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How to tackle global challenges: The IMF & World Bank blueprint
The International Monetary Fund and World Bank’s Spring Meetings in Washington have told a tale of two economies: In the developed world, inflation is falling, and recession looks unlikely. But many of the world’s poorest countries are struggling under tremendous debt burdens inflated by rising interest rates that threaten to undo decades of development progress. That means these key lenders of last resort have their work cut out for them.
The good news? There’s a proven model, as GZERO Senior Writer Matthew Kendrick discussed with Tony Maciulis at a Global Stage event while reporting on the meetings. Somalia, once the byword for a failed state, managed to implement massive reforms to its financial system to meet the guidelines of the IMF’s Highly Indebted Poor Countries Initiative.
“Because they met those guidelines — while still in a very fragile environment where they were fighting Islamic extremists in the country, dealing with semi-autonomous zones in the north — they managed to discharge 90% of their debt,” said Kendrick. “It's proof that even in very fragile countries, if, as the Somali finance minister said yesterday, you build these projects into nationally unifying efforts to build a better future, they can have tremendous success.”
Kendrick also cited comments from experts calling for the IMF and World Bank to change how they view humanitarian work more generally and not back away from countries amid war. “Conflicts are becoming a day-to-day part of our lives all over the world,” he says. “That means that the IMF and World Bank, in order to make progress on development, have to figure out ways to work with the institutions in these countries as they are also in conflict.”
For more of our 2024 IMF/World Bank Spring Meetings coverage, visit Glogal Stage.
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People gather as they watch from afar after an alleged gang member was killed and set on fire, amid an escalation in gang violence, in Port-au-Prince, Haiti March 20, 2024.
Want to stabilize the world’s worst crises? “Leave your textbook in your drawer.”
Matthew Kendrick spoke with Ghassan Salamé, the former head of the UN Support Mission in Libya, and former UN Deputy Secretary-General Lord Mark Malloch-Brown, as part of a panel at the IMF/World Bank Spring Meetings on Wednesday.
The international community is struggling to address half a dozen conflicts, spanning from the Middle East to Haiti, that often involve institutions poorly equipped to tackle modern problems. But that doesn’t mean they can afford to stop trying; it just means they need to get creative.
“The most urgent need is to bring back humanitarianism as a domain independent from war,” said Ghassan Salamé, the former head of the UN Support Mission in Libya, noting that the basic concerns of food, education, and healthcare must not be held hostage to military objectives. “And you cannot apply it in a selective way. You have to apply it in Ukraine with the same strength you do in Gaza.”
Bias in attention is especially stark for Sudan, where just 3.2% of humanitarian needs have been funded despite a brutal civil war that has killed over 15,000 and forced a staggering 8.2 million to flee.
“Indifference is much worse than hostility,” said Salamé. “Sudan needs concern.”
Part of the problem, according to former UN Deputy Secretary-General Lord Mark Malloch-Brown, is that “humanitarianism was based on the idea that conflict is temporary, and then you go back to development.” That means when the shooting starts, the IMF and World Bank tend to back away and wait for the dust to settle before starting to help stabilize the affected economy. That just won’t fly in the 21st century, and Malloch-Brown called for the institutions to develop new tools to provide help before, during, and after a country falls into violence to strengthen key unifying institutions, such as ministries of finance, education, and social welfare.
The key, said Salamé, is to “leave your textbook somewhere in your drawer and try to solve the situation as it is.”
Looking at crises in developing countries along longer trajectories can help highlight their hidden potential. When asked how these new approaches could apply to Haiti, where the formal government has all but collapsed, Malloch-Brown said the country “never had the degree of internal development, social reform, or inclusive economic policies that allow a stable polity to emerge.” If Haiti receives “a persistent period of tender love and care,” he added, its economic potential means “I’m optimistic enough to believe it can be fixed.”
New Delhi, Mar 10 (ANI): Prime Minister Narendra Modi addresses the launch of Mahtari Vandan Yojana in Chhattisgarh via video conferencing, on Sunday.
Hard Numbers: India & EFTA sign trade deal, Oppenheimer's Oscars, Biden's big haul, Portuguese polls, Irish vote down constitutional change, New hope for Libya
100 billion: India has signed a trade agreement with the four members of the European Free Trade Association — Iceland, Liechtenstein, Norway, and Switzerland — aimed at integrating supply chains and opening new opportunities for trade and investment. The deal includes a commitment to invest a whopping $100 billion in India over the next 15 years to create 1 million jobs.
7: The big winner at the Oscars on Sunday was "Oppenheimer," director Christopher Nolan's historic drama about the invention of nuclear weapons, which took home seven prizes, including Best Film. The documentary "20 Days in Mariupol" also won Ukraine its first Oscar.
10 million: The Biden campaign says it raised over $10 million in the 24 hours following the State of the Union, which served as a de facto campaign event. It’s the campaign’s largest one-day haul yet. With a long eight-month campaign ahead, the Biden team has been stockpiling a war chest as Trump fought contested primaries (not to mention legal battles).
79: The Portuguese center-right Democratic Alliance took 79 seats in Sunday's elections, ousting the incumbent socialist party but falling well short of the 115 seats it would need for a majority government. The party's leader, however, swore he would not work with the far-right Chega party, which surged in the polls, to establish a majority.
73.93: On Friday, Irish voters rejected proposed constitutional changes concerning the concept of family and care in a nationwide referendum. The first proposal would have recognized “family” as a couple without regard to their sex, while the second aimed to strip reference to the role of women in the home. Well over half, some 67.7% of Irish voters, opposed the first, while 73.93% said no to the second.
3: Progress in Libya’s long conflict may soon be at hand: On Sunday, three leaders agreed on the need to form a new unified government to supervise the country’s long-delayed elections. Elections were due in December 2021, but fell apart owing to disputes over who was eligible to run.FILE PHOTO: Russian officers from the Wagner Group are seen around Central African president Faustin-Archange Touadera, as they are part of the presidential security system during the referendum campaign to change the constitution and remove term limits, in Bangui, Central African Republic July 16, 2023.
Have gun, will travel? Russia wants you in Africa
Moscow has reportedly begun recruiting 20,000 soldiers to be deployed to at least five Russia-aligned African countries to replace Wagner Group mercenaries previously stationed there as Russia deepens its influence on the continent.
Just how many recruits “Africa Corps” can drum up is not clear (nor is why they named themselves after a Nazi unit, Afrika Korps, that got its arse kicked up and down Libya before surrendering en masse). Many Wagner fighters took contracts with the Ministry of Defense after an aborted revolt by former leader Yevgeny Prigozhin resulted in his death and the company’s disbandment, and those with experience in Africa may be rolled into the new unit. Then again, with Moscow trying to find 250,000 more men to throw into Ukraine, some recruits may figure that sweating it out in the Sahel beats getting shelled in a rat-infested trench.
The troops will provide security for coup leaders in Mali, Burkina Faso, and Niger, as well as the House of Representatives government in Libya (not recognized by the United Nations) and the Central African Republic, which has drifted toward Moscow since 2016. In exchange, Russia will help themselves to Wagner’s former commercial fiefdom on the continent, including potentially lucrative mining operations producing gold, diamonds, and valuable industrial minerals.
But it’s a gamble: Wagner’s force in Africa was only ever a fraction of the size of this putative Africa Corps, and as a nominally private company, Moscow could shrug its shoulders when Wagner fighters committed atrocities. Now, the Russian flag would be undeniably flying over the murder, torture, and rape of civilians – but color us skeptical that the potential international opprobrium will hold them back one bit.A mangrove forest is seen in Matang in Malaysia's northern state of Perak. Picture taken July 29, 2003
Hard Numbers: Pakistan plants mangroves, Hezbollah-Israel clashes deepen, Bidenomics goes bust, Liberians decide a runoff, Italy recaptures king of the jungle
142 million: A Pakistani project to revive mangrove forests in the Indus River Delta could absorb as much as 142 million tons of carbon dioxide over the next 60 years. Mangroves not only prevent erosion, they also sequester huge amounts of greenhouse gasses. But the project has stirred controversy, as it is backed by a company that is promoting it to sell carbon credits to polluting companies.
2: Israeli airstrikes on Monday killed two people in southern Lebanon, on the same day an Israeli electric worker died of wounds suffered in an earlier missile strike by Hezbollah in northern Israel. In the weeks since Hamas attacked Israel on Oct. 7, cross-border clashes between Hezbollah and Israel have surged to their deadliest levels since the two fought a monthlong war in 2006, raising fears of a wider regional war. Who are Hezbollah? Read our explainer here.
14: Well, last week’s midterm elections may have gone better than expected for Democrats, but their main problem remains: The American people just don’t think Joe Biden has been a great president. A new FT poll shows just 14% of registered voters say they are better off today than they were when he took office. The president has struggled to convince voters that Bidenomics is really helping the middle class — with Americans pointing to persistently high inflation as their biggest concern.
56: Speaking of discontent with incumbents … as Liberia heads into what will likely be an extremely close presidential election runoff, a new Gallup Poll shows 56% of Liberians believe their standard of living is getting worse, and 3 out of 4 say they have had trouble securing enough food at least once over the past year. The vote Tuesday pits incumbent George Weah, a former soccer star, against former veep Joseph Boakai. Weah defeated Boakai in the first round last month by less than half a percentage point.
8: To wish someone good luck in Italian, you’d say in bocca al lupo! — which means “into the wolf’s mouth!” But what should you say to authorities tracking an escaped circus lion in a suburb of Rome? Eight-year-old Kimba enjoyed a leisurely stroll around the seaside streets of Ladispoli on Saturday before he was captured in a massive operation involving local and national police.
Men and paramedic staff help transport a man who was injured in a blast in Mastung to a hospital in Quetta, Pakistan.
Hard Numbers: Pakistan blast, mRNA Nobel win, Kaiser Permanente strike, escaping Nagorno-Karabakh, flights to Libya, cashing in rupees
59: Fifty-nine people were killed Saturday in a bomb blast at a mosque in Mastung, Pakistan, where people were gathering to mark the birthday of the Prophet Mohammad. Pakistan’s interior ministry accused India’s intelligence service of masterminding the attack, a charge Delhi denies.
2: Two scientists, Professors Katalin Karikó and Drew Weissman, won the Nobel Prize in Physiology or Medicine on Monday for having developed the technology that led to the mRNA COVID-19 vaccines. The same technology is now being tested to help fight other diseases.
75,000: In what would be the largest healthcare strike in US history, 75,000 workers at care provider Kaiser Permanente are threatening a three-day walkout as of Wednesday. While the company said hospitals and ERs would remain open, patients might see longer wait times and delays in lab work.
100,000:Over 100,000 ethnic Armenian refugees have fled to Armenia from Nagorno-Karabakh after Azerbaijan retook control of the territory. The UN has called for international assistance, and Armenia has asked the European Union for shelter assistance and medical supplies.
10: Flights resumed from Libya to Italy after a 10-year hiatus due to a ban imposed by the European Union. Medsky Airways is now offering twice-weekly service from Tunis to Rome, though it is unclear how it is getting around the EU ban that is still in force.
96: India is extending the deadline to Oct. 7 to cash in its 2,000 rupee notes, 96% of which have been returned to the national treasury. The bills, worth an estimated $24, were introduced in 2016 during a campaign to demonetize the economy in which higher-value notes were discontinued.
Rwandan President Paul Kagame attends the lighting ceremony of the Rwandan genocide flame of hope, known as the "Kwibuka" (Remembering), to commemorate the 1994 Genocide at the Kigali Genocide Memorial Center in Kigali, Rwanda April 7, 2023
Hard Numbers: Rwanda’s Kagame will run again, the EU takes on Uber, water contamination threat in Libya, US Fed keeps cool
4: Rwanda’s President Paul Kagame, who has been in power since 2000, announced that he’ll run for a fourth term in next year’s election.
Kagame, who has been accused of cracking down on the opposition, tweaked the constitution back in 2015 to extend presidential term limits. Asked about what “the West” might think of his move, Kagame, didn’t mince words: “What these countries think is not our problem.”
40: A top Uber executive has warned that an EU proposal to classify gig workers as employees could boost ride prices by as much as 40%. Brussels says Uber should provide more job security and benefits for its employees. Uber, which has come up against similar battles in Spain, the UK and elsewhere, says the measure will hurt consumers and lead to “devastating” job losses.
4,000: Over a week after a catastrophic flood tore through two dams in eastern Libya, killing 4,000 people (while 9,000 remain missing) the UN has warned that sewage is contaminating water supplies, raising the specter of waterborne diseases like cholera, diarrhea, and hepatitis.
5.25-5.55: The US Federal Reserve held interest rates steady at 5.25-5.55, still the highest level in more than two decades after 11 rate hikes beginning in March 2022. The decision gives policy makers some breathing room to plot their next moves amid subsiding inflation. Still, with price growth well above the Fed’s 2% target, rates could stay above 5% well into 2024, analysts warn.Correction:Yesterday, we incorrectly stated that the Fed's pause was the first in 18 months. The Federal reserve also paused rate hikes in June, 2023. We regret the error.
UN mobilizes to help disaster-stricken Libya and Morocco
First, there was the devastating earthquake in Morocco. And then, cataclysmic flooding in Libya. Recent natural disasters in northern Africa have shocked the world. They've also mobilized United Nations rescue and support teams, says UN Secretary-General António Guterres in an exclusive GZERO World interview.
“We have a central emergency response fund, and we mobilized $10 million to support the operation in Libya," Guterres tells Ian Bremmer. "We are discussing, with Moroccan authorities, our best way to support them...We'll be doing everything to mobilize international community to support these two countries in this very, very tragic situation."
What role can the United Nations play in these devastated zones, and how much is a warming planet contributing to recent climate catastrophes?
For the full interview, tune into GZERO World with Ian Bremmerat gzeromedia.com/gzeroworld or on US public television. Check local listings.