rein in rampant speculative capital. They should have ‘speed bumps’ for capital outflows.”
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For more information, contact at the Institute for Public Accuracy: Sam Husseini, (202) 347-0020, or David Zupan, (541) 484-9167.