CDF Proposal

This discussion draft is also available in PDF format,
suitable for printing or reading offline: cdf.pdf (160K)

Contents:
Introduction
Part I: A Concept — A Balance Sheet with Two Sides, a Coin with Two Sides, a Duet with Two Parts
Part II: A Proposal for a Broader Approach to Partnership and to Management of the Development Process
Conclusion
Attachment I: The Prerequisites for Sustainable Growth and Poverty Alleviation (PDF file)
Attachment II: New Development Framework - Bolivia (PDF file)

Introduction

Obviously I believe that we and all of the above groups have contributed significantly to the betterment of mankind and to the improvement in the lives of many in poverty. I am convinced of the importance of consultation and participation. But the fact remains that progress is too slow. With three billion people still living under $2 a day, with growing inequity between rich and poor, with forests being degraded at the rate of an acre a second, with 130 million children still not in school, with 1.5 billion people still not having access to clean water, and two billion people not having access to sewerage, we cannot be complacent. More than this, we must be concerned that 80 to 90 million people are being added annually to our planet, mainly in the developing world. Two billion more souls must feed themselves by the year 2025, hampered by wars, with growing inequity, and with distortions of economies and politics as evidenced in crises from Indonesia to Russia and from Latin America to Africa. With the reduction in Overseas Development Assistance and current instability in the international financial markets, there is much to be concerned about.

Poverty Alleviation and Development Effectiveness

I have been considering the special role of our institution and its effectiveness in poverty alleviation and sustainable development. Together we have worked very hard over these last years, building on the extraordinary work done in the past, to redirect our institution to one that is results-based and not volume-or procedure-based. I am extremely grateful to all of you for the hard work that is already bearing fruit. We are fortunate because we have 54 years of experience and several institutional frameworks, including the IBRD, IDA, IFC, MIGA, as well as related institutions such as Consultative Group for International Agricultural Research — Executive Secretariat (CGIAR), Global Environment Facility Secretariat (GEF), and Consultative Group to Assist the Poorest (CGAP). We can be proud of our history and of the role we have played. We have extremely experienced people in most areas of development — or at least access to them. We are making use of partnerships with others who have more effective skills or broader reach of resources than we have. We are indeed learning to listen more and to be a better partner for the governments and the people we serve and for those with whom we work in the international and local communities.

In addition, I believe we have a better articulation of our role with the IMF. Broadly, our sister institution has the responsibility for macroeconomic stabilization for our client countries and for surveillance. We have the responsibility for the structural and social aspects of development. Obviously, these are not two isolated roles and we work together very closely on a day-to-day basis.

As I have said before, the two functions are like breathing in and breathing out. An appropriate macroeconomic framework is essential for our work, but the social, structural, and human agenda, which we share with the regional banks, members of the UN system, and other partners in development, is essential for the IMF which cannot and does not prescribe in a vacuum. Together we must serve the hopes and aspirations of the people in our client countries, or our clients will not achieve their objectives in peace and stability. And together, we must work with and support the work of the World Trade Organization which is so critical to the trading arrangements and future of our client countries.

In particular areas, such as strengthening the financial systems around the world, we work together as partners with the IMF, regional banks, the BIS, and other institutions; each of us contributing according to the needs of the situation and our available human resources. Our partnerships with the international community are many and varied and serve our clients well.

Part I
A Concept — A Balance Sheet with Two Sides, a Coin with Two Sides, a Duet with Two Parts

The Need for the Right-Hand Side

There is however, a clear need for a second side which reflects more adequately an analytical framework that presents the structural, social, and human aspects. It must go beyond the familiar statistics of infant and maternal mortality, unemployment and children in school, to address fundamental long-term issues of the structure, scope and substance of societal development.

Let me explain this a little more, but before doing so, let me say that I am not too convinced about the imagery of a Balance Sheet. Perhaps we could speak of two sides of a coin, or two parts of a duet. What is key is that the two parts, namely macroeconomic aspects on the one side and the social, structural and human on the other, must be considered together.

But let me return to my balance sheet example. Unlike macroeconomic analysis which brings everything together in a familiar consolidated form, we in the development field have been less successful in giving an accountable presentation of the status of structural work and social progress. This is not surprising since multilaterals and bilaterals alike are limited by resources, experience, and reach and none except the government of the country in question has an overall responsibility. Governments have the responsibility for putting it all together in a comprehensive review of all the elements required for growth and poverty alleviation. But we know that not all of the governments we serve have the capacity to do so, or the resources, or sometimes even the will. Now is there an agreed framework for presentation.

We also know that we "players" in the development business are surely not accustomed to working together in harmony, neither the UN system and multilaterals with bilaterals nor NGOs with the private sector. We certainly cooperate more than we did in the past. We at the Bank are committed to strengthening such cooperation. But there is still suspicion and many historic grudges and perceptions. What is necessary is an overarching framework — an approach agreed with the government concerned — which will allow us all to work together to meet our goals for poverty alleviation and environmental sustanability. On the basis of such work, we would then be able to present a right-hand side of the Country Balance Sheet which would allow for a more comprehensive analysis and more soundly based action.

The Comprehensive Development Framework and the International Financial Architecture

Within and without governments, in a multitude of research and private organizations, in the press and public discourse, analysis is proceeding as to how the world financial and economic system should be changed, and what role the Bretton Woods institutions are to play. I am of the personal view that with some few changes, including expanded and more transparent financial information, the basic international architecture has served us well. Of course, it can no doubt be strengthened and I am certain that many suggestions will be made. I wish to deal here with only one aspect of the debate.

The Comprehensive Development Framework I am proposing highlights a more inclusive picture of development. We cannot adopt a system in which the macroeconomic and financial is considered apart from the structural, social and human aspects, and vice versa. Integration of each of these subjects is imperative at the national level and among the global players. It is not possible to separate these subjects in Part I countries where the structure of economic and social governance exists. It is certainly not possible to separate these subjects in Part II countries where there is much less tolerance for risk due to fragile structures. A wrong step on the macroeconomic side can have dire consequences for the structural, social and human dimension. In addition, profligate and unbridled spending without regard to resource constraints and fiscal and monetary policy can also have dire consequences.

The Prerequisites for Sustainable Growth and Poverty Alleviation

What are the basic structural, social, and human prerequisites that should balance the macroeconomic considerations? Let me set forth my list which we should examine and test over the next 12-18 months. But before doing so, let me make one additional important assertion. I believe that unless we think of having all the basic prerequisites, say over a 20-year timeframe, we will endanger, and sometimes ruin the effectiveness of individual projects and programs which we undertake with our clients. Clearly not all the objectives can be approached simultaneously. The framework should not become a straight jacket. We need the flexibility to adjust to the varied conditions of each country. There will be a need for setting priorities, for phasing of action based on financial and human capacity and based on necessary sequencing to get to our objectives. But over time, all the requirements within a holistic framework must be addressed if there is to be stable, equitable, and sustainable development.

One of the reasons for developing such comprehensive, holistic framework is to allow us to think more strategically about the sequencing of policies, programs, and projects and the pacing of reforms. While the comprehensive approach emphasizes that we must advance on all fronts, certain steps need to be taken before others.

Let me give some examples of what I mean. The fact is that the success of most projects is dependent on many assumptions extraneous to the project itself. Building new schools is of no use without roads to get the children to the schools and without trained teachers, books and equipment. Establishing banks and financial institutions without a banking system that is supervised will lead to chaos. Initiatives to make progress creating equal opportunities for women make no sense if women have to spend many hours each day carrying clean water, or finding and gathering fuel for cooking. Seeking universal primary education without prenatal and postnatal health care means that children get to school mentally and physically damaged. Establishing a health system but doing nothing about clean water and sewerage diminishes enormously the impact of any effort. Seeking equity when government is riddled with corruption and has inefficient and untrained officials is an objective that will never be realized.

Privatization prior to establishing an effective regulatory or competition framework can be a recipe for a disaster; the benefits of lower prices for consumers may well not be achieved. We know, at least from hindsight, that part of the failures in Russia were due to paying insufficient attention to the preconditions for a market economy. Too often in the past, we have gone after the "easy" targets, saying that we would attack the more difficult (often institutional) issues later on. In doing so, we have failed to recognize the essential complementarities.

By contrast, good business strategy attempts to identify bottlenecks — the hard to solve problems that are impediments to success — and it begins by attacking these first. We must learn to apply these lessons to attack poverty and bring about development.

It is also clear to all of us that ownership is essential. Countries must be in the driver’s seat and set the course. They must determine goals and the phasing, timing and sequencing of programs. Where there is not adequate capacity in the government to do this, we must support and help them to establish, own, and implement the strategy. And we must work to achieve the strategy with our colleagues in the government, in the international development community, the civil society, and the private sector. In some countries the long and short term goals will be set by a process of public debate and consensus building led by the government with all sections of society. In other countries, the establishment of goals will continue to be set more centrally.

Let me now set down a possible framework for presenting and managing a holistic approach to the structural, social and human aspects of development.

A. Structural

1. Good and Clean Government:
A country must have an educated and well-organized government. This requires capacity building, an open legislative and transparent regulatory system, properly trained and remunerated officials and an absolute commitment to clean government. While building an effective government framework is difficult, it will become impossible if there is corruption which is the single most corrosive aspect of development and must be fought systemically at all levels. Particularly it must start with a vigorous commitment from the leadership to fight corruption on all levels, with initiative both to prevent it from happening and a system for finding and punishing wrongdoers where corruption exists. The lead must come from the top and efforts must be persistent and unyielding.

2. An Effective Legal and Justice System:
Without the protection of human and property rights, and a comprehensive framework of laws, no equitable development is possible. A government must ensure that it has an effective system of property, contract, labor, bankruptcy, commercial codes, personal rights laws and other elements of a comprehensive legal system that is effectively, impartially and cleanly administered by a well-functioning, impartial and honest judicial and legal system.

3. A Well-Organized and Supervised Financial System
We have recent significant evidence from Asia and other parts of the world that unless a financial system is well organized, audited and supervised, any country and region is at risk and the people who suffer most from crisis are the poor. Accordingly, a government must establish an internationally accepted and effective supervisory system for banks, financial institutions and capital markets to ensure a well-functioning and stable financial system. Information and transparency, adequately trained practitioners and supervisors, and internationally acceptable accounting and auditing standards will be essential. Regulation and supervision must include banking, savings institutions, insurance and pension plans, leasing and investment companies. Capital markets should also be developed and strengthened as resources allow.

4. A Social Safety Net and Social Programs
Clearly, a country’s history and culture as well as its state of economic development, will dictate the extent and nature of social programs a government can or wishes to provide. But whether by informal arrangement, familial or tribal support or by government-provided programs, provision must be made for the elderly, the disadvantaged and disabled, for children, for the those men and women unable to find work, and those affected by natural disasters and the aftermath of war. In some transition economies, the social safety net is needed for those put out of work as a result of large-scale privatizations. Employment opportunities and the terms of employment are crucial to any functioning system. Governments must also provide special programs for indigenous people whose needs are different and whose culture and integrity must be preserved.

In the process of development, traditional institutions and relationships are often undermined, weakening the fabric which holds society together. There may actually be a degradation of social capital. Violence and social unrest may increase. Effective development must address these social concerns. It must both help re-establish a sense of community and knit the entire society together.

This whole area of social programs is very difficult and is heavily dependent on available budgets. But it is crucial to the long-term peace and stability of any country and must rank high on the agenda, particularly for international aid and development agencies working with governments.

While macroeconomic management is never perfect — there will always be some fluctuations in output and employment — the most effective safety net is a policy which maintains full employment. Deep recessions and depressions have adverse effects on virtually every one of the elements of the development strategy: health deteriorates, schooling is interrupted, and poverty increases. Formal safety nets are but an imperfect stop-gap measure in addressing the failures of effective macro policies to maintain the economy at full employment. It is on this subject that the link between the two sides of our balance sheet is most crucial.

Let me now switch gear and suggest six other elements which are basic to effective development and poverty alleviation. Let me start with two human aspects, perhaps the most fundamental of all, dealing with strengthened capacity of individuals in a society. I refer, of course, to education and health.

B. Human

5. Education and Knowledge Institutions
All agree that the single most important key to development and to poverty alleviation is education. This must start with universal primary education for girls and boys equally, as well as an open and competitive system of secondary and tertiary education. Construction of schools, modern curricula geared to the new technological age, and the real needs of the emerging local market, and effective teacher training and supervision all contribute to successful educational programs. Adult education, literacy and lifelong learning must be combined with the fundamental recognition that education of women and girls is central to the process of development. A government must also be careful to learn lessons of practice and history from indigenous peoples and communities, so that education is not imposed from afar but benefits from relevant local, communal experience. Finally, preschool education must be given its full weight in programs. This can be a key to the development of a child, the level of education reached, and thus the eventual achievement.

In addition, I should observe that developments in science, technology, and knowledge transfer offer a unique possibility to countries to catch up with more technologically advanced societies.

6. Health and Population Issues
It is obviously crucial that mothers are supported and that children get adequate health care before and during school years or they will have their capacities diminished. Governments must ensure the provision of health services for adults and elderly at communal and local levels, as well as services for family health care and family planning. These services can come from a variety of sources, both public and private. The sheer growth in population is itself a critical issue which must be addressed in various ways depending on belief and culture. It is linked to education and to religion, and to available health services, and must be addressed by governments as they see fit. Specialized health-care facilities should also be provided on a national or regional basis.

Unless population growth is brought under control, the less developed countries face a losing battle, with most of the scarce savings being used simply to forestall a decline in standards of living. While in recent years in many countries, the percentage of those in poverty has declined, global population growth has been so rapid that the absolute number of individuals in poverty has continued to increase.

We are also confronted with major problems of disease which range from tuberculosis and malaria to AIDS which in all too many countries is being inadequately addressed. Not only can health be a human issue of great proportions but in many countries, health is a barrier to equitable development and to growth.

And now let me pass to the key physical needs of development.

C. Physical

7. Water and Sewerage
With 1.5 billion people not having access to clean water and two billion without access to sewerage, and with the increasing demand for water from industry and agriculture, an effective method of distribution, delivery, finding, and saving water is fundamental. So too is a strategy for sewerage, which not only pollutes water supplies but also affects health in a dramatic way. The regional aspects of water supply will have an increasing impact on peace, investment, and development in years to come, as well as on the individual lives of people, particularly women, in rural and urban areas.

8. Energy
Two billion people without access to power resort to the use of wood and fossil fuels, resulting in health and breathing problems. Availability of power is not only an issue of convenience but saves the time of women searching for alternative fuels. The environmental impact is also great, it having been evident for centuries with forest destruction altering weather patterns and affecting the quality of air we breath. It is also a major issue for private investment which calls for an adequate, reliable, and appropriately priced source of power.

9. Roads, Transportation and Telecommunications
Many leaders have told me that an adequate road system is the starting point for development. Rural and urban roads make possible trade and services, provisions of health care, and getting children to school. Trunk roads are essential to link rural, urban and regional areas. Rail and air transportation systems are also key to growth and link countries to regional and international markets.

In addition to physical communications, access to telecommunications for trade, information and education will be absolutely essential to development in the next century. Without appropriate telecommunication, whether it be telephone or e-mail, computers or wind-up radios without batteries, poverty will not be fought and equity and opportunity will not be provided. Without access to modern communications, the difference between rich and poor will increase due to the knowledge gap, and growth will be restrained.

10. Sustainable Development, Environmental and Cultural Issues
There is a growing agreement that protection of our planetary environment is an issue for all of us and that this translates into regional, national, and local strategies. Evidence can be found everywhere, whether it be in Russia, Thailand, or Japan, that pollution can not only kill but it can have severe adverse impacts on economic activity and on growth. Volumes have been written on the subject of environment — on the preservation of our natural resources from forests to biodiversity, on the quality of our air and water, on its significance as an economic factor. The continuing degradation of important natural resources, like forestry, aquifers and so on, represent a silent crisis that will be difficult to reverse. Let me simply flag the issue here as a vital element in any assessment for the health of a society.

Cultural preservation is also crucial not only historic sites, artifacts and books, but also the spoken word and the arts. I believe that there can be no true national development without preserving peoples’ history and culture, particularly in a new, globalized environment where there is pressure for "sameness" in all countries. Culture can be justified for tourism, for industry and for employment, but it must also be seen as an essential element in preserving and enhancing national pride and spirit. I will not easily forget my visit to Mali, one of the poorest countries in the world which, more than a millennium ago, led an empire that stretched up to Egypt. Only this week, I met with the Vice President of Bolivia who told me that the largest city in the Americas was once in his country and that the preservation of its history is part of their national pride.

Some believe that culture is a luxury — low on the list of development priorities. I do not agree and nor does any single leader of countries to whom I have spoken. But this is an issue for another day when we can ask what would France, Germany, Italy and even Australia be without their defining culture.

D. Specific Strategies — Rural, Urban, and Private Sector

Finally, let me shift gear once more to three specific groupings of strategic issues requiring special attention, namely a rural strategy, an urban strategy, and strategy to promote and maintain private investment. Each of these strategies will build upon the issues already discussed, but because of the importance and special nature of these three subjects, we set them apart for individual attention and review.

11. Rural Strategy
With the largest concentration of poor in rural areas in most countries, it is important for governments to establish a coherent rural strategy. It is not sufficient to have new crops and agricultural extension programs if there is not provision for trading, for microcredit, for storage, for transportation, and for non-monopolistic outlets. In addition, there must be technical assistance to farmers and converters of agricultural produce. Governments need to think of integrated solutions to rural development, not just individual programmatic help. Integrated action does not mean a return to complex comprehensive and complicated state planning, but we must get beyond individual programmatic help in order to be effective.

12. Urban Strategy
With 66 megacities of more than ten million people expected to be established in developing countries by the year 2025, with growth in all urban concentrations, and with our existing experience from Jakarta to Mumbai (Bombay), we have ample illustration of the special problems of urban management. It is clear that governments must have an urban strategy which differs from an overall national strategy to the extent that concentration of population causes special and unique problems. Urban planning and appropriate action will be crucial in the next millennium.

13. Private Sector Strategy
It is clear that the engine of growth is the private sector, both domestic and foreign. A vibrant private sector requires that crucial elements of structural policy are in place. These include trade policy, tax policies, competition and regulatory policy, and corporate governance.

Conditions must be created for a climate of investor confidence — with appropriate laws, transparent regulations, and predictable taxes. Whether the issue is protection of property rights or fair and equitable labor practices, governments must give certainty to the investor about the "rules of the game". Provision of credit, guarantees, sources of funding for projects all play a part in the competitive search by governments for investment and for job creation. Nothing is more significant to economic growth than the private sector.

14. Special National Considerations
For completion of this list of prerequisites, I would leave an empty box (#14) along the top of the matrix for Special Considerations depending on the country or the region. In Bolivia, for example, the box was filled by the government with a strategy for an Anti-Cocaine Production Initiative. In other countries, it will be filled in according to the special needs of the country or region. My purpose in suggesting an extra heading (or more, if necessary) in the matrix is to give flexibility for specific country considerations.

All these issues together constitute the Right-Hand Side of the Balance Sheet.

Part II
A Proposal for a Broader Approach to Partnership and to Management of the Development Process

If we can accept for the moment that the above-mentioned listing is a plausible statement of the structural, social and human prerequisites for sustainable development, we can now devote attention to a consideration of what is being done in these areas and by whom. It is obvious to me that there is much too little coordination of effort, much too much suspicion between participants and in many cases a simple absence of a framework to coordinate and bring together under government guidance an agreed set of objectives and effective and accountable programs. There is too little transparency, much too little consultation and too little accountability for performance.

We would like to test as a management tool a matrix. On the top of the chart — the horizontal axis — lists, we list the 14 subjects referred to in Part I. On the vertical axis, it will list the "players" in the development business.

The players in the development field seem to be four:

• The Governments — national, state, city and municipal, within each country, and in some cases, regional groupings of governments. I would add that we should not forget the impact of the parliamentary bodies which also constitute both an element in government and a representative of civil society.

• Multilateral and bilateral agencies

• Civil society in all its forms

• Private sector, domestic and foreign

The matrix will look as follows:

Before discussing this matrix, let me make general preliminary points:

First, there is no way that the World Bank should be seen as assuming the role of the coordinator of all programs in the matrix. In some cases, under the guidance of government, we will lead the process or segments of programs. In other cases, we will follow the lead of others, and in further cases, we will not participate at all. The existence of the matrix is not a clandestine attempt on the part of the Bank to dominate the international development arena, or the donor dialogue in a given country. Quite the contrary. It is a tool to have greater cooperation, transparency, and partnership.

Second, stated more simply, the foremost objective of the matrix is to give all the players, but most especially national governments and parliamentary bodies, a framework of information which can ensure openness, a basis for coordination of effort, and for judgment of the effectiveness of programs and strategies. The matrix is open to all. It is a step towards inclusion, transparency and to accountability. Used correctly, it should stop much of the mud slinging and allow for legitimate and constructive praise and criticism — and above all, give a basis for evaluation and accountability.

Third, I recognize that the pace of coordination and of inclusion, of openness and accountability, will vary by country and by stage of political development. But in this sense, the matrix is neutral, and the government and the society it represents can alone determine the pace at which it wishes to move to a comprehensive program of coordination and measurement of performance. Ultimately, the matrix is a tool for the governments and people of the countries we serve. It is they who must own the programs, not us, and it is they who must set the pace.

Fourth, the matrix and annexes can and should be kept up to date in real time. The matrix will be a summary management tool. But behind each heading there will be Annexes for each subject area, containing a substantive description and far more detailed listings of short and long-term goals, programs, their present status, timing, cost and progress. These annexes can, and should, be kept up-to-date using modern communication and information technology, possibly with open designated websites.

Having discussed the top line extensively in Part I of this paper, let me now turn to the vertical axis on the chart, broken down into the following four participant groups in the development process:

1. Government

At the first level, the governmental structure of a country must be in charge of the process of development strategy and implementation. Government should aspire to have programs under each of the 14 headings along the top of the matrix and these will be entered into the grid. Obviously, the entries will have to be made in a form of shorthand and as I just noted, annexes behind each subject heading will give fuller details. For example, an annex on Justice Systems, an annex on education, giving far more detail on each subject.

Government should include not only national programs, but provincial and state, city and municipal to the extent that they are relevant.

2. Multilateral and Bilateral participants:

The listing of those involved in the programmatic thrusts is long, but let me give an incomplete but indicative listing.

IMF
UN agencies and programmes
WTO
European Union
Regional development banks
Bilateral agencies
International organizations

All of these participants, as well as the World Bank Group, are involved in projects and programs for development. At a time of lessening resources for overseas development assistance and budgetary restraints on agencies which reduces available human resources, each of us needs to know what the other is doing so that we can cooperate and avoid duplication of effort.

3. Civil Society

In all its forms, civil society is probably the largest single factor in development. If not in its monetary contribution, then certainly in its human contribution and its experience and its history.

It is by its nature somewhat disorganized, due to the diversity of groups involved, although individual projects and initiatives are often meritorious, effective and of very long standing. There is, however, little accountability with some non-governmental organizations. Certainly greater cooperation with governments, multilateral and bilateral agencies and the private sector would be beneficial to all.

The list of participants in civil society is great, including, of course, elected parliamentary assemblies which are included also in the government sector. An incomplete list is as follows:

1. Religions and religious organizations;
2. Foundations;
3. Trade unions and employee organizations;
4. Employer organizations;
5. Non-governmental organizations with international reach;
6. Local non-governmental organizations;
7. Local groups organized for consultation and for implemention of projects; and
8. Organizations of indigenous peoples

Depending on local political circumstances, civil society has a greater or lesser voice, but our experience is that by engaging civil society in projects and programs, better results are achieved both with design and implementation and usually greater effectiveness, including more local ownership. I think we all recognize more and more that local ownership is the key to success and project effectiveness.

4. Private Sector

It is absolutely clear that domestic and foreign private investment is the key to economic growth and employment. It offers know-how, training and investment which is essential for development and for the creation of employment opportunities. Private sector involvement is essential for science and technology — a critical factor for growth in all countries. There is a responsibility on governments to provide an appropriate climate for investment, but there is also a growing understanding on the part of business leadership that it is not only morally good but good business to invest with a strong sense of social responsibility.

One should also note that many public projects can now be undertaken by the private sector; e.g. water, power, and communications, and that in many economies privatization of state-owned industries is a significant element in sustainable growth and in balancing the budget.

If it were possible for all four groups to share information on what they are doing and plan to do, we would have a real chance of achieving longer term targets in a more effective and accountable manner. Accordingly, the matrix will look as shown on Exhibit 1. This matrix will allow us to see quickly what is going on in a country from the point of view of structural and social development and will also show us what is not going on.

In my judgment, if we can develop the matrix effectively, it will be essential for governments and ministers alike to look at both sides of a country’s balance sheet when they come to assess a country’s position. It will not only be crucial to look at the macroeconomic, financial and trade statistics but it will be equally important to look at the structural and social representations.

Goals, Achievements & Results

The Annexes to the matrix will play a crucial role. They might start with a general overview of the objectives of the government over the long term in each subject area. It will be crucial in each annex to set forth where the country stands in terms of achievement and where they want to go. The matrix should be read in terms of the stipulated and agreed goals. There would follow a strategy for implementation with a timeline. Thereafter, one could imagine a more detailed listing of projects achieved, projects underway, and projects planned, together with a listing of those institutions providing assistance and a detailed description of the projects planned and undertaken with their results. The format of the annexes should be set according to the subject and to those participating in preparing and managing it.

For each of the annexes, specialists would meet under the guidance of the government or minister concerned perhaps setting forth the program for the next one to three years within a ten to twenty-year framework. These annexes would be kept up-to-date as interaction with all the interested parties occurs. The information would be transparent and available to all. It would be a critical management tool.

It would also be possible to link on one internet site all the "players" so that a continuing dialogue can be maintained and the maximum cooperation achieved. Participants wanting advice or reaction to an initiative could get help from all other participants and have access to best practices available in the development community.

Proactive knowledge management will allow all of us to share best practices and new research results. It will challenge us to improve our understanding of linkages and causality affecting poverty and set the pace for new analytical work and an invigorated research agenda. We hope to work on such an agenda with our partners in government, academia, and business.

I believe the impact of technology on development cooperation will be profound and far-reaching if used effectively. Already, we at the Bank are linking all our overseas offices with voice, data, and video communication by satellite and this can be a basis for a single, inclusive and transparent global community.

The Test Phase

We are in the process of agreeing with a dozen or so countries to try out the Comprehensive Development Framework on an inclusive, transparent, and accountable basis. Already, our colleagues working in Bolivia have produced their own form of matrix which is attached. We will continue to experiment as we go forward.

Crucial to the success will be open discussions with all participants to learn from their experience, to have them join in the experiment to the extent that they wish. We will be totally open and looking for full partnership. Without it, this program cannot work.

Conclusion

To conclude, let me say that none of this would be possible without the work being done individually by all our institutions in giving advice and support on projects and programs. Clearly this must continue with even greater efficiency and effectiveness.

What is new is an attempt to view our efforts within a long-term, holistic and strategic approach where all the component parts are brought together. Such development should, in our judgment, be a participatory process, as transparent and as accountable as possible within the political climate prevailing in each country. This is not a return to central planning. It is a holistic and strategic approach to development based on country ownership and partnership.

What is new is the commitment to integration of effort, essential in today’s global economy where overseas aid is declining significantly. It is also a commitment to expanded partnerships, transparency, and accountability under the leadership of the government.

What is new is that the international financial architecture must reflect the interdependence of macroeconomic and financial, with structural and social and human concerns.

I personally believe that unless we adopt this approach on a comprehensive, transparent, and accountable basis, we will fail in the global challenge of equitable sustainable development and poverty alleviation. We will fail to build a sustainable international architecture for the coming millennium.

Certainly, we should give this approach a chance, work with our chosen countries, with our partners, and measure our results in a 12 to 18 month timeframe. I am not wed to every word of this approach. I want to test it, and if it can be improved and developed so that we can all be held to higher and more accountable and comprehensive standards, then our goal of making a better and fairer world will be closer at hand.