756 words

The World Bank is not a charity, it's a business.

Most of the time when one hears about the world bank and it's claim of doing away with poverty especially by giving out loans to the poorest countries, he or she may think that the world bank is a saintly organization. However, analysis of the countries that have been given the loans shows that they actually pay back more than they gain (if they were given interest-based loans), and the money they are given is usually spent on buying or renting capital assets such as construction tractors from countries that are the major contributors to the World Bank. Therefore, the World Bank takes advantage of the hopeless poor countries.

One of the financial services the World Bank provides to developing/poor countries is that it provides low-interest loans to them (What We Do). Nevertheless, these are always long term loans and however low the interest may be, a lot of money will be paid back in terms of interest on top of the principle loan. The World bank seems to be indirectly run by super power countries the US, Germany, France, who are the top three financial contributors and whose ideologies like capitalism, democracy have to be adopted by whatever country that wants help from the world Bank. If these countries contribute a lot of their money that would have been used in national issues but is instead given to poor countries, it's not a favor but it's because they most likely want benefits from it. Thus, the world Bank in an investment channel to the developing countries, providing market for most of corporate companies like Shell, Coca Cola, which then transfer back the profits to the mother countries.

According to the BBC, one type of the projects that the World Bank sponsors is the one that develops the provision of clean water which usually involves building big water purifying plants. Although the sanitary water does lead to improved health, the purified water from such a plant costs more as compared to buying or collecting non-purified water (from a natural source) which people locally clean for example through boiling. Although it's understandable that water acquired from the purifying plant costs because of maintenance costs, poor people can't afford it daily and the plant is hardly utilized, yet the country has to pay back the World Bank.

Due to the fact that a certain poor country owes the World Bank, it can develop economic pressure to do a favor for the Bank but specifically to the super power countries that finance it. Susan George, a political scientist wrote, “Debt is an efficient tool. It ensures access to other peoples’ raw materials and infrastructure on the cheapest possible terms” (George). This is illustrated in Democratic Republic of Congo, where gold mines are issued as collateral security, and if DRC isn't able to pay in the given amount of time which is usually the case given it's unstable government, the gold is mined for a given period of time (usually years) to account for the debt.

Unfortunately, some developing countries go an extra mile in making cuts on important necessities, in order to pay back the loan. A research activist, Ashah Anup wrote that,

“But the way it has happened has required poor countries to reduce spending on things like health, education and development, while debt repayment and other economic policies have been made the priority” (Anup). This is contrast to one of the objectives of the Bank that states that, it aims to increase the standard of living for the poor. Debt makes most leaders in the owing country feel dependent and low, so they do whatever to feel like they are independent again.

In conclusion, the World Bank has enabled some developments in poor countries like better infrastructure, but like any corporate business or bank, it's strategy is to paint a good picture for itself as a non-profit savior for these poor countries, yet it benefits greatly and for a long time from them. Unless people stop being naive and research deeper on what some organizations that are considered “life saving” like the World Bank do, then eyes will continue to be blinded, the rich get richer, and the poor get poorer.

Works Cited.

Susan George, A Fate Worse Than Debt, (New York: Grove Weidenfeld, 1990), pp. 143, 187, 235.

Shah, Anup. “Structural Adjustment—a Major Cause of Poverty.”Global Issues. 24 Mar. 2013. Web. 08 Nov. 2013. <http://www.globalissues.org/article/3/structural-adjustment-a-major-cause-of-poverty>.

"About."What We Do. N.p., n.d. Web. 10 Nov. 2013. <http://www.worldbank.org/en/about/what-we-do>.

BBC News. BBC, n.d. Web. 10 Nov. 2013. <http://www.bbc.co.uk/schools/gcsebitesize/geography/development/aid_rev2.shtml>.