Brazil's representative at the International Monetary Fund, Paulo Nogueira Batista, made waves this week when he loudly criticized the latest round of international funding for Greece. Nogueira Batista reportedly abstained when the fund's executive board approved the latest installment of the IMF loan package. Now the story gets more complicated. The Financial Times is reporting that Nogueira Batista wasn't authorized to take the position he did (h/t Oliver Stuenkel):
Brazil reversed its hardline stance on Greece’s bailout on Thursday, saying it had not authorised its representative to the International Monetary Fund to withhold support for the latest aid to Athens.
Guido Mantega, the country’s finance minister, said it was a “mistake” for Brazil’s representative, Paulo Nogueira Batista, to abstain on the €1.8bn tranche of aid. Mr Mantega said he fully supported the IMF’s efforts to supply financial aid to Greece.
“[Mr Nogueira Batista] did not consult the government, nor was he authorised by us to vote in this manner and the finance minister has ordered him to return to Brazil immediately to explain himself,” Brazil’s finance ministry said on Thursday.
The article speculates that Brazilian bureaucratic politics may explain the dramatic volte-face, but it's also possible that the IMF's odd system of national representation is to blame. Most executive directors on the fund's board represent groups of countries. While selected by Brazil, Nogueira Batista actually speaks for -- and, in theory, takes direction from -- a group of countries that includes Ecuador, Haiti, Panama, and the Dominican Republic. Only the United States, Japan, Germany, France, China, Russia, and Saudi Arabia have executive directors of their own.
One of the first substantive moves by the U.N.'s intervention brigade in eastern Congo has been to create a weapons-free zone around the region's leading city. As the BBC reports:
A statement by the UN mission in the DR Congo, Monusco, has given everyone in Goma and surrounding areas until 1400 GMT on Thursday to hand in their weapons to the city's UN base, warning that anyone caught after this would be considered a rebel.
"They will be considered an imminent threat of physical violence to civilians and [UN mission in DR Congo] Monusco will take all necessary measures to disarm them, including by the use of force in accordance with its mandate and rules of engagement," the statement read.
Only soldiers will be allowed to carry weapons, it adds.
While several news accounts are presenting the exclusion zone as an ultimatum to the M23 rebels, it's not at all clear that it is. As the BBC account acknowledges, the M23 rebels who have attacked Goma before do not have the bulk of their forces within the declared zone. This Reuters report suggests that only a few pockets of the M23 are within the exclusion zone, and the U.N. denies that the policy is aimed at any one group:
MONUSCO said on Wednesday the security zone operation would not amount to an offensive targeting a specific armed group.
"This zone is to protect civilians," said Lieutenant Colonel Prosper Basse, MONUSCO's military spokesman.
Another U.N. source told Reuters the operation would try to clear up small pockets of M23 fighters who remained near Goma after the rebels were pushed several kilometers further north during recent clashes.
An M23 spokesperson insists the exclusion zone doesn't apply to it:
Amani Kabasha, a civilian spokesman for M23, said he didn't believe the new policy would apply to the rebel group. He said that because M23 had agreed to peace talks with Congo's government, rebel leaders considered themselves to be partners of the government and welcomed the disarmament plan "with joy."
"MONUSCO can attack armed groups that spread terror here, indeed it is long overdue," Kabasha said, using the U.N. peacekeeping mission's acronym. "I do not think we are affected by this measure because we are the partners of the Congolese government in making peace."
So, in effect, the U.N. may be asking residents of Goma to turn over any weapons they possess even as a key threat to their safety remains at large. As this Guardian account explains, the U.N. faces a steep climb to credibility with civilians in the area. Absent concrete evidence of the U.N.'s ability to confront armed groups and defend civilians in danger, this initiative runs the risk of exacerbating that cynicism.
More: Via Twitter, Laura Seay has some thoughts on the strategy.
This Reuters piece gives the impression that the NATO alliance is putting the final touches on its post-2014 Afghanistan plan:
U.S. Air Force General Philip Breedlove, who took over as NATO's Supreme Allied Commander Europe in May, said NATO was at an advanced stage of working on a detailed operations plan, or "O" plan, for the post-2014 mission.
"The 'O' plan is very mature, minus a few key pieces (of) which the elephant in the room is the actual numbers and types of forces to be put into the 'O' plan," Breedlove told a group of reporters at NATO's operational headquarters in Mons, Belgium.
"We are still waiting (for) some details from some of the nations in order to absolutely finalize this but we are hoping to deliver this 'O' plan in the latter fall and I think we are within striking distance," he said.
Reading between the lines, it's not hard to see that in fact the alliance's entire post-2014 strategy in Afghanistan remains up in the air. As Breedlove suggests, the number of forces from key members -- and the United States, in particular -- remains unresolved. And as long as that element is missing, it's very hard to see how the organization can have a meaningful strategy.
UNAMA documented 1,319 civilian deaths and 2,533 injuries in the first half of 2013, marking increases of 14 per cent in deaths and 28 per cent in injuries over the same period in 2012. This rise reverses the decline observed in 2012 and suggested a return to the trend of 2011 when high numbers of civilian deaths and injuries were documented.
The report attributes 74 per cent of all civil casualties to actions taken by Anti-Government Elements, a rise of 16 per cent over the same period last year 2012. Pro-Government forces were found responsible for nine percent of casualties, 12 per cent of the casualties were unattributed and resulted from ground engagements between Pro-Government Forces and Anti-Government Elements and the remaining five per cent were unattributed, resulting mostly from unexploded ordnance. The annual report prepared by UNAMA has been documenting the deaths and injuries of non-combatants since 2007.
Taliban representatives are taking issue with how the U.N. defines civilians. Via the New York Times:
The Taliban, for its part, rejected the report as little more than a tool of the American strategy. In addition to denouncing the coalition’s responsibility for innocent Afghan deaths, the group took issue with what it viewed as the United Nations’s use of the word civilian to describe government employees, like judicial workers.
“Calling them civilians is Unama’s own judgment,” the statement said, referring to the United Nations Assistance Mission in Afghanistan. “We don’t consider people civilians who are directly involved in our country’s occupation.”
The European Court of Human Rights (ECHR) has agreed to consider a second case against Poland over allegations it allowed the CIA to run a secret jail on its soil, intensifying pressure on Warsaw to reveal how closely it was involved in the U.S. "war on terror".
The Strasbourg-based court will consider an application from Saudi-born Abu Zubaydah, who alleges that he was held illegally about a decade ago in a CIA-run facility on the grounds of an intelligence training academy in a Polish forest.
His case will be considered alongside one brought earlier by Saudi national Abd al-Rahim al-Nashiri, who says he was held in the same place as part of a CIA program of "extraordinary rendition" to detain and interrogate suspected al Qaeda operatives.
In 2012, the ECHR ruled that the government of Macedonia had to pay damages to Khalid El-Masri, a German national who was arrested (mistakenly) by the authorities and handed to the United States. He spent several months detained in Afghanistan, where he was allegedly tortured.
Justin Lin, the World Bank's chief economist between 2008 and 2012, thinks the growing gloom about China's economy is misplaced. And the Chinese government is making sure that everyone knows that he feels that way. The FT has an account here of the press conference the government arranged to feature Lin's sunny view:
Former World Bank chief economist and senior adviser to the Chinese government Justin Lin has criticised widespread pessimism among economists and investors about the outlook for the world’s second-largest economy and predicted it would grow between 7.5 per cent and 8 per cent for the next 20 years.
Mr Lin’s comments come amid rising alarm at China’s slowing growth, which appears to be on track for its poorest performance since 1990. That year the country was facing international sanctions in the wake of the 1989 Tiananmen Square massacre. The lowest rate of growth since then was 7.6 per cent in 1999...
Mr Lin was speaking to journalists at a briefing arranged by China’s foreign ministry. The setting for his comments suggested that Beijing is hoping to balance a flood of pessimism in the market over the state of the economy.
Lin's former employer is significantly more concerned about China's economic trajectory.
Congressman Sandy Levin--a key player in the House of Representatives on trade--offered his perspective yesterday on the blockbuster trade negotiations underway, including the Trans-Pacific Partnership and the proposed U.S.-EU deal. Along the way, he made some pointed remarks about currency manipulation:
[W]e need an enforceable obligation to avoid manipulating exchange rates. The IMF already prohibits currency manipulation and has done quite a bit to define what actions constitute currency manipulation. The problem is that the IMF lacks an enforcement mechanism. We need to take the disciplines that have been developed at the IMF, build upon them, and subject those disciplines to binding dispute settlement – more or less the same dispute settlement mechanism that applies to the other obligations in the agreement.
Former IMF chief economist Simon Johnson--who worked on currency issues at the Fund-- thinks Levin's ideas should be taken seriously:
Mr. Levin proposes to establish a panel, as part of the Trans-Pacific Partnership Agreement, that would determine if currency manipulation has taken place. (Trade agreements typically include similar mediation mechanisms, but it would be innovative to do this for currency manipulation.) Relying on the I.M.F. or the United States Treasury to make a currency manipulation determination in the past has not worked, primarily for political reasons.
If a country manipulates its currency to gain an unfair advantage, the tariff on its goods and services sold to the United States would rise back to the level that would have existed without the free trade agreement, Mr. Levin proposes. In other words, it is just the additional perceived benefit of the proposed reduction that is on the table in the Trans-Pacific Partnership Agreement or any other free trade proposal.
The question of how international rules could be tweaked or reinterpreted to punish currency manipulation has preoccupied a number of experts recently. In a 2012 paper, Gary Hufbauer and Jeffrey Schott sketched an idea for cooperation between the World Trade Organization and the IMF on the currency question:
A member country...could lodge a complaint against another member country when it perceives that the second country's currency has been seriously undervalued against a relevant basket of currencies for a prolonged period. This would trigger a request from the WTO director-general to the IMF managing director to conduct a staff review of the currency in question.
Fred Bergsten surveyed that option and several others in a major May speech. But Bergsten concluded that the chances of formal change to IMF or WTO rules are slim and suggested that reforming multilateral instruments may ultimately require unilateral action. "As with most systemic change," he said, "it may be necessary for one or several major countries to break some crockery to galvanize serious consideration of the issue and launch the multilateral reform process."
World Bank president Jim Kim has signaled several times that he wants the institution he leads to become less risk-averse. In leaked internal documents, he has lamented an internal "culture of fear" that prevents initiative and stifles imaginative responses to poverty. It appears that his campaign to change the Bank's culture continues; Bloomberg reports today on a new instructive to staff encouraging risk-taking:
In an e-mail to staff obtained by Bloomberg News, Kim said the lender will undergo a series of organization changes including instituting a set of “global practices,” installing a new framework for country partnerships that shifts the focus “from instruments of our engagements to the impacts,” and making a “series of improvements in areas of leadership, people and talent.”
He also said the bank needs to make “significant progress on culture.” Under the new system, employees would be encouraged to “not let excessive risk-aversion get in the way of supporting high-risk/high-reward operations with potentially transformational results.”
It doesn't appear that Kim has precisely identified the wellsprings of the fear he has diagnosed. There are multiple potential sources. The Bank ultimately responds to its largest shareholders, who often have divergent views about Bank strategy. Several large powers, including Russia, Brazil and China, have kicked up a fuss about one of the Bank's best-known publications, the annual Doing Business report. At the same time, Bank staff have to work with "client" governments to implement projects. Some of these governments have other options in financing, and the Bank must tread carefully to avoid grievously offending its clients.
But it seems likely that there's another source of fear: criticism by influential non-governmental organizations and activist groups. In his 2004 book on the Bank, excerpted as an FP article here, Sebastian Mallaby documented the way that these groups can tie up worthwhile Bank projects:
[P]rojects in dozens of countries are similarly held up for fear of activist resistance. Time after time, feisty Internet-enabled groups make scary claims about the iniquities of development projects. Time after time, Western publics raised on stories of World Bank white elephants believe them. Lawmakers in European parliaments and the U.S. Congress accept NGO arguments at face value, and the government officials who sit on the World Bank's board respond by blocking funding for deserving projects.
The consequences can be preposterously ironic. NGOs claim to campaign on behalf of poor people, yet many of their campaigns harm the poor. They claim to protect the environment, but by forcing the World Bank to pull out of sensitive projects, they cause these schemes to go ahead without the environmental safeguards that the bank would have imposed on them. Likewise, NGOs purport to hold the World Bank accountable, yet the bank is answerable to the governments who are its shareholders; it is the NGOs' accountability that is murky.
It's telling that the report of Kim's renewed call for boldness comes in the same week that Human Rights Watch released a major report chiding the Bank and as environmental groups have been scrutinizing the Bank's new energy policy. Jim Kim has been outspoken in urging a less cautious Bank. But is he manifesting that same caution by not explicitly identifying the Bank's demons?
David Bosco reports on the new world order for The Multilateralist.