FINANCE: 'IMF, WB Themselves Need Structural Reforms'

Civic society organisation members attend a plenary session at Batam, Indonesia. (Credit: Bank Information Centre)

The recent brouhaha over Singapore's hard-line stance against civil society organisations' participation in the International Monetary Fund/World Bank annual meetings, held on Sep 19-20, 2006, elicited a public backlash from all over the world.

Singaporean Felix Tan tells Gerald Goh of Asia Media Forum how the recent meetings "harmed Singapore's global image", as well as his views on Singapore's 'totalitarian' image, the implications of the state's rigid policies, and the impact of the meetings in this age of globalisation.

Tan is pursuing post-graduate studies in International Relations at the Institute of Defence and Strategic Studies at the Nanyang Technological University in Singapore.

AMF: What is your overall assessment of the just-concluded 2006 IMF/WB annual meetings?

I believe they (IMF/World Bank) are going forward in the right direction. . . .But one should really look at the mechanics and the process in reaching this decision. To expect the IMF/World Bank to try and alleviate or reduce international poverty is a long shot indeed! I do not believe, given the lack of proper structural reforms, there can be any manner in which these two institutions can, and will, be able to tackle such an issue.

AMF: So you're saying you are not optimistic about the resolution of many pertinent issues hounding the region?

I do not think these issues will be resolved in just one meeting. We have to understand that the IMF/WB holds meetings annually and nothing substantial have come out of these meetings. The only difference is that once every three years, the meeting is held at a location that is not the United States. . . . Over the span of its history, there have been more mistakes than successes.

AMF: Did the annual meetings help or hinder Singapore, both short-term and long-term?

The IMF/WB need to look closely at their original agenda. There are certainly more important issues that the IMF/WB should be tackling, rather than focusing on how many non-governmental organisations have been allowed into Singapore.

I believe that what happened during the meetings harmed Singapore's global image, at least in the short-term. It demonstrated how rigid the laws are in Singapore and probably showed how apathetic Singaporeans are with relation to societal issues. However, I do not believe there would be any long-term problems here. The inflexibility of Singaporean law is not something new. Institutions or organisations that have hosted their meetings here in the past knew what they were getting themselves into.

What mattered most to Singapore was that it showed to the world it had the capability and capacity to handle such a situation.

AMF: How do you think the world will view Singapore's softening on its hardline stance against the civil society organisations (CSO) during the meetings?

I think that some of the CSOs were right in saying that Singapore's actions were "too little, too late".

For one, it was really a step backward for Singapore to actually negotiate and compromise on its legal system to accommodate the IMF/WB. It only shows who is really in control. A little pressure from a huge institution reflects the kind of manner in which the IMF/WB will extend its power to make a point. It is a real embarrassment for Singapore as well as for its legal system.

Singapore had a responsibility to ensure that the safety of its citizens, as well as to make sure that the IMF/WB meetings was carried out as professionally as possible. The blanket ban on outdoor protests could be seen as quite a draconian measure by some, but it was nevertheless a necessary measure.

AMF: What are your thoughts about some opposition groups' attempts to stage protest actions during the meetings?

The attempted protests by Singapore Democratic Party chief Chee Soon Juan were really overrated. He did not have a clear-cut agenda and the way in which he held the protest was not only provocative in nature, but also irked many people. There are more credible opposition members in Singapore that will probably use the appropriate channels to voice their dissatisfaction over a range of issues.

AMF: Do you think the current IMF/WB policies are helpful in reducing international debt, particularly that of Third World countries?

Whether the IMF/WB succeeds in reducing debt really depends on the structural reforms that the two institutions are ready to make. Given the increasing number of voting countries within the IMF/WB framework, certain policies may have a larger role to play in the near future. What the IMF and/or the World Bank need to seriously consider are the political, economic and cultural differences that each country - developing or under-developed - possesses.

With the intention of increasing the number of voting rights to some nations, such as China, South Korea and Mexico, we might be able to see them play a more important role in reducing international debt. One has to bear in mind the number of poor countries has risen since the IMF/WB's inception - how far the IMF/WB can stop this increase depends very much in structural reforms from within the institutions.

The IMF/WB need to have a better understanding of the different countries they are dealing with in order to seriously help them get out of their debt. There is no ‘one-size-fits-all' model that can be used here.

AMF: Why do you think so many people are fervently opposed to the brand of globalisation the IMF preaches?

Because the IMF has failed to instilled market confidence in the countries they are helping. The IMF is widely seen as U.S.-centric - catering for and benefiting only the Americans and their allies. There have been no attempts by the IMF to change its policies when dealing with different nations, different scenarios and vastly different cultural context. Their ‘one-size-fits-all' policy has been criticised many times over.

Looking at the way the IMF/World Bank dealt with countries like Thailand, South Korea and Indonesia during the Asian Financial Crisis, it is no wonder that so many people fervently oppose what the IMF recommends. Moreover, their efforts to engage NGOs and CSOs are, in effect, just paying lip service.

There must be a strong leadership running a huge institution like the IMF or the World Bank. . . . Or are they just sticking to old, outdated methods that are completely useless in this day and age? I believe the conclusion is obvious.