International Financial Institutions and the Discourse on Good Governance: Case Study of Pakistan an

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International Financial Institutions and the
Discourse on Good Governance Case Study of
Pakistan and Bangladesh (tentative )

• Sadia Naz, PhD Candidate in Political
  Science/Political Economy
• Carleton University, Ottawa Canada
• snaz_at_connect.carleton.ca

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International Financial Institutions (IFIs)

• International Monetary Fund (IMF)
• World Bank (WB)
• Asian Development Bank (ADB)

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Good Governance

• There are more than 100 indicators of GG but
  significant and often mentioned are
• Transparency
• Accountability
• Efficiency
• Fairness
• 
  IMF 1997

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IFIs and Good Governance

• Good governance is important for countries at
  all stages of development. . . . Our approach is
  to concentrate on those aspects of good
  governance that are most closely related to our
  surveillance over macroeconomic policiesnamely,
  the transparency of government accounts, the
  effectiveness of public resource management, and
  the stability and transparency of the economic
  and regulatory environment for private sector
  activity.
• Michel Camdessus
• IMF MANAGING DIRECTOR
• Address to the United Nations Economic and Social
  Council, 1997

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(cont)

• Traditionally the IMFs main focus has been on
  encouraging countries to correct macroeconomic
  imbalances, reduce inflation, and undertake key
  trade, exchange, and other market reforms needed
  to improve efficiency and support sustained
  economic growth. While these remain its first
  order of business in all its member countries,
  increasingly the IMF has found that a much
  broader range of institutional reforms is needed
  if countries are to establish and maintain
  private sector confidence and thereby lay the
  basis for sustained growth
• Jack Boorman
• DIRECTOR
• POLICY DEVELOPMENT AND
  REVIEW DEPARTMENT (IMF 1997 v).

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Whose Responsibility is Good Governance?

• 4. The responsibility for governance issues lies
  first and
• foremost with the national authorities. The staff
  should, wherever
• possible, build on the national authorities own
  willingness and
• commitment to address governance issues,
  recognizing that staff
• involvement is more likely to be successful when
  it strengthens the
• hands of those in the government seeking to
  improve governance.
• However, there may be instances in which the
  authorities are not
• actively addressing governance issues of
  relevance to the IMF. In
• such circumstances, the staff should raise their
  specific concerns
• in this regard with the authorities and point out
  the economic
• consequences of not addressing these issues (IMF
  1997 3).

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IMF and GG

• IMFs main contribution to improving governance
  in all countries will continue to be through
  support for policy reforms that remove
  opportunities for rent-seeking activities and
  through sustained efforts to help strengthen
  institutions and the administration capacity in
  member countries (IMF 1997 6-7).
• Is private sector above the rent-seeking
  behavior?
• Does corruption prevail only in the public
  sector?

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Good Governance Discourse

• Beginning in the late 1990s (post cold war era)
• Shift from Governments to Governance
• Includes the governments but allows an active
  role to be played by the civil society actors and
  international actors (non-elected bodies)
• Concerns over corruption , mismanagement, lack of
  transparency and accountability
• Increasing skepticism of strong governments
• Good governance does not require a weak state
  but a strong state - a state that is conducive
  to liberal economic system
• Belief in the competitive free market system
• Poor Governance vs. Good Governance

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Good Governance and Democracy

• The discourse assumes GG and democracy to be
  compatible
• GG is the means to a more democratic polity,
  economy, and society
• Private sector important pillar of democracy

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Theory and Practice

• Modernization Theory shift from traditional
  society to modern societies, stages of economic
  growth
• Democracy - characteristic of modern capitalist
  societies
• Modern society - new associations (shift from
  traditional top-down hierarchy (religion, God)
  with the state coupled with transformation of
  culture, traditions, social values (religious to
  secular relations), etc
• Modern politics state, political institutions,
  political parties, competition among social (and
  economic) elites, elections, etc
• Modern economy shrinking of public sphere,
  expansion of private sphere (private to be
  pro-society (trickle-down effect))
• capitalism, modernization
  democracy

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Pakistan and Bangladesh

• Pakistan
• IMF membership in 1950
• First structural adjustment program (SAP) in 1988
• Since 1988, Pakistan has had four (?) elections
  (1988, 1990, 1993, 1997, coup 1999, 2002
  election)
• Military is a powerful actor in economic
  management
• Formation of Privatization Commission
• Telecommunication, energy, banking, etc
• Removal of all subsidies by the end of 2008
• Crises in Pakistan Political, Economic, Social
  (and judicial)
• Political instability or consolidated democracy?

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Bangladesh

• First SAP in 1986
• Economic reforms
• Privatization Board (privatization of POEs)
• Energy, telecommunication, banking, currency
  flexibility
• Elections
• Political instability/ social conflict or
  consolidated democracy?

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Methodology

• Gramscian political economy
• Discourse analysis (common sense, high culture,
  education, media)
• Poststructuralism
• Constructivism

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Data, Methods

• Data on
• military budgets
• Deficit financing
• Privatization of POEs
• Police forces
• Elections and re-elections
• Frequency of Regime changes
• IMF, WB and ADBs docs on GG
• Methods
• Archival research on Pak and BDs economic
  development
• Newspapers, books, interviews
• Etc.