[mgj-discuss] Wash Post Business Sec, Apr 18: Protesters Easing Up on IMF, World Bank

[Denis]

The Washington Post Business section today chimed in on the protests.  The
secondary headline, on page E6, reads, "Protesters Easing Up on IMF, World
Bank"

Fewer Clouds Overhead For IMF, World Bank
     
By Paul Blustein
Washington Post Staff Writer
Thursday, April 18, 2002; Page E01

Among the dark-suited economic policymakers who attend the semiannual
meetings of the International Monetary Fund and World Bank, high fives are
considered unseemly. But the officials converging on Washington this weekend
for the institutions' spring meetings might deem a hearty backslap or two to
be in order.

The global economy, which a few months ago was widely feared to be headed
into a slump, now appears to be recovering (trouble spots such as Argentina
and Japan notwithstanding). And the left-wing groups that bedeviled recent
IMF-World Bank meetings are planning to pay only cursory attention to the
international financial institutions this time; the demonstrations this
weekend will be aimed chiefly at protesting U.S. policy in Afghanistan and
the Middle East.

All this is in marked contrast with the last time a major IMF-World Bank
meeting loomed, in the fall of 2001. That conclave, which was canceled after
the Sept. 11 terrorist attacks, was expected to draw as many as 50,000
activists demonstrating against the free-market policies that the fund and
the bank prod developing countries to adopt. An even bigger headache facing
international policymakers at that time was the simultaneous slowdown in the
United States, Europe and Japan that threatened to get even worse after the
attacks.

So the sense of relief -- if not smugness -- is palpable among the barons of
the global economy as they prepare for this weekend's gathering.

"In April 2002 it is clear that September 11 did not pull down the global
economy for long," Horst Koehler, the IMF's managing director, said
yesterday in a speech at the National Press Club. "A recovery is underway
now in the United States, and this is already beginning to have a positive
impact on the economies in other regions."

In an unusual act of self-congratulation, Koehler added, "it is fair to say
the IMF has played a role in this," in part by providing emergency loans
that shielded countries such as Turkey and Brazil from succumbing to crises.

The IMF's forecast, which will be officially released today, predicts that
the global economy will grow 2.8 percent this year, Koehler said -- hardly a
sizzling pace, but substantially better than the 2.4 percent the fund
forecast in December. (Some analysts consider the world economy to be in
recession when the overall figure dips below 2.5 percent.)

The fund's economists have made particularly large revisions in their
forecast for the U.S. economy, which they now predict will expand 2.3
percent this year, compared with the December forecast of 0.7 percent.
Koehler said he was happy to announce that he would pay off a bet with
Treasury Secretary Paul H. O'Neill by treating him to dinner; O'Neill had
wagered that the IMF's earlier forecast was much too pessimistic.

As for the protesters, Koehler didn't mention them in his speech, but their
admittedly diminished ability to disrupt the IMF and World Bank meetings is
gratifying to officials of the two institutions. "Frankly speaking, we do
not expect anything like the events of two years ago," Thomas Dawson, the
IMF's chief spokesman, said last week.

Critics of corporate globalization are promising a protest and march on
Saturday morning that will have plenty of energy and humor aimed at IMF and
World Bank policies.

"What we do not expect to see is large numbers," said Robert Weissman, a
representative of the Mobilization for Global Justice, acknowledging that
most of the weekend's action will involve other protests, including one
supporting the Palestinian cause.

Such statements reflect the recognition by many in the anti-globalization
movement of the impact that Sept. 11 has had on their capacity to arouse
indignation over issues such as privatization, deforestation and food
safety.

Movement leaders are comforting themselves with the hope that they will
regain momentum by next autumn, when they are planning to mount much bigger
demonstrations against IMF-World Bank meetings scheduled for that time. Some
contend that the heightened attention to geopolitical issues could redound
to the movement's benefit.

"I think the period where the air was kind of let out of us is rapidly
passing," said Soren Ambrose, a representative of the Fifty Years Is Enough
campaign. "I don't know if we're back to where we were [before Sept. 11],
but we're making the connection between [geopolitical] issues and the
economic issues. The concern about the U.S. being hated is to a large extent
rooted in the economic arrangements of the global economy -- arrangements
run by the IMF, the World Bank and the [World Trade Organization]."

But by allying with groups that are protesting the Bush administration's
anti-terrorism policies, organizations such as Ambrose's are risking
alienating the U.S. labor movement, which provided key support at events
such as the 1999 WTO meeting -- otherwise known as the "Battle of Seattle."
Organized labor is not participating in this weekend's protests because of
its backing for the White House on the terrorism issue, according to
officials of the AFL-CIO, although they noted that they joined several other
groups yesterday in issuing a report critical of World Bank policies.

Accordingly, IMF and World Bank officials expect to be able to devote
themselves this weekend to addressing immediate economic issues rather than
dueling with the protesters. In the IMF's case, one of the main concerns is
Argentina, whose economy minister, Jorge Remes Lenicov, complained this week
that in exchange for providing Buenos Aires with desperately needed loans
the fund is demanding cuts in government spending that could throw 450,000
government employees out of work. He told the Financial Times that "at a
time of very high social conflict," it would be "crazy" to insist on mass
firings of that scale.

Koehler minced no words yesterday in responding to Remes Lenicov's remarks.
"There will be layoffs, but there's no choice," he said, adding that because
of Buenos Aires's profligacy in the past, "there is a need to adjust to less
wealth and prosperity." If Argentines can bring themselves to "swallow some
kind of bitter medicine," he said, "I have no doubt" living standards will
improve in the long run.


© 2002 The Washington Post Company



------------------------------------------------------------------------