with periods of relatively fast growth followed by deeper and longer
recessions.
He concludes:
In short, the Matthew effect is (still) operating with vengeance (“To
him that hath shall be given, to him that hath not shall not be given”).
There is deep irony here, related to the impact of the post-Bretton-Woods
architecture on the lives of the poor.
Both the IMF and World Bank are experiencing what has been termed a “crisis
of relevance” when faced with the rapid and fundamental changes that have occured
in the market over the past two decades. Their traditional “products” – economic aid
packages and policy advise to governments – are increasingly questioned as being
outdated, targeted towards an earlier period of global economic development and are
now subject to competition from a variety of new actors. These include global
private foundations like the Bill and Melissa Gates Foundation and private banks.
There has even been discussion to establish a similar institution to support the
developing economies of Latin America, for example:
Finance ministers from seven South American countries met in Rio
de Janeiro on 8 October to discuss the future structure, leadership and
funding sources for the so-called Banco del Sur (Bank of the South).
Already, the idea of an alternative funding source for South American
countries has been supported across the region … Once inaugurated, the
multilateral financial institution will become an alternative to the World
Bank, the Inter-American Development Bank and the International
Monetary Fund for South American countries interested in loans for
social and economic development – loans that come free of the
conditions that South American leaders have associated with the failed
neo-liberal economic policies of the 1990s. (LOGAN: 2007.)
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