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By H. Marquette

In 1997, the realm financial institution introduced a method to assist its debtors strive against corruption, regardless of past claims that paintings of this kinfolk violated the Bank's non-political mandate. regardless of many makes an attempt to reshape corruption as an fiscal factor instead of a political one, the non-political mandate hasn't ever been satisfactorily addressed. Heather Marquette argues that the financial institution may still concentration in its strengths and stay away from the extra arguable elements of its anti-corruption programme, which threaten its credibility.

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Extra info for Corruption, Politics and Development: The Role of the World Bank

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55 The Bretton Woods system as envisioned by its founders ended abruptly on 15 August 1971, when US President Nixon announced his New Economic Policy (NEP). The booming American postwar economy was in a state of crisis by the beginning of the 1970s. Industrial productivity was down, excessive domestic inflation existed, unemployment levels were at their highest since the 1930s, and there were also massive short-term capital flow problems. 56 Importantly, it faced increased competition from a recovered European Community as well as from Japan, with the three becoming increasingly interdependent.

5 To simplify, conditionality can be defined as a system of rewards and punishments. Funding is received for meeting the donor’s objectives, with sanctions applied if the objectives are not met. There are several ways to apply negative sanctions: withholding grants and loans, terminating funds and technical support for projects in progress, restrictions on trade or economic and political sanctions. The innovation in aid in the 1990s, therefore, is not the introduction of conditionality on lending, but rather the increasingly political nature of the conditions themselves.

54 This statement greatly influenced the next Bank president, Robert McNamara, who took over after Woods retired in 1968. A turning point for the Bank The late 1960s marked an extraordinary shift in the World Bank’s development ideology. This transformation can be partially attributed to the arrival of the remarkable McNamara as president, who possessed a completely different background and ideas than those held by any of his predecessors. In addition, upheavals in the political environment around this time forced McNamara to rethink the Bank’s entire approach to development.

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