International Socialist Review Issue 11, Spring 2000 Chronology of the World Bank 1944, USA: Founding of the World Bank and the International Monetary Fund at Bretton Woods, in the presence of delegations from 44 countries. 1947, Indonesia: The Netherlands receives loans from the Bank while simultaneously putting down the Indonesian independence struggle with 100,000 troops. 1960, Washington, D.C.: The International Development Association (IDA) is created as part of the World Bank Group to obtain low interest loans for the poorest countriesóagainst the objections of Third World governments who want a separate institution for this purpose. 1964, Thailand: The Bank finances the Bhumibol hydroelectric dam, whose construction leads to the forced displacement of more than 3,000 people. These people have yet to receive appropriate compensation. 1964, Brazil: Having refused to provide loans to the democratically elected Goulart government, the Bank now offers significant financing in the wake of a military coup. These loans grow by leaps and bounds until the mid-1970s, by which time they total some $500 million per year. 1965, South Africa: The apartheid regime receives loans from the World Bank in spite of UN resolutions against such aid. The World Bank persists in spite of an open reprimand from UN Secretary-General U Thant. 1968, Indonesia: The Bank begins loans to the Suharto military regime, which came to power through a bloody coup d’etat in 1965 that overthrew the civilian government and killed more than 500,000 people. 1969, Indonesia: The Bank provides financing for the Transmigration Programs. These programs used more than $500 million to shift millions of people to remote and sparsely populated islands. The programs have a devastating effect on the country’s forests. They have a profoundly negative impact on the lifestyle of numerous indigenous communities and cause serious environmental damage. 1970, Washington, D.C.: For the first time, the Bank takes in more money in debt payments than it gives out in new loans. 1973, Chile: The Pinochet dictatorship receives substantial backing from the Bank after overthrowing the Allende government, which had been unable to obtain World Bank funding. 1976, Pakistan: The Bank finances the building of the Tarbeta dam, leading to the forced removal of 300,000 people, who become homeless. 1978, India: The Bank provides $451 million in financing for the Upper Krishna dam, which involves the forced removal of nearly 220,000 people in one of the country’s poorest regions. It has been estimated that the first 100,000 displaced people saw their earnings drop by 50 percent. 1979, Turkey: The Bank makes its first loan within the framework of a structural adjustment program (SAP). 1979, Argentina: The Bank makes the first of three loans totaling more than $1 billion for the building of the Yacyreta hydroelectric dam on the Parana River between Argentina and Paraguay. Both countries are controlled by dictatorships at the time of the first loan, which is squandered before building even begins. Construction lasts more than 15 years. More than 50,000 people are forcibly removed. Corruption is so extensive that former Argentine President Menem has called Yacyreta “a monument to corruption.” 1979, Philippines: The Bank discretely withdraws from a project to build four hydroelectric dams on the Chico River, which would have forced the removal of 100,000 members of the Bontoc and Kalinga tribes. The local population ambushed surveying teams and held mass protests and civil disobedienceóincluding lying down in front of bulldozersóleading Prime Minister Varata to declare in 1981: “One of the four planned damsÖwill not be built because the people are opposed to it.” The experience leads the World Bank to carry out an internal review of policy on minorities threatened by development. 1979, Nicaragua: The Bank suspends all loans to Nicaragua in the wake of the overthrow of the Somoza dictatorship, in place for nearly 50 years. The Bank only resumes loans to Nicaragua in 1992, two years after the electoral defeat of the Sandinistas. 1981, Brazil: ›he Bank’s International Finance Corporation (IFC) invests $8 million in Cobrape, a company in which it is a shareholder, for a rice-field irrigation project. Since 1984, more than 100 families of small farmers have been resisting physical attempts to remove them from their land. In 1987, they persuade a state prosecutor to lodge a complaint against Cobrape for sending men to assault the farmers, destroy fields and property, and force the farmers to sign away their property rights. In 1986, the NGO Comis“o Pastoral Da Terra draws the IFC’s attention to human rights violations. Yet the IFC has never contacted the prosecutor or the affected parties. In 1992, the IFC discreetly withdraws from the project after making investments totaling $4 million. 1982, Mexico: Beginning of the debt crisis, whose effects continue to affect the Mexican people. The crisis turns the World Bank and the IMF into collection agencies for Western governments and private banks. 1982, Ecuador: A series of draconian antipoor measures are taken in response to World Bank pressure. Gas prices are increased by 120 percent; flour subsidies are eliminated; cigarette, beer and automobile taxes are increased; and public transport fares are boosted by 25 percent. Reaction is swift and violent. Ministers are kidnapped; there are strikes in transport, education and, in other sectors, riots. 1984, Zambia: Riots break out in response to the doubling in the price of flour and corn, caused by the elimination of subsidies. Government repression causes 15 deaths. The government is forced to reinstate subsidies. 1984, Tunisia: Riots break out in the south in response to the doubling in the price of bread and semolina. Dozens of people die as a result of the ensuing government repression. The Minister of the Interior is forced to resign, the state of emergency is lifted, bread and semolina subsidies are reinstated and rent control remains in place. 1985, Ecuador: The government increases the price of gasoline by 67 percent and bus fares by 50 percent to reduce the budget deficit. The main trade union calls for a two-day general strike; seven people die in the resulting clashes. Two months later, there is another wave of strikes and demonstrations. President Cordero stays in power thanks to military backing. 1985, India: The Bank provides financing for the Sardar Sarovar dam in the Narmada valley, which threatens to displace 200,000 people. Mass demonstrations and court challenges drag on for years, finally leading to the first independent evaluation of a Bank project. The Morse Commission condemns nearly every aspect of the Bank’s involvement in the Narmada project. 1985, Bolivia: Huge increases in food and gas prices lead to 15 days of strikes and riots. The increases are carried out in line with the structural adjustment program drawn up and financed by the World Bank and the IMF. 1986, Zambia: Hunger riots break out in the copper-belt towns in response to a 120 percent increase in the price of basic goods. President Kaunda declares that the conditions placed on structural adjustment loans are intolerable. 1986, Brazil: A $500 million loan for an electricity project is used to complete a dam that damages the Amazonian rainforest and its inhabitants. 1989, Venezuela: More than 300 people (some place the figure as high as 2,000) are killed during riots against a 100 percent increase in the price of gas and fares for public transport. These increases are part of a package of restructuring measures adopted to satisfy conditions for IMF and World Bank structural adjustment loans. 1989, Ecuador: Further increases in the price of gas and motor-vehicle taxes lead to a general strike of bus and truck drivers. The president calls out the army to operate public transport. In November, there are violent student demonstrations in response to an increase in bus fares. 1990, China: The Bank resumes its loans after an eight-month suspension in the wake of the Tiananmen Square massacre. 1990, Morocco: Violent demonstrations take place in Fez against the implementation of the structural adjustment program. Government forces kill 100 students. Hunger riots have already taken place in Morocco, especially in Casablanca in 1981. 1990-93, Rwanda: The World Bank and IMF finance the Habyarimana dictatorship, which is preparing genocide. The massacres are perpetrated during a three-month period beginning in April 1994. 1991, Honduras: The national electricity workers’ union goes on strike against government plans to privatize the state-owned company and cut staff in line with World Bank and IMF structural adjustment prescriptions. More than 700 workers are dismissed over three months, and the trade union disappears. 1991, India: The Bank and the IMF provide more than $200 million for the construction of a 500 megawatt thermal-power station on territory belonging to an aboriginal community, to provide electricity to Bombay. Local groups take the Indian company to the Bombay High Court and the Indian Supreme Court. 1991, Peru: Prices on fuel and other basic products are massively increased. According to many observers, the poorest sectors of the population of Lima are no longer able to boil their water, leading to new outbreaks of cholera. 1992, Chile: The Bank’s International Finance Corporation (IFC) approves a financial package worth $124.9 million for the Pangue dam on the Bio River, disregarding two years of opposition on the local and international levels. In 1993, more than 2,000 opponents of the dam attend a meeting of seven Pehuenche communities billed as “a symbolic act for the defense of the cultural identity and lands of Chilean indigenous peoples.” In 1995, the Inspection Council of the World Bank rejects a request to inspect the project, saying that IFC projects are outside its jurisdiction. 1993, Worldwide: An international review at the Bank says that 37 percent of the Bank’s projects do not fulfill its own financial criteria and that 78 percent of conditions for loans are not met. Other internal reports concede that more than two million people have been removed by force to make way for Bank finance projects. 1993, China: With human rights violations continuing apace, China receives a total of $3.17 billion in the year, becoming the Bank’s biggest borrower. 1994, Worldwide: Of more than 6,000 loans proposed by the Bank administration since 1947, not a single one has been rejected by the Bank’s executive directors. 1997, East and Southeast Asia: On several occasions, the World Bank and IMF declare in official documents that there is no threat of a serious crisis in Southeast Asia. This does not prevent a crisis from erupting in the summer. The IMF imposes severe austerity packages involving the elimination of millions of jobs and of subsidies for basic goods. South Korea is hit hard by the unfolding crisis. IMF president, Michel Camdessus, declares the crisis to be a “blessing in disguise.” 1998, Rwanda: Rwanda is obliged to repay IMF and World Bank loans made to the former Habyarimana regime (1973-94) to buy arms used in the 1994 genocide. Source: Eric Toussaint, Your Money or Your Life: The Tyranny of Global Finance (London: Pluto Press, 1999).