Remarks Of World Bank President Paul Wolfowitz After Meeting With President Lula

Remarks of World Bank President Paul Wolfowitz

After Meeting With President Lula

Brasilia, Dec 15, 2005

QUESTION: Mr. Wolfowitz, I’d like to know what are your opinions about the corruption scandals in Brazil.

WOLFOWITZ: Let me, let me make a few comments first. First of all I had been really looking forward to this visit, I’ve heard so much about this country over many years and particularly in the last few months in this job. Brazil is such an important country for the business of the World Bank, and I am very excited to be here.

I’ve had a very warm reception already in this first day and it completely lives up to what I’ve heard about Brazilian hospitality and warmth.  I just had a very good meeting with Finance Minister Palocci and then just now with President Lula, and I must say, speaking of President Lula, that he is a strong leader who obviously cares deeply about this country and he is also a leader in the world. I met him for the first time in fact in Gleneagles in Scotland at the G8 summit and I think Brazil has a leadership role to play particularly on the trade issue and on the issue of the environment.

There were three main issues that had been the subject of my discussions and that are central I think in the World Bank relationship with Brazil. One of them is trade, I’ve already mentioned it. We have important issues coming up with the Hong Kong meetings taking place now and there is going to have to be a lot of work after Hong Kong. The question of how you manage the extraordinary natural resources of this country and at the same time promote development…they can’t be enemies of one another, good development, good environmental management have to go together and I think it is a very important area where the World Bank is working with Brazil.

And finally, but not least important, most important really is what can we all do together to help the poorest people of this country, because one of the big challenges in Brazil and indeed throughout Latin America is that in spite of a pretty good economic record and well high enough income --that we call Brazil middle-income country-- there are still millions of people living in extreme poverty and that is a subject I witnessed this morning in Sao Paulo and we’ll be talking about it.

On the question you asked about, I am not here to get involved in current issues and this is a very important current issue in Brazil, but we did talk in fact with the President about this broader problem and it is a problem for all countries, including the most developed countries. The United States has problems about corruption, it is particularly a problem in the poorest countries of the world because they don’t have the institutions to deal with it, and it is one of the reasons I am afraid they stay poor.

So the challenge is how to develop the institutions that limit corruption, prevent corruption reduce its effects, and I would say two of the most important institutions, let me make that three, three of the most important institutions are a good judicial system and that is something where clearly Brazil is ahead of many countries but it has more work to do. A good system of democratic accountability and obviously Brazil is way ahead than most countries in the world in that regard…some of the world’s dictatorships hide their corruption problems but the corrupt problem is even bigger, and finally and I don’t just say that to flatter all of you but a free press is a very important institution for exposing corruption, dealing with it.

QUESTION: Have you talked about the election next year and how you think the economy will be hurt?

WOLFOWITZ: You really want to get me to leap into Brazilian politics, that’s good but look: our mission at the World Bank is to support the economic development and things that will help the poor.  I think in democratic countries generally speaking, governments that are good at that implement elections and governments that are not good at that eventually get turned out in elections and I think that’s why on the whole, and our studies show this by the way, that countries with better democratic institutions tend to progress better, but countries got to pick their own leaders, that’s not the job for any outsiders including the World Bank.

QUESTION: Did you speak about the new agreement with President Lula …he said that he wants to ask for a new financing program of 800 million for technology transfer and the legal system reform?

WOLFOWITZ: we did not talk about anything as specific as what you said. We talked about some general subjects in which that might be included but I am not sure.

QUESTION: Is Brazil ready for new investments?

WOLFOWITZ: Oh we are doing about two billion dollars a year in investments in Brazil and one of the things that defines Brazil as a middle income country is that two billion dollars is ten percent of what Brazil’s own resources provide through the National Development Bank.  I really have to go. Thank you.