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Strong Leadership in the Developing World Vital to Cut Poverty

Strong leadership in the developing world was a vital key to success in reducing poverty around the globe, World Bank President Paul Wolfowitz said.

In a speech marking the official opening of the World Bank and International Monetary Fund annual meetings in Washington, Wolfowitz also called for stronger coordination among the development community, as well as donor nations, to help cut poverty.

For his first address to the annual meetings, Wolfowitz drew on the words of a former strong leader – Nelson Mandela – urging not only the development community but all countries to help turn Mandela's call to "make poverty history" into reality.

Wolfowitz told how he'd stood with 50,000 young people the night before the July meeting of the G8 group of industrialized nations in Gleneagles – a meeting which resulted in a pledge to double aid to Africa and cancel the debt of the poorest countries.

"All eyes were riveted on the man who appeared on the giant video screen -- the father of South Africa's freedom.  And the crowd roared with approval when Nelson Mandela summoned us to a new struggle - the calling of our time - to "make poverty history."

Wolfowitz said the call to end poverty reached across generations, continents and nationalities, spanning religious, gender and politics.

Urgent need for action

"Anyone who faced the facts would agree there was an urgent need for action. Every day, thousands of people living in extreme poverty, many of them children, die from preventable diseases," he said. 

"The scale of death and deprivation in Africa is particularly alarming.  Since 1981, the number of Africans living on less than $1 a day has nearly doubled from 164 million to 314 million.

"But much can be done to help people escape from poverty, to save lives and to create hope."

However Wolfowitz said while strong leadership was vital, it alone was not enough to defeat poverty.

"Development is a team sport, so leadership is not a matter of individual performance; it must stand on bedrock of trust, respect and teamwork.  As Nelson Mandela told me, real leadership requires understanding, that you're not acting as an individual, that you represent the collective.  

Or, as he also put it plainly many years ago, "There's no limit to what you can achieve as long as you don't give a damn that gets the credit."

Accountability is vital

Wolfowitz said effective leaders also recognized they were accountable to their people.

"Effective leaders listen. Institutions of accountability like civil society organizations (CSOs) and a free press help leaders listen, hold them accountable for results and are key to controlling corruption.

"Corruption drains resources and discourages investments. It benefits the privileged and deprives the poor. It threatens their hope for a better quality of life and a more promising future. "

Wolfowitz described civil society organizations as the "engine of growth and instruments of opportunity" and said they contributed to accountability by providing an important bridge between citizens and their governments.

Empowering women

"And civil society organizations are important for empowering women, a key factor in successful growth.  As one poor woman told me in Pakistan, "Development is like a cart with two wheels—one man and one woman. If one of the wheels doesn't move as fast as the other, the cart will not go forward."

Wolfowitz said millions of women had benefited from vigorous CSOs like the Bangladesh Rural Advancement Committee and the Grameen Bank, which provide small loans to help them start businesses.  The profits from these businesses are being used to send children, especially daughters, to school.

He said sustained economic growth – essential for development and reducing poverty – depended not only on leadership, accountability, civil society and the rule of law but also on the private sector, labor and capital.

Greater emphasis 

And in line with that, Wolfowitz pledged a greater emphasis by the Bank on health, education, energy, infrastructure and agriculture.

 Wolfowitz described the private sector as an "important engine of growth and job creation."

And he pledged the Bank would explore new ways to allow small and medium businesses to access credit.

"One of the biggest obstacles to growth of small and medium businesses is lack of credit.  The Bank has provided sound policy advice to support micro-lending, but we must explore innovative ways to expand access to financial services, including both local and regional needs and approaches," he said.

Education funding

On education, Wolfowitz said the Bank through the Education for All Fast Track Initiative, the Bank planned to join other donors to double the enrollment of girls in 60 countries over the next five years. 

"We have a plan.  Now we need the resources. We will need to raise at least $2.5 billion per year to fulfill the dreams of thousands of school children eager for a brighter future," he said.

Wolfowitz also pledged to deliver results on the Bank's commitment to increased spending on malaria.

He said when 3,000 African children died of malaria every day, the Bank must act.

"In Africa, the World Bank will commit $600 million over the next three years to a new "Booster Program" to control malaria.  We have set clear targets for ourselves:  we will make bed-nets available so that 60 percent of the population will be covered; and within 24 hours of symptoms, 60 percent of the population will have access to treatment."

Call for infrastructure

Since taking over the Bank presidency, Wolfowitz said one clear persistent message he'd heard from people in developing countries was the need to restore the Bank's role in infrastructure investment.

He described infrastructure as the lifeline to many other things - to health care, education, jobs and trade.

"We will not see an end to poverty when 90 percent of businesses in Nigeria rely on backyard generators for power.  We will not see incomes grow when poor Latin American farmers have no roads to transport their produce to market.  And we will not see improvements in health as long as more than 1 billion people lack access to clean water.

"But in addressing these infrastructure challenges we need to learn the right lessons from past mistakes.  Intelligent management of a country's natural resources are essential to ensure that short term gains are not made at the expense of long term health of the poor and the environment, " he said.

Wolfowitz also pledged the Bank would investigate innovative use of new technologies to promote energy and sustainable development.

"We will strengthen our cooperation with middle income partners like Brazil, China, India, Mexico and South Africa who face an increasing demand for energy.  The goal is to achieve a new, more climate friendly development path, that meets the energy demands of the developing world.

Helping middle income countries

Wolfowitz said the bank would not overlook the middle income countries – home to more than one billion people living in extreme poverty.

"We must not forget them.  To help the middle income countries grow and prosper, we need to continue to tailor our knowledge and financing to their specific needs.

And while signaling a greater focus on agriculture, the World Bank leader also called for a successful outcome at the next Doha Round of trade talks in Hong Kong to bring an end to agricultural subsidies which "distorted prices and restricted market access for poor farmers."

Potential in Africa

Wolfowitz said the hardest work for the World Bank Group and other donors lay in Africa.

"With staggering needs in education, nutrition, clean water and sanitation, healthcare and jobs, the challenges are daunting.

"Nonetheless, I am hopeful. As Nigeria's President Obasanjo said to me in June, "Africa is a continent on the move".

"If we can liberate the energies of the African people and unleash the potential of the private sector to create jobs, Africa will not only become a continent of hope, but a continent of accomplishment."

But Wolfowitz said the international efforts to end poverty did not lay solely with the developing world.

He said it was now clear Africans were stepping up to their responsibilities and taking charge of their future.

"But the responsibility cannot be left to the developing world alone. At Gleneagles, a partnership was forged between Africa and the G-8 countries—a partnership designed to deliver results.  Those partners pledged performance for assistance."

Wolfowitz said whether investing in education, health, infrastructure, agriculture, the environment, the World Bank must be sure to deliver results.

Team effort

"And we must remember we are but one player in this global effort, which must be guided and defined at the country level.  We must remember that we are part of a team.

"In Rwanda, I had the privilege of meeting Dr. Agnes Binaghwaho who heads the National AIDS Council.  She told me with great pride that if a man shows up at a clinic, he is sent to bring his wife and children before he can receive care.

"Dr. Binaghwaho stands her ground on another equally important point. She politely but firmly insisted that Rwanda's donors support one integrated health plan - - - no more special interest spending, she says."

Wolfowitz said by asking for better coordination in assistance to improve results, Dr Binaghwaho and her small medical team wasted less time with donors and spent more time saving lives. 

"Expanding country coordination will demand greater participation from Bank staff in the field.  We must continue efforts to decentralize our team; moving more of the right people to the field will better serve our partners' development needs.

"And by results, let me be clear. I mean results that have a real impact in the day-to-day lives of the poor. We stand accountable to them for these results," Wolfowitz said.

(China.org.cn September 27, 2005)

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