The World Bank and Africa

Graham Harrison

• Publisher: Routledge
• Year: 2004
• ISBN:
  9781134414017
• Edition: 1
• Topic: Politics & International Relations
• Subtopic: Politics
• Index: Politics & International Relations

Shortlisted for the Inaugural International Political Economy Group annual book prize, 2006.

An incisive exploration ofthe interventions of the World Bank in severely indebted African states. Understanding sovereignty as a frontier rather than a boundary, this key study develops a vision of a powerful international organization reconciling a global political economy with its own designs and a specific set of challenges posed by the African region. This analysis details the nature of the World Bank intervention in the sovereign frontier, investigating institutional development, discursive intervention, and political stabilization. Ittackles the methods by which the World Bank has led a project to re-shape certain African states according to a governance template, leading to the presentation of 'success stories' in a continent associated with reform failure.This conceptually innovative book details a political economy of the World Bank in Africa that is both globally contextualized and attentive to individual states. It is the only volume to look at the bank's relations with Africa and will interest all students and researchers of African politics and the World Bank.

Part I
The governance encounter
The World Bank, governance states and a new sovereign frontier

1 The road to governance
The World Bank and Africa

Introduction

Governance states: towards responsibility?¹

The World Bank’s broad mission of promoting development requires it to work actively with a large number of ministries in each developing country–on environment, labour markets, health, education, judicial systems. This in turn necessitates it taking into account a wide range of perspectives. This has become even more true in recent years, as views of development have changed from a more narrow focus on solving certain technical problems, like lowering tariffs, to a broader one of the transformation of society.

(Stiglitz 1999b: F582)

Africa is in the throes of a profound global project of socio-political engineering. This project, commenced in earnest in the early 1990s, goes under the rubric of governance and it encapsulates a set of integrated ideas and specific programmes. Governance can now be said to constitute a historically unprecedented reconfiguration of state forms in post-colonial Africa. The significance of governance reform is enhanced by its international dimensions: even a cursory review of governance in Africa reveals that it is intrinsically related to the actions of international agencies–most notably the World Bank.

Almost all contemporary discussions of development, poverty reduction, sustainability, international financial regulation and democratisation (to name the most salient) in Africa make an acknowledgement to governance. ‘Governance’ itself has become a concept as elastic as it is popular (Frischtak 1994). One effect of the general ascendancy of governance in Africa has been to produce a sub-set of states which have undergone related processes and display certain similar features, mutatis mutandis. These states are conceptualised here as governance states. We will come to look more closely at the defining features of governance states later in this Chapter and in Chapter 3, but for now we can note that they are states which appear to have succeeded in internalising the impetus of governance. As such, they provide a unique and important point-of-departure: an analysis of cases where the governance project has (within the bounds of realistic expectation) succeeded.

But, what do we mean exactly by ‘success’? As is well-known, normative phrases such as ‘success’ are difficult to pin down. What this book argues is that success has a great deal to do with progress towards the resolution of a set of structured tensions generated by a decade of neoliberal reform in sub Saharan Africa during the 1980s. Neoliberal reform–programmatised as structural adjustment–failed to infuse itself into the state as the founding logic of public action; it also generated destabilising effects on African societies. We will argue in coming Chapters that the construction of governance states constitutes an attempt to address these problems through discursive intervention, programme lending focussed on administrative reform and capacity building, and the introduction of new resource management techniques. The World Bank has been the lead institution promoting reform in all these areas. In a phrase, governance states represent the Bank’s² best efforts to embed neoliberalism in Africa.

‘Governance’ has worked to produce governance states in Africa through the articulation of a set of ideas and practices. As such, governance can be understood discursively and programmatically. It is also the case that governance is embedded in a set of global structures of political economy. As such, for all its novelty and effectiveness, governance cannot be analysed within the boundaries of its own dynamics; it operates within a broader conjuncture. Understanding this conjuncture is key to an analysis of governance states principally because the political economy of governance shapes the ontology of specific actors that promote governance reform through discursive and programmatic acts. The production of governance does not require a methodology of functionalist determination, but on the other hand, it would be naïve not to take into account the underlying power relations between groups of states, international agencies, and the structures of class relations more broadly. It will become clear throughout the book that the World Bank in particular has produced much of the impetus behind the production of governance states and it is not excessively vulgar to state that it has done this in large part merely through its ability to dispense hard currency.

How do we define governance? It will become clear that part of the reason why the term has gained such power–even seduction (Abrahamsen 2000: 47 et seq.)–is that it is extremely ‘promiscuous’: it involves itself in a wide range of political considerations. This will become clear in later Chapters. Let us merely ‘establish’ the term with reference to the World Bank’s ambitious definition. Governance involves: a more efficient public administration, the promotion of accountability, the establishment of the rule of law and a capable judiciary, and transparency (World Bank 1994b).This is a very wide-ranging remit. This book focuses mainly on the first component, administrative reform.

To make a brief summary: governance, as a general project of political engineering that has pervaded Africa for at least a decade, has produced a set of governance states out of the varied terrain of the continent. These states have ‘internalised’ core features of governance discourse and practice and have won the plaudits of the World Bank and other international organisations as a result. The aim of this book is to analyse the mechanics of governance states and the interplay of the agencies involved in their construction, most centrally the World Bank, as facets of a project to embed neoliberalism.

This Chapter introduces governance states by situating them within three scene-setting contexts. The two principal ‘players’–the World Bank and African states–are introduced with particular attention paid to the interrelations between the two. The more specific nature of these two players’ encounter during the 1990s is reviewed, as this provides the ‘moment’ within which governance states have been constructed. The section on the World Bank establishes a set of its operating principles that provide us with a basic ontology of Bank agency. The section on African states focuses on the interface between states and the global political economy. The scene setting section details the development of governance politics as a successive phase from the neoliberalism of the 1980s, namely Second Generation Reform (SGR). This contextualisation will leave us in a position to raise the pertinent questions that drive the second section of the book. It will also introduce the more detailed theoretical reflections of Chapters 2 and 3.

Analysing governance states: a précis

Governance states are not hermetically-sealed national institutions, or ‘models’ with a tendency towards equilibrium, and to imagine that they are so would be to ignore important facets of governance states’ features. In fact, governance states constitute a ‘clustering’ of actions and interpellations which render the notion of national sovereignty problematic.³ In this sense, the analysis here does not start with the internal/external divide which has been problematised in International Relations theory for some time now. Governance states are global as much as they are national and, as a result, the narrative here moves from national case studies to global political economy and the politics of the World Bank. It is only within the space produced by these different levels that governance states can be meaningfully situated as we shall see in Chapter 2. This is not an easy ‘space’ to delimit; it is, rather, an international arena where the World Bank and governance states interact–a kind of ‘international public sphere’ (Cooper 2001a; Latham 2001: 73).

Governance states, it will be argued, are produced out of a confluence of forces. But this confluence is not chaotic or ‘decentred’ in its rationale. Rather, governance states represent a manifestation of a grander and profoundly historical problematic: the politics of the encounter between the institutions of global capitalism and African nation-states. Some of this history will be dealt with in Chapter 3 through the history of the World Bank in Africa, so here it is only necessary to sign some of the key issues that derive from the political economy of governance states.

Governance states encapsulate a process of addressing the tensions produced by an increasingly powerful set of global institutions and an increasingly powerless set of states in the African region. As such, governance states are analysed in Chapter 4 as possessing a different relation with donors to that encapsulated by the standard notions of national and global/international interests or internal and external actors. For those sympathetic to the governance project, this is a great step forward, abandoning as it does images of conditionality, external vigilance, and threats to declare a country ‘off-track’ (in the International Monetary Fund’s (IMF) well-known punitive phrase). Chapter 5 details the forms of interventions that the Bank pursues to realise governance reform under ‘post-conditionality’ circumstances. Chapter 6 identifies the underlying liberal articles of faith that produce an image of governance states as harmonious or equilibrating entities. The main source of liberal governance discourse is the World Bank, which has made a strong effort to become an intellectual leader in this and other areas throughout the 1990s and into the twenty first century. But, governance states are not just the outcome of the Bank’s successful liberal mission. In a later section of this Chapter it is suggested that Africa’s encounter with the World Bank has been particularly ‘troubled’ by issues of conflict and civil order. Concerns with order have coloured the nature of the construction of governance states as Chapter 7 will detail. Chapter 8 concludes by reflecting on the prospects for governance states with reference to a model outlined in Chapter 2.

Within all the Chapters of this book, the processes and discourse of governance are ‘concretised’ through reference to specific cases: mainly Tanzania and Uganda, but also Mozambique. These countries do not constitute national case studies in the standard sense, but where necessary allow us a level of detail within our ‘international public space’ of governance, not amenable to a study which works at the more abstract level common to many international relations and international political economy studies. The countries also provide a prism through which the multi-level interactions of governance work: the institutional manoeuvres of ministries, appeals to national development, and the expansive globalised ‘common sense’ of the World Bank and others. The need for specificity is strengthened by the fact that much of the mechanics of governance are worked through a specific kind of political engineering: administrative reform. As we shall see, administrative reform programmes have emerged in all governance states, possess key common features, and allow the most intimate facets of statehood to be evaluated and reconfigured in the name of governance.⁴ However, programmes of administrative reform are not presented here as isolated refuges of ‘proof ‘ against the hubris of governance-speak and political rhetoric; rather the programmes themselves–the logic of their objectives and the language of the documentation that they generate–are highly ideologised. They work to produce governance truly as a political project.

Once more to make a brief summary, governance states will be analysed by addressing the following issues: the strengths and weaknesses of governance as a form of liberal discourse; the collapse of a sovereign ontology of internal/external and the dynamics of donor-state relations and the polarities that this evokes; the origins and rationales of World Bank advocacy of governance; and the construction of governance states as a solution to the enduring instability of markets and production in African states. This requires a focus that moves between different levels of analysis: both generic and specific to certain countries; both focussed on discursive interventions and the funding of ‘real’ programmes of state reconstruction.

The World Bank: foundations of an international institution

As will become clear throughout this book, the World Bank is the key actor in the construction of governance states in Africa. No matter how much emphasis one puts on the ownership of governance reform by African states, it is undeniable that the similarity of governance reforms between states–the reason that one can establish a generic category of governance states–owes itself to the fact that the World Bank has ploughed intellectual and financial resources into governance states, and maintains a powerful and close relation with them. If the Bank is such an important actor–the paramount force behind governance no less–then it becomes necessary to pay close attention to the nature of World Bank action.

Although the Bank’s history reveals an institution that has changed significantly in some ways (Kapur et al. 1997) one can discern a core empirical foundation to the World Bank’s actions since its establishment in 1944. This set of core actions provides a useful starting point to an analysis of the Bank because it provides us with a sense of the Bank as an agency. The three core actions dealt with here are: to expand international capitalism, to promote social change through lending programmes, and to regulate or institutionalise capitalist development; but before proceeding to develop these, a review of some of the existing work on the Bank provides a context and justification for the starting point used here.

The World Bank charter lists five establishing purposes:

1. to assist in development and reconstruction,
2. to promote private foreign investment,
3. to promote long term balanced international trade,
4. to lend for project development,
5. to conduct its operations with due regard for business conditions (adapted from Shihata 1991: 62).

Broadly speaking, most writers (including this one) accept the Bank’s self-representation,⁵ albeit with different emphases between–and interpretations of–the five points. And, most are reasonably comfortable to take some interpretation of these five points as sufficiently robust to endure the turbulent post-1945 political economy: ‘leading up to the Bank’s establishment… a number of ground rules were laid down which still govern its activities today’ (van der Laar 1980: 32).

To identify a set of core actions is not to portray an unchanging international institution, a rock standing indifferently to the turbulent waters of global change. Rather, it is to take a reasonable starting point to an analysis of the World Bank, to serve as a reference against which changes in Bank actions and discourse have taken place. Also, of course, the relative strength that one gives to each of the five points and the justifications one might evoke to throw some of them out, depends on one’s interpretation of the Bank’s founding statement of purpose. For example, Nelson’s critical and powerful study stresses the key task of capitalist global integration: ‘Promoting foreign capital investment in member countries is emphasised in three of the IBRD’s [International Bank for Reconstruction and Development] five statements of purpose… and has remained central through its forty-five years’ (1995: 15). For Miller-Adams, the Bank maintains an imperative of institutional survival by maintaining itself as a lending ‘technocracy’ (1999: 6). Nelson adopts a radical political-economy perspective whereas Miller-Adams relies mainly on a kind of Weberian institutionalism. Hopkins et al. make a functional analysis of the Bank that condenses the Bank’s ‘essence’ into its work as a bank, a development agency, and a development research institution (2000: 283). The distinctions made by Hopkins et al. explore the ways in which the Bank can function more effectively in its core tasks, locating the World Bank in a liberal problematique of how to reconcile adroit public action with basically harmonious market forces. Thus, each writer must approach the Bank with a premise about the nature of its relations with other structures and processes. In this book, the neoliberal rostrums are not accepted as axiomatic and the analysis of the World Bank involves a critique of this intellectual paradigm within which the Bank operates. The three core realms of action outlined below–as facilitator of capitalist expansion, development agency and international institution–will be problematised within a particular framework which attempts to address the Bank as a political-institutional ‘moment’ within a broader international political economy.

The World Bank and global capitalism

The World Bank has openly and keenly worked to promote the expansion of international capitalism within its operations. Because of its institutional origins at Bretton Woods (Oliver 1975; Elson 1994) and the ascendance of an American-led liberal capitalist globalism after World War Two, the Bank has elaborated various forms of support for large-scale international capital which derives mainly from the US.⁶ But the World Bank also works to promote global capitalism in a more nationally disinterested fashion (Cammack 2004): the Bank will stop all lending to any member state that violates the property rights of a transnational corporation. A substantial portion of its project lending goes to transnational companies through public tenders in what Payer analyses as a form of global fordism for international firms (Payer 1991; Bracking 2003). The Bank’s end...