WORLD PEACE, THE WORLD BANK & THE IMF

Many are tied to opening up their economies and being primarily commodity. In reality this has meant poor countries have entered a spiraling race to the bottom as each nation competes against others to provide lower standards, reduced wages and cheaper resources to corporations and richer nations. This has increased poverty and dependency for most people. It also forms a backbone to what we today call globalization. As a result, it maintains the historic unequal rules of trade.

Poor countries in debt to these institutions are told to minimise government intervention, privatise public services, and attract foreign investors. Some argue that when the powerful nations make a developing nation open up to allow more imports in and export more of their commodities, this keeps the nation in poverty and dependency. In theory, they support democracy but the policies they enforce can undermine the democratic in poor countries.

“It’s not right for a bank to run the whole world,” says Fred M'membe, editor of the Zambia Post. “They do not represent anybody other than the countries that control them. What this means in practice is that the United States runs our countries.” He continues: “Look at any African country today, and you'll find that the figures are swinging down. Education standards are going down, health standards going down and infrastructure is literally breaking up.”
— Mark Lynas, Letter from Zambia, The Nation, February 14, 2000

The IMF and World Bank’s policies are very different now from their original intent, as summarized here by the John F. Henning Center for International Labor Relations:
The International Monetary Fund and the World Bank were created in 1944 with the goal of creating a stable framework for the global economy after World War 2. The IMF was originally envisioned to promote steady growth and full employment by offering unconditional loans to economies in crisis and establishing mechanisms to stabilize exchange rates and facilitate currency exchange. Much of that vision, however, was never born out. Instead, pressured by US representatives, the IMF took to offering loans based on strict conditions, later to be known as structural adjustment or austerity measures, dictated largely by the most powerful member nations.

The World Bank (The International Bank for Reconstruction and Development) was created to fund the rebuilding of infrastructure in nations ravaged by World War Two. Its vision too, however, soon changed. In the mid 1950’s, the Bank turned its attention away from Europe to the Third World, and began funding massive industrial development projects in Latin American, Asia, and Africa. Many scholars and activists contend that the Bank’s aggressive dealings with developing nations, which were often ruled by dictatorial regimes, exacerbated the developing world’s growing debt crisis and devastated local ecologies and indigenous communities. Both IMF and World Bank policies remain a source of heated debate.

The IMF and World Bank are largely controlled by the developed nations such as USA, Germany, UK and . The USA controls around 18% of the voting power at the IMF, so when an 85% majority is the USA effectively has veto power at the IMF. The World Bank is 51% funded by the U.S. Treasury.