BRIDGE BETWEEN DEVELOPED AND DEVELOPING WORLD

"End extreme poverty within a generation and boost shared prosperity".These two goals World Bank has set to achieve by 2030. At the first glance it sounds good…

While investigating, it has been revealed that projects promoted by financial institutions such as World Bank and International Monetary Fund have both positive and negative effects. According to Boockmann and Dreher(2003), World Bank projects substantially increases economic freedom, while volume of credits may have reverse effect. World Bank provides not only financial assistance but also knowledge which makes governments likely to accept projects. However, historical data illustrates that policy of "Economic Medicine" and "Shock Therapy" aggravated economies of poor countries(www.globalresearch.ca). Perhaps, increasing debt is a key word in this story. For instance, abuse with debt providing has led to tragic consequences in late 90s. In 1998 poor countries owed $2.5trillion to World Bank. Devastating impact of enormous loans increased poverty in developing countries by 300 million people, up to $150billion from 1997. For instance, debt/GDP ratio of Chad, rose from 28 to 55 percent over 10 years (www.whirledbank.org). World Bank Group has a sovereign immunity that exempts the organization from any liability independently of consequences.

It would be no reasonable to blame only World Bank. One may suggest that developed countries use World Bank as an instrument to manage developing countries. On the other hand, developing countries might mimic that they are extremely "poor" to receive exclusively low interest credits.

So what kind of bridge is it?