Part 2-V Section Outline

Good Governance and Transparency:
Their Impact on Development

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1. The World Bank and the IMF Work With Member Nations to Develop Good Governance and Transparency in Order to Foster Sustainable Development and Economic Growth
2. The World Bank and the IMF See Corruption as the Major Obstacle to Good Governance and Transparency
   1. Corruption, according to the World Bank, is the abuse of public office for private gain and it negatively affects equitable development and sustainable growth.
3. To Understand Corruption In Developing Countries Policymakers Must Come to Terms With Historical Circumstances That Fostered State Authority
   1. Colonialism in Africa led to post-colonial leadership that used power and wealth to survive politically and that subscribed to the view that Africa had to adopt Western notions of development.
   2. Latin America's colonial legacy explains in part the concentration of power in the state and the type of administrative discretion that leads to corruption.
4. People in Developing Nations Use Bribery To Obtain Services That They Cannot Practically Obtain Otherwise
   1. Bribes are used to manipulate scarce benefits or services.
   2. The amount of discretion bestowed upon the civil servant corresponds to the civil servant's ability to accept bribes.
   3. Civil Service in developing nations has historically been low wage employment, and many civil servants feel justified, from an economic point of view, in accepting bribes.
   4. Complex regulatory schemes may lead to corruption.
   5. Legal systems do not protect citizens from corruption.
   6. Foreign entities lock in corruption in developing countries by viewing corruption as a business expense.
5. Corruption Has Numerous Negative Consequences
   1. Corruption among civil servants impedes overall equitable and efficient development.
   2. The secret nature of corruption limits entrants into the market.
   3. Corruption may lead to inflexible prices.
   4. Today, corruption may hinder foreign investment.
6. The World Bank and the IMF Have Instituted Anti-Corruption Programs
   1. The World Bank has called for sweeping anti-corruption reform.
   1. The World Bank stresses the need for civil service reform.
   2. The World Bank is helping developing countries strengthen institutions and transparency.
   3. The World Bank is formulating ways of monitoring corruption.
   4. The World Bank seeks to prevent corruption in Bank-financed projects.
   2. The IMF has undertaken anti-corruption efforts of its own.
7. Critics Claim That the Policies Of the IMF and the World Bank Are Not Wholly Based On Economic Considerations And Eventually Infringe On National Sovereignty
   1. Critics of the IMF believe the Asian financial crisis has exposed the IMF's true agenda of forcing fundamental changes on sovereign countries.
   2. Critics of the IMF believe Western criticism unfairly depicts Asian governments and values as corrupt.
8. Reform of IMF and World Bank Policies Could Bring About a Greater Understanding of Local Circumstances And More Effective Change
   1. Judicial reform is likely to be ineffective in societies that lack strong legal institutions.
   2. Proposals by the World Bank and the IMF foster dependence in developing nations, inhibiting them from creating programs on their own.
9. In Renovating Their Anti-Corruption Programs, The World Bank and The IMF Need to Be Aware of The Real Conditions of Developing Nations
   1. In developing effective anti-corruption programs, the World Bank and the IMFneed to acknowledge national sovereignty and discard programs that cause resentment.
   2. Individual countries have to take initiative in developing programs that will work for their societies.

[Part Two Bibliography]

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