The Development Committee and the IMFC released communiqués laying out their recommendations for action. Generally, a few positive recommendations were made, but we have yet to see a comprehensive, grand plan to protect the world’s poorest people from the fallout of the financial crisis.

The good news first: ONE, along with others in the development community, requested that the Bank “frontload” funding to low income countries. Yesterday’s Development Committee communiqué indicates that this may happen. Frontloading International Development Association (IDA) funding commitments means that the World Bank will have the resources to provide funding to low income countries now in larger bundles over smaller periods of time, rather than spanning it out until 2011. This is critical in order to ensure that development projects already underway can be completed and new projects that help the poor can be implemented.

The not-so-good news: The IMFC Communique recommended that the IMF increase its lending capacity for poor countries, and agreed to explore the idea of giving better terms for low income countries on their lending, but did not specify how far the IMF will go with this. IMF loans also frequently come with burdening economic conditions and has the potential to lead to a new debt crisis.

Also, little progress has been made to reform the IMF and World Bank governance. We are asking that African countries be given strong representation because, after all, institutions like the World Bank and IMF have a very large impact on their development and it’s only right that these nations have a say.

The weekend was productive, but we still have a lot of work to do. Even with the petitions of ONE members, the IMF did not budge on the gold sale issue. We’ll now need to take that up with participating countries to ask them to help us move on this issue. We also continue to ask that funds be made available to poor countries through grants and debt relief, rather than in loans. Additionally, the IMF and World Bank must move forward quickly on reform.

Stay tuned for ways you can help.

-Chandler Smith

Yesterday, Finance Ministers made some recommendations for ways to handle the economic crisis at a meeting of the International Monetary Fund Committee. The document that details decisions made in the meeting (called a communique) described some small steps towards progress.

You’ve already heard how ONE, along with other groups like Oxfam and Jubilee, want the IMF to increase the amount of profits from approved gold sales directed to developing countries. Any progress on that issue would generally be communicated in this document. It appears that the International Monetary Fund Committee has not agreed to follow through on this request which means we still have a lot of work ahead of us on this issue. Otherwise, the document presents some reason for hope for a better deal for the world’s poorest countries.

The IMFC reaffirmed the G20 decision to double lending for low-income countries and instructed the fund to explore ways of making those loans more affordable. This is potentially good news, but the devil, as they say, is in the details.

The IMF now needs to immediately set to work developing an ambitious proposal which delivers increased resources for those who need it most. The Fund must be sure to do this in a way that does not push countries into more debt with unrealistic interest rates and excessive economic conditions attached. “The only conditions,” said ONE’s Oliver Buston, “should be transparency and accountability to citizens on the ground.”

You can read the communiqué in its entirety here.

-Chandler Smith

ONE members have a strong opinion, and in just one week, more than 60,000 have signed our petition to the Managing Director of the IMF Dominique Strauss-Kahn. The petition reads:

Dear Dominique Strauss-Kahn,
Please use the revenue from gold sales to create as much funding as possible for developing countries and ensure that this doesn’t create new debts or have harmful conditions attached.

Yesterday, anti-poverty campaigner Bob Geldof met with Strauss-Kahn and delivered the petition. Afterward, he took a moment to record this message:

Earlier today, ONE held a press conference with the African Development Bank at the International Monetary Fund (IMF) headquarters in Washington D.C. The panel was an interesting mix of distinguished African development advocates and officials, including ONE supporter and activist Bob Geldof; African Development Bank President Donald Kaberuka; Tanzania Finance Minister Mustafa Mkulo; and New York Congressman Gregory Meeks.

The meeting was held in anticipation of the IMF and World Bank annual Spring Meetings. Both institutions will be making critical decisions to follow up on the details of the G20 commitments and determine what will be delivered and with what conditions. The press conference was focused on how the Spring Meetings can provide low income countries – particularly African countries – with the resources they need to get through this financial crisis as well as build on recent development successes, without creating a future debt crisis.

At the event, Bob described how the economic crisis has continued to marginalize the poor peripheral parts of the world. Interesting, Bob remarked that $5 billion (the amount ONE is asking the IMF to provide to developing countries in grants and loans) is a tiny amount compared to the bailout given out in developed countries. Bob referred to a study commissioned by ONE that shows that by injecting $50 billion to Africa now will would increasing global output by as much as $250 billion. He called for aid to Africa to continue and challenged the group to think about how relatively small change can make a big difference.

Mr. Kaberuka described how Africa, in the past several decades, has been a story of progress and setbacks. He questioned the idea of a “banking crisis.” Rather, Africa faces an economic crisis. Mr. Kaberuka emphasized that the amount needed for developing countries is relatively small – the international community pledged $50 billion at the last IDA replenishment and $9 billion for the African Development Bank. Doubling these could have a significant impact.

Mr. Mkulo, the Tanzanian finance minister, spoke about the effects of the crisis in Tanzania. The economic outlook for Tanzania is now estimated to be 5% growth rate for 2009, down from 7.4% a year ago. The effects are felt across the sectors – cotton producers are stockpiling their goods as orders fall, the country’s tourism has stagnated by as much as 20%. He said that African government are trying to tackle the problems in the domestic economies – taking measures to restore macroeconomic stability, increase surveillance systems, and decrease the cost of doing business–but resources are needed to take these measures. He called on the donors to enable the international financial institutions to provide the capital to assist these measures taken by the African government.

Congressman Meeks made a passionate call for the international community to make a historical agreement to mobilize more money to save the most vulnerable in the world, through the IMF gold sales. He said that the biggest burden is likely to be borne by the most vulnerable in the poorest countries, even though they did not cause the financial crisis. The progress made in Africa over 10-15 years is at stake. There is an opportunity today to make history, he said. An agreement to sell a small part of the IMF gold to create an endowment to finance IMF internal expenses was for a good purpose. But the gold prices are higher now, and there is more profit to be made. These extra profits can go to finance the much needed resources for the poor countries. He concluded his remarks by saying that the “moment for us to act is now.”

After these short presentations, there were questions from a number of reporters. I hope that the powerful messages presented by the four distinguished panelists are reported around the world so that the public can understand the gravity of the impact Africa might suffer if we don’t act now.

-Mikiko Imai

Excerpts below:

On the heels of the Group of 20 summit this month, where world leaders agreed to expand the IMF’s emergency borrowing authority by $500 billion, the Obama administration also asked Congress to approve changes to the IMF’s governance structure and a sale of the institution’s gold.

“Other countries are looking to the United States to deliver on our commitment,” President Obama wrote in a letter asking congressional leaders to include the funding expansion and other IMF-related legislation “in the most timely legislative vehicle that will enable the United States to act quickly.”

Remember, you can still sign our petition to IMF Managing Director Dominique Strauss-Kahn asking him to use the revenue from gold sales to create as much funding as possible for developing countries.

-Chris Scott

Please click here to sign our petition to the Managing Director of the IMF, Dominique Strauss-Khan asking him to use funds from the gold sales to help the world’s poorest countries in ways that won’t create debt or hurt their economies with harmful new conditions:

Petition:

Please use the revenue from gold sales to create as much funding as possible for developing countries and ensure that this doesn’t create new debts or have harmful conditions attached.

Let’s make sure the IMF hears from us that this sale is a golden opportunity to help the world’s poorest people without costing us anything at all. Please add your name to our petition, and send a message that the world is watching and demanding the IMF take action now.

-Chris Scott

Overall, yesterday’s G20 Summit communique has left ONE very hopeful, but as always, with a lot of work on our plates. Below, I’ll quote the very succinct recap by our Global Campaigns Director Roxane Philson, and then I’ll include 3 very short flip camera interviews with some incredible G20 Voice bloggers: Nigerian blogger Sokari Ekine, Richard Murphy of the UK (who was able to ask a question about tax havens to Gordon Brown at his internationally-covered G20 press conference), and Kenyan blogger Daudi Were.

Roxy’s Summary:

“Yesterday’s G20 Summit looks like it made some real progress for the world’s poorest. Caution tells me that some of the vague language will take hard work to clarify, but this morning, as I re-read statements and news from yesterday, I am filled with a sense of hope and optimism.

Highlights include:

Resources: The G20 announced US $50 billion for low-income countries – although we are concerned this includes existing funding – and a further US $100 billion in lending for development banks.

Reform: Developing countries will have greater representation in the international financial institutions and that election to World Bank/IMF leadership will be based on merit.

Regulation: The G20 announced regulation of illicit tax havens.

As with all summits like the G20, we’re left with just as much work coming out of the summit as we had going in. We need to work to ensure that money going to developing countries is given as grants, not loans that trigger another debt crisis. Also, much more needs to be done on the green agenda in the interests of developing countries at the UN Climate Change Conference in Copenhagen later this year.”

And below, short interviews with 3 great global bloggers:

Nigerian Sokari Ekine of the blog Black Looks on attending the 2009 London G20 Summit:

UK Richard Murphy of The Tax Research Blog on asking a question on tax haven reform to British Prime Minister Gordon Brown at the internationally-covered G20 press conference:

Daudi Were, who lives in Nairobi, Kenya, and blogs at Mental Acrobatics blog, on the outcomes of the G20 Summit.

Attending the 2009 London G20 Summit as an accredited member of the media was absolutely the opportunity of a lifetime. I just want to publicly thank Karina Brisby, Shane McCracken, Samantha Bronnar, and everyone who put the G20 Voice project together and made it possible for 50 bloggers from around the world to attend this historic global summit. I hope it’s only the beginning for allowing new independent voices, particularly those from from the developing world, into these critical global discussions. I also want to thank our own Weldon Kennedy for handling all of ONE’s G20 Voice project work from the UK.

-Virginia Simmons

Learn more about the G20 and what we hope to see the G20 do for developing nations.

-Weldon Kennedy

1. Developing Country Representation: The G20 calls for better representation of developing countries – both emerging economies and poor countries – in the Bretton Woods Institutions like the IMF and World Bank, in order to accurately reflect the world economy and increase the legitimacy and effectiveness of these institutions. The G20 calls for these reformed institutions to play a role in identifying future crises and responding to them.
2. Trade: The G20 rejects the impulse to turn to protectionist measures to stabilize their economies and promises to refrain from raising new barriers to trade or investment in the next 12 months. The G20 also calls for a successful completion to the World Trade Organization’s Doha Round trade talks.
3. Official Development Assistance (ODA): Considering the impact of the financial crisis on developing countries, and particularly on the most vulnerable in those countries, the G20 countries reaffirm the importance of the Millennium Development Goals (MDGs) and their development assistance commitments. They urge all countries to undertake commitments consistent with their capacities, and re-iterate the principles agreed upon at the UN Conference on Financing for Development that took place in Monterrey in 2002 that emphasize country ownership of and mobilizing all sources of financing for development.
4. Anti-Corruption: The G20 supports the efforts of the Financial Action Task Force that works to combat money laundering and terrorist financing. In addition, the G20 commends the work of the World Bank which is fighting corruption, drug-related activity, illegal arms trading and other illegal activities, and is repatriating stolen funds to developing countries, through the UN Stolen Asset Recovery Initiative (StAR).
5. Follow-up: The G20 Finance Ministers are required to follow up by March 31st, 2009; the G20 will meet again in April of 2009 in London. In preparation for this meeting, Finance Ministers will develop additional principles and recommendations to stem the global financial crisis. One of their tasks is to explore the mandates, governance, and resource requirements of the International Financial Institutions like the IMF and the World Bank. In addition, the G20 commits to the following concerning the reform of International Financial Institutions:

   • By March 31st 2009: The G20 will review the adequacy of the resources of the IMF, World Bank, and other multi-lateral development banks and be ready to increase resources if necessary. The IMF will also draw lessons from the current crisis and work with the Financial Stability Forum (another global body made up of central banks and ministries of finance) to integrate regulatory and supervisory measures into policy. The International Financial Institutions will review and adapt their lending mechanisms to meet the needs of their members in light of the current financial crisis, and explore ways to restore credit to emerging and developing countries in pursuit of sustainable growth and development, with a particular focus on investing in infrastructure.

   • The issue of reforming the Bretton Woods Institutions to give greater voice and representation to developing countries is listed as a medium-term priority for the G20.

Moving towards greater representation for developing countries in Bretton Woods Institutions like the World Bank and the IMF, and ensuring access to credit for developing countries, will help the developing world mitigate the effects of the financial crisis and prevent future crises. The G20 statement reaffirmed the importance of the Millennium Development Goals (MDGs) and development assistance; however, it did not go so far as to re-pledge to meet their respective aid commitments. In addition, the elimination of existing barriers to trade remains unaddressed.

As we’ve previously mentioned, this summit was a pre-cursor to the Financing for Development forum, which is a follow-up to the Monterrey meetings in 2002, that will take place in Doha at the end of the month. Stay tuned for more information.

ONE released a press statement about the outcomes from the G20 which you can check out for additional information.

-Beth Adler

The Economist looks at this weekend’s G20 meeting, saying that while the rules of the global financial system cannot be rewritten in a five-hour powwow, some useful things can come out of the meeting, such as commitments on trade and on reforming the IMF.

Ban Ki-moon has appealed to leaders meeting at a financial summit in Washington this weekend not to let the global crisis become a “human tragedy” for people in poor countries. In a letter to leaders of the G20 Ban said, “The poorest and most vulnerable everywhere, but particularly in the developing countries, will be the most affected” by the world growth slowdown now being predicted. We need most of all to join forces to take immediate action to prevent the financial crisis from becoming a human tragedy.”

In Great Britain, Gordon Brown has called for a new international financial architecture, citing the Bretton Woods conference in 1944 as an example. The Bretton Woods agreement, which resulted in the creation of the IMF and World Bank, is particularly relevant today as we address the “need for global policy co-ordination in tackling” this financial crisis.

The New York Times editorial board today examines some of the challenges that confront the G20 during America’s presidential transition. The Times champions the need for all the participating 20 of the world’s leading economies to reach fundamental agreements as a platform to “begin a serious discussion about the roots of the financial crisis and set the stage for future meetings to discuss substantive reforms.”

-Steve Wilson and Chris Scott