MercoPress. South Atlantic News Agency

Reforms anticipated in World Bank.

US President George Bush re-election is expected to bring pressure on multilateral credit organizations for stricter monitoring of loans and most probably the naming of a new president in the World Bank.

The US Treasury Department under President Bush has been in constant friction with World Bank president James Wolfensohn, 70, named during the Clinton administration, over the way the bank's resources are spent.

A non written agreement dating back to Bretton Woods splits the two main financial institutions between United States and Europe. An American heads the World Bank and a European, (Rodrigo de Rato from Spain) the International Monetary Fund.

The World Bank annually invests 20 billion US dollars in Africa, Latinamerica, Asia and East Europe, while the IMF overviews international financial stability.

Until September 11/2001 the Bush administration didn't show much interest in multilateral organizations, but since it closely scrutinizes these institutions in the framework of its campaign against money laundering and terrorism financing.

Professor Alan Meltzer from Carnegie Mellon University who was member of a panel tasked with restructuring the World Bank and the IMF said that "the previous US administration gave several countries too much money instead of insisting that problems be addressed and a minimum of reforms be advanced".

The Bush administration favours countries receiving more concessions rather than credit to overcome their foreign debt burdens and has insisted in strict auditing of loans to ensure that they perform correctly. Besides the Bush administration is against extending credit to countries that enforce "inadequate" policies and rejects the idea of "rescue packages", so common in Clinton's days explained Professor Meltzer.

Apparently the Bush administration is satisfied with IMF's internal reforms but disappointed with the World Bank's performance.

"An improvement in the World Bank will have to wait for the naming of a new president", forecasted Professor Meltzer. Mr. Wolfensohn concludes his term June 2005.

Both US Treasury Secretaries Paul O'Neil and John Snow never hid their irritation with the way Mr. Wolfensohn spent the bank's resources.

"Differences between the Treasury Department under the Clinton and Bush administrations and the World Bank are both in style and substance", indicated Nancy Birdsall who heads the Centre for World Development in Washington.

The Clinton administration was more interested in ensuring sufficient funds for the IMF and left other countries involved in development issues. The Bush administration on the other hand wants more strings tied to loans and has "a strong Republican Congress which can push through all the reforms it wishes"