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Churches and Bretton Woods institutions exchange views on development

Author(s):
International Monetary Fund. External Relations Dept.
Published Date:
March 2003
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The IMF and the World Council of Churches (WCC), the main international organization of Protestant churches, along with the World Bank, met to discuss the evolution of their mandates and their views on development, poverty, and social justice. Academics from various countries and disciplines, invited by the WCC, also attended the February 13-14 meeting in Geneva.

Setting the tone for the sessions, Chairman Bob Goudzwaard (former professor of economic theory, Free University of Amsterdam, and a former member of the Dutch parliament) asked whether the institutions were ships passing in the night, greeting each other but then proceeding, each on its own unchanged course. Historically, the WCC and the Bretton Woods institutions had had little communication with each other, and Goudzwaard asked if a closer engagement was either possible or desirable. The discussions were successful in allowing participants both to address fundamental misunderstandings and to help establish a basis of trust for continuing a constructive dialogue.

Ecumenical view evolves

Rob van Drimmelen (General Secretary, Association of WCC-Related Development Organizations in Europe) traced the ecumenical debate on development issues during the twentieth century from the creation of the Commission on Churches’ Participation in Development—the churches’ think tank for these issues—to the development of a global response to the challenges of economic integration.

Initially, the ecumenical debate on development was not much different from the secular debate. Development was seen as a process by which the developing countries followed the example of the more advanced economies to catch up economically. But, as developing country churches became more active in the WCC, the idea of one dominant development model applicable to all countries began to be questioned. In the mid-1970s, the ecumenical movement began to pay greater attention to noneconomic factors in social transformations and to the crucial role of participation. The WCC is credited with the early emphasis on including both the poor and the whole of civil society in social and political decisions that affect them.

In the 1980s, the ecumenical movement broadened its view of development to cover justice and peace and focused on education, training, community development, and the environment. In the first part of the 1990s, as globalization advanced and the jurisdiction of international institutions expanded, globalization and global governance became important elements of the debate. This explains why the WCC agenda now focuses on three items: equity and values, trade, and the reform of the international financial architecture.

IMF paradigm shift

Graham Hacche (IMF External Relations Department) discussed the evolution of the IMF’s governance structure and mandate, highlighting the important paradigm shift that the Poverty Reduction Strategy Paper (PRSP) process represents in the current setting. The constancy of the IMF’s purposes, he said, as set out in the Articles of Agreement, has required the institution to respond to changes, especially in the structure of the world economy and in its membership, and to economic policy lessons the IMF and national policymakers have learned. These changes have radically affected the IMF’s work and help explain how it has adapted its methods and activities over the past half century.

Elaborating on Hacche’s presentation, Peter Heller of the Fiscal Affairs Department discussed the IMF’s perspective on the promotion of poverty reduction and improved distribution of incomes. He explained the importance of seeking a balance between policies designed to enhance growth and those that are specifically geared to reducing poverty and increasing equity. He also described how the IMF takes account of social justice and environmental sustainability.

Brian Ames of the Policy Development and Review Department also pointed to the PRSP process as representing a major shift in the IMF’s emphasis and noted its potential for broadening the debate to include key poverty issues. He reviewed progress made in the design of the PRSP, the significant challenges that still lie ahead, and the efforts that will be required from the international community if poverty is to be further reduced.

Shared goal

The meeting showed that, despite a history of misunderstandings and differences of opinion about their roles and priorities, the Bretton Woods institutions and the World Council of Churches share the goal of reducing poverty in the world. The main recurring themes were accountability of institutions, global governance, strategies for encouraging participation, responsibilities of the public and private sectors, and alternative measures of human development.

At the end of the two days, the participants expressed appreciation for the dialogue and unanimously agreed that it should continue. The next meeting, scheduled to be held in Washington in the fall, will focus on the participatory process in the context of the PRSP and the roles of the public and private sectors in the economy. It will also continue the discussion of broader issues, including governance (of the international financial institutions and of national governments) and responses to the challenges of economic globalization.

The Bretton Woods institutions and the World Council of Churches share the goal of reducing poverty in the world.

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