[stop-imf] ActionAid: Questions for Civil Society about the Limits of Participation in PRSP

[Robert Weissman]

Rethinking Participation:
Questions for Civil Society about the Limits of Participation in PRSPs



A new Discussion Paper by ActionAid USA / ActionAid Uganda

April 2004  Washington, DC / Kampala

http://www.actionaidusa.org/images/rethinking_participation_april04.pdf



=E2=80=9CListening to the voices of the poor=E2=80*, =E2=80=9Ccommunity par=
ticipation=E2=80*
and bold claims to be committed to =E2=80=9Cpoverty reduction=E2=80* in the
world=E2=80=99s poorest countries have been
among the leading high-profile mantras coming out of the World Bank and
International Monetary Fund in recent years.   It has been part of the
=E2=80=9Chappy face=E2=80* the global financial
institutions hoped they could paint over themselves as many civil
society organizations had roundly rejected their economic policy reforms
attached as conditions on development loans.  The
new Discussion Paper by ActionAid USA/ActionAid Uganda, =E2=80=9CRethinking
Participation: Questions for Civil Society about the Limits of
Participation in PRSPs,=E2=80* is designed to
elicit debate and discussion among ActionAid country programs and other
civil society organizations (CSOs) which participate in public
consultations for their national Poverty Reduction
Strategy Papers (PRSPs).



In 1999, the IMF and World Bank responded to 15 years of mounting
international protests against their loan conditions to poor countries
by issuing a very public promise to finally sit
down with citizens=E2=80=99 groups in the world=E2=80=99s poorest countries=
 and
together draft new development policies and loan programs.  The
initiative was called the Poverty-Reduction Strategy
Paper process, or PRSP for short.    The global financial institutions
said they would only give new loans and some foreign debt cancellation
to poor countries who would draft the national
poverty-reduction strategy papers.  The papers are supposed to be based
on a series of government-led =E2=80=9Ctown hall meetings=E2=80* with citiz=
ens=E2=80=99
groups and nonprofit agencies,
women=E2=80=99s groups and development organizations held throughout the
country over a two-year period.



The new Discussion Paper by ActionAid shows, however, that citizens=E2=80=
=99
groups who have attempted to participate in these consultations over the
last four years have actually not been
given any real authority or power to change economic policies.   The
public consultations have done little to change the basic set of
economic policy reforms that the IMF and World
Bank push on poor countries as mandatory loan conditions.  In fact, the
global financial institutions are still pushing many of the same
controversial policies as they have been for the last 20
years.   The high-profile effort to use =E2=80=9Cparticipation=E2=80* rheto=
ric to
get citizens=E2=80=99 groups to stop protesting in the streets and sit down=
 at
the table has now run aground because, after four
years of attempted participation in the processes, no major policy
changes have resulted in the key World Bank and IMF loan conditions.



Citizens groups around the developing world have been voicing demands
for the World Bank and IMF to stop forcing the policy reforms on their
countries through the loan conditions.  The
loan conditions are based on a set of free trade and free
market-oriented reforms including privatization, deregulation, financial
liberalization and removing trade protection for domestic
companies.   For many years human rights, women=E2=80=99s rights,
environmental organizations, health & education advocates and labor
unions have complained about the socially and
environmentally destructive results from these policy reforms.
Economists complained that the policies have failed to help poor
countries achieve high rates of economic growth or
substantially reduce their high levels of poverty, particularly when
compared to the previous 20-year period (1960-1980).    The United
Nations Development Program has criticized the World
Bank and IMF policies for relying too much on foreign trade and the
private sector to drive economic growth.



=E2=80=9CBut when they introduced the PRSP process in 1999,=E2=80* said Jan=
e Ocaya
Irama, Policy Coordinator of ActionAid Uganda and co-author of the new
report, =E2=80=9CWe thought we had
finally been given a real opportunity to discuss these controversial
policies in public and to advocate for alternative policies, but that
has not been the
case.=E2=80*  Instead, borrowing governments of poor countries are well
aware of the fact that their national PRSPs must be approved by the
executive boards of both the IMF and World Bank
before they can access more development loans or get any of the limited
debt-relief for their countries.  Therefore, the borrowing governments
have a stake in carefully regulating what is
allowed to be discussed in the consultations for drafting the PRSPs.



=E2=80=9CThere is a lot of evidence to suggest that borrowing governments a=
re
self-censoring themselves and what they permit to be discussed in these
consultations,=E2=80* said Rick
Rowden, Policy Analyst with ActionAid USA and the other co-author of the
new paper.  He added, =E2=80=9CThey don=E2=80=99t want citizens=E2=80=99 gr=
oups coming up
with all kinds of
alternative economic policies that they know the World Bank and IMF will
never accept, and they don=E2=80=99t want any alternative policies to make =
their
way into the national PRSP strategy paper or else the paper might get
rejected by the World Bank and IMF and jeopardize their access to more
loans.  So
in a lot of ways, citizens=E2=80=99 groups are back to square one.  The tru=
e
participatory process they were promised by the World Bank in 1999 has not
materialized.=E2=80*



The ActionAid Discussion Paper offers suggestions about how the PRSP
consultations might be improved, and it also suggests that citizens=E2=80=
=99
groups consider forming their own public
meetings where they would be more free to discuss whatever economic
policies they choose. =E2=80=9CGetting people together to talk about the
current loan conditions and economic policy
reforms favored by the World Bank is the first step,=E2=80* said Atila
Roque, Executive Director of ActionAid USA and a veteran of the World
Social Forum meetings in Porto Alegre,
Brazil.  =E2=80=9COnly then can citizens=E2=80=99 groups put forward ideas =
for
better policies and then mobilize the public support for their
governments to adopt
such policy changes.=E2=80*



Jane Ocaya Irama added, =E2=80=9CIf the policy prescriptions of the World B=
ank
and IMF loan conditions are to ever change, then it will require that
governments in poor countries
who take the loans need to hear from their own peoples about support for
alternative policies, and if the PRSP consultations are not allowing for
this kind of thing, then groups
may need to act elsewhere, in other kinds of public forums that they
could control.=E2=80*







Paper Summary



 Part 1 of this Discussion Paper reviews the donor-driven nature of the
PRSP process and explores the dynamic in which international creditors
and donors essentially narrow the national
policy making space available in borrowing countries. Part 2 of this
paper documents the four-year track record of how CSOs have been
precluded from publicly debating the current structural
adjustment policies in the public consultations for PRSPs. Despite the
official rhetoric that claims IMF loans (PRGF arrangement) will be based
on the poverty-reduction goals of a
country=E2=80=99s PRSP, evidence suggests that the reality is the other way
around--that PRSPs must, in fact, be aligned within the PRGF budget
constraints set by the IMF. That many
borrowing governments must conform to PRGF lending conditions or else
risk losing access to all other international bilateral and multilateral
creditors and lenders must be acknowledged. It
is important for CSOs to consider the degree to which this external
pressure limits the policy space available, and circumscribes the
outcomes of PRSP consultations. How should CSOs
respond to these limitations?



The main purpose of this Discussion Paper is Part 3, which raises
critical discussion questions for consideration by national and
international CSOs that continue to participate in the PRSP
process. If the structural adjustment policies and possible alternatives
can not be discussed or debated in government-led PRSP consultations,
then CSOs should consider whether
participation in other CSO-led public formats might be a more useful
strategy for advocating alternative development policies and mobilizing
domestic political support for them. Arguably,
the particular features of such alternative civic forums and the degree
to which they supplement the PRSP process or in=EF=AC=82uence new governmen=
t
decisions would vary from country to
country.



The Annex offers a detailed list of =E2=80=9Cforbidden debates=E2=80* on ke=
y
national economic policies that have so far been restricted from the
agendas of government-led PRSP consultations. These
are key development policy questions which CSOs may =EF=AC*nd useful for
public discussions and debates.



By Rick Rowden, Policy Analyst, ActionAid USA

And Jane Ocaya Irama, Policy Coordinator, ActionAid Uganda



http://www.actionaidusa.org/images/rethinking_participation_april04.pdf