The Bretton Woods Institutions and Development Partnerships

At the turn of the millennium, the Bretton Woods Institutions, specifically the World Bank and the International Monetary Fund (IMF), changed their lending strategy, from one of conditionality-based aid to one of development partnerships.  Despite the fact that the relatively new tactic of development partnerships is already a decade old, there has been only limited academic exploration of the subject.  If African countries are to benefit to the fullest extent possible from development partnerships, many issues surrounding the practice must be examined.  Specifically, it may be asked:  Do development partnerships truly represent a move away from conditionality-based lending?  Are old conditions simply disguised within the new framework of development partnerships?  Furthermore, in terms of alleviating poverty and stimulating macro-economic development, are development partnerships an improvement over structural adjustment?  And, if so, do development partnerships deserve to receive the same amount of criticism to which conditionality-based aid was subjected?

The World Bank and the IMF have channelled their new focus on development partnerships through two lending initiatives, namely: Output-Based Aid (OBA) and the Heavily Indebted Poor Countries Initiative (HIPC-Initiative).  When one examines the lending mechanisms found within those aid programs, it becomes obvious that development partnerships represent a powerful new form of conditionality.  Both OBA and the HIPC-Initiative possess characteristics which allow the World Bank and the IMF to implicitly control the political arena in borrower countries.  Thus, through the popularization of development partnerships, the Bretton Woods Institutions have indeed perpetuated their old conditions, by disguising them within a new form of international aid.  However, any criticism of the international lending institutions (IFIs) in that regard must be tempered by the fact that development partnerships appear to be stimulating economic development and democratic freedom more than any previous form of international aid.  Nonetheless, the Bretton Woods Institutions’ addiction to political power and control must be cured before development partnerships can fulfill their full potential as a tool for economic development.

Power Relations: How the Bretton Woods Institutions Use Development Partnerships

The French philosopher Michel Foucault once wrote: “Power is not an institution, and not a structure; neither is it a certain strength we are endowed with; it is the name that one attributes to a complex strategical situation in a particular society” (1978, p. 93).  Throughout the twentieth century, the society of international aid has funnelled billions of dollars into the coffers of African states in the hopes of stimulating widespread economic development on that continent.  During that time, the Bretton Woods Institutions constructed what Foucault would label a complex strategical situation for the delivery of aid to borrower countries.  Essentially, the World Bank and the IMF used conditionality-based lending as a tool to control the political arena in developing nations.

Up until the end of the 1990s, international aid was, as a rule, given to African countries only under stringent conditions, which took aim at how those borrower states were governed.  That lending strategy was called conditionality or structural adjustment.  Specifically, the IMF and the World Bank sought to reform their clients by forcing African governments towards economic liberalisation and democracy as a prerequisite to receiving funds.  The power held by the Bretton Woods Institutions, as a result of their position as lenders within the international aid community, granted them significant influence over borrower countries.  However, over time, it became evident that structural adjustment was failing to enact real economic growth and democratic reform in Africa.  Thus, by the end of the 1990s, the World Bank was experiencing heavy criticism from both the political and academic arenas about the ineffective and prejudicial nature of conditionality-based lending.

The IFIs’ established practice of structural adjustment was under fire for its failure to neither reduce poverty nor safeguard democracy.  Policy creators were particularly disappointed with the World Bank’s lack of progress on achieving economic growth in the Third World.  Meanwhile, many academics took issue with the World Bank’s focus on enforcing democracy in borrower countries, alleging that the structural adjustment agenda was co-opting the political process in many developing nations (Abrahamsen a, 2000).  Furthermore, structural adjustment was poorly enforced, with many states continuing to receive aid despite their blatant disregard for the conditions which had been imposed on them by the IFIs (Moyo, 2009).  Therefore, despite the good intentions of donors, heading into the new millennium, much of the African continent remained impoverished and under the heel of authoritarian rule.

However, power is not easily relinquished.  The World Bank and the IMF had enjoyed an uninterrupted reign as the patriarchs of international aid since the initiation of the Marshall Plan in 1947.  Nonetheless, a radical change in discourse was needed in order for the Bretton Woods Institutions to maintain their influence over borrower states.  As such, in response to the widely perceived failure of structural adjustment, the IFIs reoriented their approach to lending by adopting a new focus on development partnerships.  Development partnerships were thus unveiled as a lending technique which would be managed internally, by borrower states themselves.

Essentially, the Bretton Woods Institutions now attest that structural adjustment failed to produce the desired economic growth and democratic reform because such institutional change cannot be forced on a country from outside sources, but must be adopted internally.  As such, development partnerships are ostensibly geared towards sharing ownership and supervision of the poverty reduction process between the World Bank, the IMF and their clients.  The philosophy which is allegedly the basis for that change in the structure of international aid is that granting ownership and control over the development process to third world countries will make aid more efficient, both in engendering economic growth and in encouraging democratic reform.  In reality, however, development partnerships are simply meant to allow the Bretton Woods Institutions to maintain their power over borrower states, while presenting the illusion that third world nations are now controlling their own development.

 

The Heavily Indebted Poor Countries Initiative and Debt Forgiveness

The Heavily Indebted Poor Countries Initiative was founded in 1996 by the World Bank and the IMF.  At the time, the popular discourse in the development community attested that too many poor countries were struggling under the burden of unmanageable debt (Gunter, 2002).  It was in those early years of the 1990s that the increasingly evident conflict between structural adjustment’s failure to create significant economic growth in Africa and the growing debts which most African countries owed to the Bretton Woods Institutions, because of the vicious cycle of loans and interest rates, came to a head.

“Between 1980 and 1990, the low-income countries’ total stock of external debt grew rapidly from US$125 billion (in 1980) to US$419 billion (in 1990).  In contrast, gross national product increased only from US$0.9 trillion (in 1980) to US$1.3 trillion (in 1990).  In other words, the debt-to-GNP ratio increased from less than 14% in 1980 to over 31% in 1990” (Gunter, 2002, p. 5).

In light of those disheartening statistics, the World Bank and the IMF came under fire at that time for their failure to engender economic development in Africa, while at the same time saddling much of the continent with massive debt.

Thus, the HIPC-Initiative was founded, ostensibly “with the aim of ensuring that no poor country faces a debt burden it cannot manage” (IMFa, 2010).  Eventually, the move towards debt relief garnered significant popularity in the public conscious during the 2005 Group of 8 meeting in Gleneagles, Scotland when, under extreme public pressure which was primarily generated by Bob Geldof’s Live 8 concert series, the world’s eight most industrialized economies agreed to cancel the debt of any country which completed the requirements of their HIPC-Initiative contracts.  Thus, it is evident that the creation of the HIPC-Initiative was primarily the result of widespread criticism of the Bretton Woods Institutions’ long-standing lending practices and their perceived failures.  Wishing to preserve their well-established authority within the development community, the World Bank and the IMF conceived of a development technique which would give a semblance of control to developing countries, while sustaining the IFIs’ power to influence the political policies of those same nations.

The implicit conditionality, which is the defining characteristic of the HIPC-Initiative, is disguised within an elaborate framework called the consultation process.  The end result of that consultation process is a document called a Poverty Reduction Strategy Paper (PRSP), which outlines various macro-economic and governmental reforms that a borrower country will enact in an effort to achieve debt cancellation.  The reforms which are found in a state’s PRSP are allegedly drafted primarily by that nation’s government, after a consultation process which ostensibly elicits the opinions of all sectors of society and with only minimal input from the IMF and the World Bank.  According to the IMF, PRSPs are targeted at “promoting national ownership of strategies through broad-based participation of civil society” (IMFb, 2010).  However, closer examination of the HIPC-Initiative reveals that the control which has allegedly been granted to developing countries is only an illusion.  The IMF and the World Bank yet retain a significant capacity to control borrower states’ political policies, particularly those that are found in a nation’s PRSP.  Furthermore, the consultation process, which is meant to include all factions of society, excludes parliaments and civil society, to the detriment of democracy and economic growth in Africa.

In reality, the HIPC-Initiative has not broadened true control over the development process beyond the authority of the World Bank, the IMF and high-ranking government officials in the third world.  Rather, the consultation process creates an environment in which borrower countries face strong and insidious pressure to adopt the Bretton Woods Institutions’ development values and norms.  Interestingly, the World Bank and the IMF hold a veto power, which can be used to void any measures which a developing nation proposes in their PRSP.  That veto is a powerful mechanism, through which the World Bank and the IMF are able to maintain their control over the political policies of the states that they lend to.  As Fraser argues, PRSPs “can be understood as a technology of ‘social control’, which seeks to shape domestic political space” (2005, p. 317).  The veto power held by the Bretton Woods Institutions effectively means that the HIPC-Initiative is a partnership in name only.  The threat of a veto allows the IFIs to silently control what policy changes are drafted in a country’s PRSP.  Since borrower nations already know, from years of experience with structural adjustment, that the World Bank and the IMF value economic liberalization and democratic reform above all else, they are conditioned to parrot those values themselves.  Thus, third world governments have been conditioned to adopt, through the consultation process which they control in name only, the same political policies which the Bretton Woods Institutions forced on developing nations during the era of structural adjustment[1].  As such, the World Bank and the IMF have implicitly imposed conditions on debt relief.

The new form of implicit conditionality which accompanies development partnerships is, in fact, more far-reaching and stronger than were the conditions under the structural adjustment regime.

“On the one hand, much research – and quite a lot of World Bank (but not IMF) rhetoric – emphasises the limitations of conditionality as an instrument for change. On the other, it is arguable that, at least within low-income indebted countries, governments find themselves expected to conform to an even wider array of policy stipulations than in the apparent heyday of conditionality in the earlier 1990s” (Killick, 2004, p. 12).

That increase in conditionality can be attributed to the ‘all in the party’ spirit of development partnerships.  The HIPC-Initiative has encouraged the participation of civil society and private corporations in the development process.  It is obvious that with more donors come more expectations for measurable results and, thus, more conditions.  Essentially, the HIPC-Initiative provides an opportunity for the IFIs to closely monitor the political environment in borrower states by disciplining the participants who are involved in writing a nation’s PRSP (Fraser, 2005).  The veto power which the World Bank and the IMF possess allows them to punish, or discipline, developing countries who do not adopt the same political values as the Bretton Woods Institutions, by voiding such a nation’s PRSP.  Thus, any African government which wishes to enjoy the benefits of debt forgiveness has little choice but to fall in line with the long-standing conditions which are placed on international aid, which are now so subtle as to appear non-existent at first glance.

The World Bank and the IMF attest that the creation of a country’s PRSP is a democratic process, which includes a nation’s government, civil society and citizenry.  The extent to which that assertion is true may vary from country to country, but it has been shown to have limited veracity in the case of Ghana, and it is reasonable to assume that the same is true elsewhere in Africa.  According to Whitfield, the creation of Ghana’s PRSP featured only limited participation from the nation’s civil society, while the state’s parliament was almost completely excluded from the writing process, which was completed primarily by a special government task force (2005).  The World Bank and the IMF claim that the HIPC-Initiative is a democratic partnership, which elicits the participation of all factions of society.  That is patently untrue, as demonstrated by the marginalization of Ghana’s civil society and parliament during the PRSP drafting process.  In practice, democratic ideals are not a feature of the HIPC-Initiative.  Instead, the creation of Ghana’s PRSP was controlled by the executive arm of the government, through a special task force, which was no doubt acting with traditional aid conditions firmly in mind.

Thus, it is clear that the transition to development partnerships has not reduced the capacity of the World Bank and the IMF to impose conditions on the receipt of international aid.  Furthermore, there are instances in which bilateral donors and private service providers have adopted conditions which the Bretton Woods Institutions have allegedly abandoned.  For instance, in a recent official policy speech, the Minister of the Canadian International Development Agency affirmed her government’s commitment to the development of audit standards for aid effectiveness, as well as measures to guard against corruption (Oda, 2010).  As such, developing countries are now faced with the dual-edged sword of the Bretton Woods institutions’ now implicit conditions and newly-minted conditions from bilateral lenders.  Thus, it is evident that technologies of control still dictate the development process and the Bretton Woods Institutions firmly retain the majority of the power in the society of international aid.  The HIPC-Initiative, and the accompanying PRSP strategy, is a way for the World Bank and the IMF to publically project the appearance of having abandoned conditionality, while at the same time avoiding the necessity to enact any actual changes in their lending techniques (Abrahamsen b, 2004 & Whitfield, 2005).  In reality, then, the IFIs’ discursive promotion of development partnerships has not led to a move away from conditionality in practice.

Output-Based Aid and Public-Private Partnerships

By the end of the twentieth century, popular discourse in the development community was becoming critical of the Bretton Woods Institutions’ failure to substantially reduce poverty.  At the time, it was believed that the IFIs were focusing too much on the macro-economic aspects of development, and not properly addressing the plight of the common man (Shepherd, 2002).  It was in that light that Public Private Partnerships (PPPs) were first used as a tool to provide public services to impoverished populations which can not afford to pay the full price for such goods.  Thus, in the international aid community, PPPs are collaborations between private lenders and governments or public service providers, whereby both parties jointly fund community development projects.  There has been a lack of academic literature which examines the World Bank, the IMF and their involvement with PPPs.  However, the IFIs have not been absent from that relatively new field in international aid.

The Bretton Woods Institutions, in their quest to give the appearance of having embraced development partnerships, have created Output-Based Aid (OBA) – their own incarnation of PPPs.  Specifically, in 2002, the World Bank created the Global Partnership on Output-Based Aid (GPOBA), which administers all OBA contracts for the Bretton Woods Institutions.  In the OBA model, third party corporations are contracted by the World Bank to deliver infrastructure services in the developing world.  The services which can be provided by an OBA agreement range from electrical grids, to water sanitation systems, to health care.  Most importantly, the payments that the corporations receive are conditional on the achievement, in concert with third world governments, of certain development goals (or ‘outputs’).  As such, the third party will only be reimbursed for their work after the outputs of the project have been verified by an independent agent.  The publically stated purpose of OBA is that it will make aid more efficient and accountable.  However, closer examination reveals that such supposed partnerships allow the Bretton Woods Institutions to impose conditions on borrower states, while at the same time appearing to cede control over the poverty alleviation process to developing communities.

World Bank literature extols the increased accountability, transparency and efficiency which are said to be the defining characteristics of OBA (Shepherd, 2002).  The Bretton Woods Institutions attest that encouraging more participation from the private sector in international aid will lead to more innovation and efficiency in development projects.  While that may be true, it is also inevitable that implicating private corporations in the development process will lead to the imposition of those companies’ values in the international aid community.  That is, through the increased involvement of private corporations in development, we will see a correspondingly increased desire for profitability and easily-measurable results in aid projects.  Indeed, the World Bank itself implicitly acknowledges that reality.  For instance, Shepherd writes: “The growing use of such contracts reflects the growing interests of governments and donors in results-based management” (2002, p. 1).  Similar language is used by the GPOBA, which portrays OBA as being a highly-refined form of “results-based financing” (GPOBAb, 2010).  While it is not at all unreasonable to expect hard results at the end of an aid project, it is important to examine the manner in which the management of those results allows the Bretton Woods Institutions to place conditions on OBA projects.

According to the GPOBA, the key feature of OBA “is the fact that OBA subsidies are both explicit and performance based, with payments strongly linked to the delivery of specified outputs” (GPOBAa, 2005, p. 7)[2].  The problem with that style of arrangement is that, with the World Bank in control of the purse strings, the Bretton Woods Institutions are in a position of strength which allows them to dictate exactly what outputs will be addressed through OBA agreements.  For example, the World Bank has been particularly vocal about the need for more PPPs between African states and the mining sector, arguing that such contracts would both increase the profitability of the mining industry and protect workers from abuse (Bond, 2002).  However, the World Bank’s goals in championing the mining industry are purely self-serving.  In recent years, the World Bank’s support for Africa’s mining industry, which fuels many of the continent’s bloody armed conflicts, has come under fire (Dansereau, 2005).  In response to that criticism, the Bretton Woods Institutions have sought to reform Africa’s mining industry.  During that process, the World Bank has emphasized the need to liberalize the mining sector and remove state regulations which govern the industry, specifically through the use of PPPs (Dansereau, 2005).  Such measures echo the conditions concerning economic liberalization which were placed on aid funds during the structural adjustment era.  It is reasonable to be concerned that similar constraints may be placed on the World Bank’s growing number of OBA projects.

Another problem with OBA, and other forms of PPPs, is the limited extent to which such arrangements are truly a development partnership.  In essence, there is a power imbalance between the Bretton Woods Institutions and the states which they lend to; a discrepancy which was fostered by years of structural adjustment.  Although OBA fosters cooperation between borrower governments, the IFIs and private corporations, it bypasses the most important members of the development community: the impoverished people who are supposed to benefit from international aid.  “Private sector firms approach local governments and their impoverished communities with the message of power sharing, but once the process is in motion, the interests of the community are often overwhelmed by those of the most powerful member of the partnership – the private sector firms” (Miraftab, 2004, p. 89).  The same thing may be said of the World Bank and OBA.  The OBA model is structured to perpetuate the World Bank’s dominance over borrower countries.  Specifically, the OBA model allows the IFIs to dictate the terms of any agreement, thus marginalizing from the planning process the communities in which OBA projects are implemented.

The power that the Bretton Woods Institutions possess to discipline borrower states is thus once again evident.  Through OBA partnerships, developing countries internalize and adopt the values of the World Bank and the IMF.  In turn, the IFIs are able to subtly impose conditions on the aid which they disburse through OBA projects, while at the same time appearing to hand over control of the development process to borrower governments.  A quintessential example of that phenomenon is the mining sector in Ghana, which (continuing in the tradition of Ghana being the World Bank’s star pupil) modified its mining policies according to the wishes of the Bretton Woods Institutions.  In an official policy speech, the Ghanaian Minister of Mines, Cecilia Bannerman, said: “I believe that in the context of democracy and good governance, it should be possible for even a developing country like Ghana to achieve a significant degree of success in inducing the private sector to make a substantial contribution to sustainable development” (2004).  The Minister also championed the imposition of sanctions for nations which behave badly (Bannerman, 2004).  Given those comments, it is evident that Ghana has adopted a view of development which is very similar to that of the Bretton Woods Institutions.  The use of common World Bank catch-phrases, such as ‘good governance’, ‘democracy’ and ‘sanctions’, indicates that Ghana has internalized all the old conditions for aid which the IFIs supposedly abandoned.

So, it is clear once again that the move towards development partnerships has not entailed a distancing from conditionality.  Instead, like the HIPC-Initiative, OBA partnerships allow the World Bank to quietly impose conditions on aid, all while appearing to have outgrown that policy.  Furthermore, the inclusion of private enterprises in the international aid forum permits those corporations to impose their own conditions on the PPPs in which they are engaged.  Since private businesses are concerned with profit above all else, the conditions which they impose on borrowing states will likely focus on profitability and easily-measured results.  Such priorities are not necessarily compatible with poverty alleviation.  Furthermore, while it is not unreasonable to expect tangible improvements at the end of an aid project, imposing such goals from the outside is eerily similar to the old-style conditionality of the structural adjustment regime.  Moreover, the failure of the OBA model to include local communities in the planning and execution phases of development projects means that such agreements are not true partnerships.  As such, the Bretton Woods Institutions’ eager promotion of OBA is not truly an adoption of development partnerships.

Are Development Partnerships an Improvement Over Conditionality-Based Lending?

Largely absent from the academic literature on development partnerships has been an examination of whether or not such arrangements are more effective at stimulating economic growth, alleviating poverty and promoting democratic liberty than was structural adjustment.  Of course, World Bank literature has been bold in extolling the virtues of the HIPC-Initiative and OBA, but academics have largely contented themselves with studying the political implications of those policies.  Thus, it may be asked, have development partnerships been more successful at spreading democratic freedom than was structural adjustment?  And, have development partnerships alleviated poverty measurably more than did structural adjustment?

In Appendix A, Graph One shows the total amount of Outside Development Assistance (ODA) that Côte d’Ivoire, Ghana, Kenya and Zambia have received in the past thirty years.  During the heyday of structural adjustment, the amount of aid varied greatly across time, but there was a fairly sharp decrease in funds at the end of the twentieth century, coinciding with the development community’s loss in confidence with structural adjustment.  By contrast, under the auspices of development partnerships in the new millennium, the data shows that the total ODA given to those four countries generally increased.  The only exception to that trend is Côte d’Ivoire which has received less aid during that time, largely due to the civil conflict which has simmered in that nation since 2002.  By comparing that information to the data found in Appendices B and C, it is possible to make some tentative conclusions about the effects of development partnerships.

For example, Graph Two in Appendix B shows that, during the new millennium, the Freedom House ratings (which measure civil liberties and political rights in all countries and calculate a combined average score for each one) for Ghana, Kenya and Zambia have been improving at a much more consistent and significant rate than they were during the era of structural adjustment.  Again, Côte d’Ivoire proves to be an exception to that rule, as its government has suffered from the negative effects of civil conflict during the last decade.  Furthermore, Graph Three in Appendix C demonstrates that, during the present era of development partnerships, the Human Development Index (HDI) scores (which measure a country’s poverty relative to the rest of the world) for Côte d’Ivoire, Ghana, Kenya and Zambia have been improving more sharply than they were under the reign of structural adjustment.

It may be tentatively concluded that development partnerships have a greater impact on governance quality and economic development than did structural adjustment.  At the height of structural adjustment movement, during the 1980s and 1990s, the Freedom House ratings for Côte d’Ivoire, Ghana, Kenya and Zambia fluctuated regardless of the amount of ODA that those countries received.  In contrast, since the transition to development partnerships, the Freedom House ratings for Ghana, Kenya and Zambia have been descending steadily.  It is possible, then, that increased consultation with African states over the use of development funds has stimulated liberal governance on the continent.  By holding their clients partially responsible for how aid funds are used, the Bretton Woods Institutions may be increasing the extent to which borrower governments are accountable to their citizens.  Furthermore, since the turn of the millennium, there has been a spike in the HDI scores of Côte d’Ivoire, Ghana, Kenya and Zambia.  It possible that increased spending on social services and infrastructure, through development partnerships, has been responsible for that improvement.

It is imperative that the development community put more resources into studying the impact that development partnerships have on poverty alleviation and governance improvement.  Such academic analysis will help reveal if development partnerships must go the way of structural adjustment, or if their strengths outweigh any weaknesses in terms of conditionality.

Conclusion

It is doubtless, then, that the Bretton Woods Institutions have not rejected conditionality in favour of building true development partnerships.  In fact, aid conditionality has been strengthened, due to its now implicit nature, and augmented by new conditions that bilateral donors are placing on their development funds.  Essentially, the HIPC-Initiative and the OBA model feature many of the same conditions that were placed on aid during the era of structural adjustment.  “Debt relief programs since 2000 seem to be positively influenced by economic and institutional development. . .Recent debt relief seems to be—at least partly—driven by the improvement of governance structures in developing countries” (Freytag & Pehnett, 2009, p. 77).  It seems that the World Bank and the IMF still harbour their age-old self-interest of forcing a particular model of democracy and a specific brand of economic liberalism on borrower nations.  The Bretton Woods Institutions claim to have embraced development partnerships, but they clearly still seek to control the political environment in the developing world.

The nature of the partnerships that the World Bank and the IMF have fostered is also suspect.  For instance, both the HIPC-Initiative and the OBA model exclude essential parties from their partnerships, such as parliaments, civil society and local communities.  In building their partnerships, the Bretton Woods Institutions have defined the word ‘partnership’ in a very limited manner.  Essentially, the World Bank and the IMF consult almost exclusively with the executive arm of the governments which they lend to, but all other aspects of society remain largely marginalized from the development process.  As a result, the Bretton Woods Institutions are not engaging in true development partnerships.

However, preliminary data seems to suggest that development partnerships are stimulating economic growth and democratic freedom to a degree that structural adjustment never managed to accomplish.  Furthermore, is the development community, beyond just the World Bank and the IMF, really prepared to envision a world of international aid without conditionality?  In Ethiopia (which is one of the highest recipients of development assistance), the government has been criticised recently for linking access to aid, such as loan funds and farm fertilizer, to mandatory support for the ruling party, which occupies virtually every seat in the national parliament (York, 2010).  In similar fashion, Laurent Gbagbo won the position of President in the recent election in Côte d’Ivoire, which was widely considered to be fraudulent, and the IMF has refused to recognize his presidency, a fact which could quash any opportunity that the country had for full debt relief under the HIPC-Initiative (Cocks, 2010).  It is undoubtedly arguable that such states do not deserve to receive as much development assistance as does a country like Ghana, which has been certified as ‘free’ by Freedom House.

Foucault defined power as a complex strategical situation within a society.  The World Bank and the IMF have spent decades fortifying their position of power within the development community, by linking desperately-needed international aid to strict political conditions.  It is no surprise then, that when the IFIs were faced with fierce criticism of their lending techniques; they were reluctant to relinquish the authority which they yielded with such vigour.  The manner in which the Bretton Woods Institutions have subtly included implicit conditions in their development partnership programs has been dishonest to be sure.  Such underhanded use of conditionality, if continued, will doubtlessly begin to undermine the HIPC and OBA initiatives.

However, any criticism of development partnerships is very much a case of ‘not throwing out the baby with the bath water’.  Significant steps have been made, through the HIPC-Initiative and the OBA model, to fund both national and local infrastructure in the third world.  For example, a recent OBA project in Ghana increased daily access to clean water from 8% to 87% in one rural community (GPOBAb, 2010).  Furthermore, thirty countries (including Ghana and Zambia) have completed the HIPC-Initiative, resulting in significant debt relief for  those states, which in turn frees up for other uses funds that were previously spent on servicing external debt (IDA & IMF, 2010).  Thus, while conditionality remains a worrying trend in the forum of international aid, important steps have been made in the direction of reform.  Conditionality will become less pervasive and stringent if impoverished populations are permitted to have a hand in designing the aid programs from which they are meant to benefit.  For example, in a survey of Nepalese peoples’ opinions about international aid and conditionality, respondents affirmed that there should be conditions in place, but wished that they were consulted more about such measures (Bhattachan, 1998).  Thus, instead of pressuring the Bretton Woods Institutions to completely abandon conditionality as an aspect of development partnerships, academics should be encouraging the World Bank and the IMF to broaden the scope of such projects to include more diverse voices and opinions from developing countries.

 

Appendix A

Graph 1

 

Graph constructed using data from on the World Bank website database, cited in references.

Appendix B

Graph 2

 

 

Graph constructed using data found on the Freedom House website, cited in references.

Appendix C

Graph 3

Graph constructed using data from the United Nations Development Programme website, cited in references.

 

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[1] Here, the term ‘conditioned’ is used in the sense given by the Theory of Classical Conditioning.  That is, borrower governments learn by association to past lending history that they will be treated more positively if they adopt the values of the Bretton Woods Institutions.

[2] Italics found in original document.

Written by: Joshua Matthewman
Written at: The University of Ottawa
Written for: Rita Abrahamsen
Date written: December 2011