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Economic Justice News
Vol. 4, No. 1 April, 2001

French Parliament Targets IMF / World Bank
Harsh Criticism & Demands for Reform
by Agir Ici (France)
www.globenet.org/agirici

In December 1998, the French government asked Parliament to approve an increase of about $3 billion for the French quota payment to the International Monetary Fund (IMF). Some members of Parliament (MPs) decided that perhaps the time had come to ask how taxpayers' money was being used by the IMF and the World Bank (WB). Until that day most French MPs had shown little interest in these issues. They suddenly realized they knew almost nothing about how and why decisions were being made by the French government ÷ that is, the Treasury - in Washington. Therefore they passed an amendment stating that every year the French government would submit a report to the Parliament about IMF and WB activities, decisions of the Boards, and French positions on these decisions.

 In 1999, together with 40 French associations and NGOs, Agir ici launched a campaign demanding that this report be made public and that the Parliament give instructions on what the French positions should be. The 1999 Report was sent to us by Laurent Fabius, at that time President of the National Assembly (and now the Finance Minister) ˜which was a success in a sense. But the document was so poor that we hardly had any comments, except on what had to be done to improve it.

Last August the 2000 Report was given to the MPs, and posted on the Finance Ministry‚s web site (www.finances.gouv.fr). It provides much more information than last year‚s report, about the IMF, the World Bank, figures and financial aspects but it lacks fundamental things, including:

  • fair evaluation of the consequences of decades of structural adjustment
  • a debate about impact evaluation studies at the IMF
  • analysis of environmental consequences of World Bank-led projects.
These are just a few elements of the criticisms French associations and NGOs have made about the report, the main one being that it doesn‚t address crucial issues such as reform of the global financial architecture, democracy and transparency of the IFIs, the role of France and Europe in these institutions, etc. There is absolutely no questioning of the role and future of these institutions, nor propositions for reforms, which is a bit surprising if you consider the current context (the full analysis by French CSOs is available in French on the web site of the French IFI reform program: www.globenet.org/ifi). The positive aspect is that the parliamentary finance commission has decided that the governmental report was worth a reply. They decided to write a "report on the report" in order to draw the other MPs' attention. The main aim was to give them elements of comparison and information so that they could have a fair view of what was really going on.

An impressive number of hearings have been held by Yves Tavernier, MP of the Socialist Party and rapporteur of the foreign affairs budget for the commission. They included testimony of numbers of NGOs, and we and our partners had the opportunity to present our comments and propositions. In the end the commission issued a report that was presented to MPs and to the press last December. It is entitled "IMF, World Bank : Towards the Night of August 4?", which refers to a famous night of 1789 when the National Assembly decided to end centuries of privileges for the Lords and province. Its main conclusions are that:

  • activities of the IMF should focus on financial aspects and the World Bank should be in charge of the financial support to development  

  • the World Bank should not become a "Knowledge Bank"

  • France should promote strongly the idea that policies and programs of the IMF and the WB are not the only possible development strategy.  

  • IFIs should break clearly with the Washington consensus

  • the WB and the IMF must submit to international rules and conventions, especially social ones.

  • voluntary contributions to the United Nations agencies specialising in development should be increased so that they remain important partners for poor countries.  

  There are also a number of reforms proposed, concerning voting power, evaluation, etc.
  What is also discussed is how French positions and orientations should be defined. The prominent role of the Treasury is questioned, and the commission wants the French Executive Directors (EDs) at the institutions to be accountable not just to the Treasury but also to the Ministry of Foreign Affairs. There could be one at the  Fund and one at the Bank, the latter being mainly accountable to the Ministry of Foreign Affairs. The French ED (or EDs) should be heard by the Parliament every year. A parliamentary delegation to international economic and financial institutions (IMF, WB, WTO, G7, etc.) should be created. Another recommendation is that civil society representatives should be consulted on the definition of French positions.

What can we expect?

  • It is significant that the report of the finance commission refers to the demonstrations that took place in Seattle, Washington and Prague. It means that Parliaments cannot ignore the growing concerns and hostility of ordinary citizens towards undemocratic, non-transparent institutions.
  • Tavernier, the Socialist MP, wants to meet with the President of the National Assembly in order to discuss the creation of the parliamentary delegation.
  • The other propositions for reform of the IFIs and of the French decision-making process are unlikely to have direct consequences in terms of laws passed, but they put the stress on these issues ˜ and pressure on the French government.

Nevertheless, we still have to push for the Parliament to define and control French orientations and positions at the Fund and the Bank. It means we need a debate at the Parliament on the governmental report and a vote. The full report of the commission (300 pages) has been made public in December 2000. It can be downloaded from the following URL : www.assemblee-nationale.fr/2/rap-info/i2801.htm (with a summary in English and German).

Some of the recommendations that have been made in the report are closely linked to things we have been advocating for in the past few years. Therefore we will support them, because we think the MPs are the ones who should be in control, being the people‚s direct representatives. Many MPs can be sensitive to the fact that their country‚s Executive Director can take a stand in Washington that they themselves would fight fiercely in Paris (or London or Madrid). Most of them are also curious to know how taxpayers‚ money is being used, and the reason for that is obvious. It is the role of the French government to define and implement the country‚s policies. If the Parliament has no political will or no way to control them, who will?

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