Nevertheless, not to be outdone by its institutional peer, the Inter-American Development Bank has just completed a round of soul searching of its own, and by "soul" I mean billions of dollars and by "searching" I mean meeting at a beach resort in Cancún.
But while it's cooler and hipper counterpart the IMF, with french "socialist" rock star Dominique Strauss Kahn (DSK) at its helm, is out reinventing the world's financial architecture and recanting on its long held dogmas, it appears the IDB got to the recapitalization party a bit too late, securing a mere $70 billion for itself. According to a report from IPS the IDB had previously sought more than twice as much:
"The IDB had been seeking a 180 billion dollar increase in capital, as the governors of the Bank - usually finance ministers or central bank directors from the member countries - had agreed at the last annual session in Medellín, Colombia in March 2009.Ouch! It looks like the IDB's governors didn't buy its idea to follow the IMF's lead and use the crisis to expand its operations. During the crisis the IDB increased it's annual lending significantly to help cushion part of the recession. Thing is, it looks like they wanted to keep up the new level of lending permanently but the governors just weren't going for it.
But 110 non-governmental organisations (NGOs) from 22 countries of Latin America and the Caribbean objected to that sum, arguing that the IDB had not justified that amount, had refused to share a draft of its replenishment proposal, and had failed to provide responses to recommendations for reforms."
In any case, them NGOs have been pissed at the IDB for a while for, among other things, having a terrible environmental trackrecord, a chronic lack of transparency and accountability, and it's failure to learn from its mistakes and seek alternative regional integration models. Now, shockingly, it looks like the IDB's governors are, if not listening to the NGOs proposals, at least seem to be paying lip service to them. The IDB has 60 days to incorporate the recommended reforms before submitting the final recapitalization request to it's governors.
Time will tell if IDB management will follow through but the members of the NGO coalition are keeping their cool:
"The Cancun Declaration is a step forward, but is only that- one step... We hope we will not have to wait another 16 years until the next capital increase request for the Bank to fully take on the challenges of efficiency, accountability and environmental responsibility."