by Jim Lobe

Washington, 14 Jun 2000 (IPS) -- The lead author of the World Development Report (WDR), the annual flagship of the World Bank’s development policy, has submitted his resignation, apparently to protest pressure by outside forces on the WDR team’s work.

The resignation by Ravi Kanbur, a well-known economist who teaches at Cornell University in New York, comes just three months before WDR 2000, which will be the Bank’s first comprehensive analysis of poverty since the 1990 WDR, is due to be released.

It also comes less than six months after the resignation of the Bank’s last chief economist, Joseph Stiglitz, whose outspoken criticism of the International Monetary Fund’s handling of the 1998-99 Asian financial crisis earned him the wrath of US Treasury Secretary Lawrence Summers.

Kanbur was unavailable for comment Wednesday, but knowledgeable sources said his resignation may also have been due to pressure by some Bank officials and Summers who are reportedly concerned that this year’s WDR would be too critical of IMF- and Bank-sponsored structural adjustment policies and the neo-liberal orthodoxy which underlie them.

“The resignation of the lead author of this flagship Bank report confirms our view that the World Bank is unable to accept dissenting views, whether from insiders or outsiders,” said Alex Wilks, head of the Bretton Woods Project in London. “Coming soon after Joe Stiglitz departed as Chief Economist, this is a major blow for an institution trying to position itself as a ‘knowledge Bank’ and a ‘listening Bank’.”

“It raises questions of who really calls the shots at the Bank and what evidence or opinions about the impacts of globalisation they are trying to suppress,” Wilks added.

The Bretton Woods Project works with UK-based NGOs (including Christian Aid, WWF and World Development Movement) to monitor the IMF and World Bank groups.

“We very much regret his decision to resign,” said Bank spokesperson, Caroline Anstey, who added that the drafting of the annual WDR, perhaps the single most influential policy statement for the global development community, has historically provoked “lively debate.”

“Ravi was repeatedly given an assurance that the WDR would be an objective, analytical report, as it always has been,” said Anstey, “but he himself felt at odds with some other voices in the Bank over emphasis.”

Although the WDR is not an official policy document which must be approved by the Bank’s executive board, it is prepared by the staff of the Chief Economist, as well as outsiders, such as Kanbur and deputy team leader Nora Lustig of the Inter-American Development Bank (IDB), who are invited to take part. Other Bank staff and member governments are also invited to comment on the Report as the team produces successive drafts in a process that actually begins almost two years before publication.

In recent years, the process has become more consultative; indeed, this year, for the first time, an early draft was disseminated in an electronic conference that drew the participation of over 1,500 people from more than 80 countries.

The same draft also apparently spurred concerns by more-conservative forces in the Bank and the US Treasury that the WDR team was giving too much attention to the failures of economic liberalisation and structural adjustment on the one hand and the importance of political, institutional, and other non- economic factors on the other.

“Many people had hoped the WDR this year might break new ground compared to its predecessors and open up debates on issues such as free trade and political disempowerment,” said Wilks.

To many, the first draft of the report raised uncomfortable questions about the impact of adjustment and globalisation on the poor, questions which suggested that economic liberalisation - long considered by both the Bank and the IMF as an indispensable to restoring growth and reducing poverty - may have devastating effects on the most vulnerable sectors.

Coming in the wake of the headline-grabbing Seattle protests against the World Trade Organisation (WTO), the more-conservative forces complained that such an approach, in such an influential publication, would only provide ammunition to anti-globalisation forces in the West and to constituencies in key developing countries where liberalisation is under fire, precisely because of its impact on the poor.

“This is a delicate moment in many countries,” said one source. “If the message is not clear or conveys serious doubt about reforms, it could be seen as part of an anti-reform backlash.”

According to Wilks, Kanbur decided to resign after Summers, a long-time champion of adjustment and globalisation, became directly involved in re-writing the globalisation sections of the report. The Treasury Department had no comment on the matter.

After Kanbur took the WDR job in early 1998, he sent a letter to the Bretton Woods Project which stated: “First and foremost, I want to stress that I would stand behind any Report that I put my name to, and would not submit to any substantive editing I did not agree with.”

To some observers, Kanbur’s decision is the latest in a series of events beginning with Stiglitz’ premature resignation which put into question the Bank’s willingness to tolerate internal dissent from the prevailing orthodoxy.

Last December, senior economists Mattias Lundberg and Lyn Squire circulated a draft of a paper called “The Simultaneous Evolution of Growth and Inequality” which found that the costs of adjusting to greater openness that resulting from trade liberalisation are borne exclusively by the poorest 40% of people in developing countries, regardless of how long the adjustment takes.

That conclusion, according to Nancy Alexander, director of the Globalisation Challenge Initiative here, was missing in the final version of paper published a few weeks ago.

“Their new conclusion is: growth spurred by open trade and other good macro-economic policies benefit the poor as much as other households.  In fact, they now say that the income of the poor rises one-for-one with overall growth,” she said, adding that the “fiasco over the Lundberg-Squire paper had something to do with (Kanbur’s) resignation.”

“All of this shows that even when World Bank economists start to deviate from the orthodoxy themselves, they can only go so far,” said Doug Hellinger, director of the Development GAP and global co-ordinator of the Structural Adjustment Participatory Review Initiative (SAPRI), a joint project of the Bank and non- governmental organisations. “The question now is whether (Bank President James) Wolfensohn has the courage to stand up to this kind of pressure.”

Bank officials, including some directly associated with the WDR team, insist, however, that the WDR itself will reflect Kanbur’s concerns when it comes out just before the Bank’s annual meeting in Prague.

“The WDR that is finally produced in September,” according to Anstey, “will continue to reflect the main themes that were in the draft that has been widely discussed around the world and will incorporate the results of the expansive consultations that took place with civil society, policy-makers, academics and Bank staff.”

[However, other Bank sponsored studies and documents, including one about East Asia, and another (by David Dollar and Ary Kraay) suggest that there is an orchestrated attempt to buttress globalization theories and prescriptive norms for developing countries and to counter the growing academic and NGO advocacy literature that show that current globalization policies are increasing inequities among, and within countries.]