World Bank Begins Pilot Programs on Disclosure

1 June 2002


Some 20 countries are about to embark on pilot programs with the World Bank in which they will disclose and disseminate more information than they have in the past – that is, more than what Bank policy currently requires.

The exact dimensions of this effort will become clearer once the Bank makes an official announcement of the pilot projects. Details are still being worked out with the respective governments, and the terms will vary. Ironically, it isn’t clear that the documents related to setting up the pilot projects will themselves be made public. The negotiations have been kept low-key.

The Bank conceived of these programs last year as a way to encourage experimentation in disclosure beyond that mandated by Bank policies. This way, the Bank hopes to push the envelope on disclosure, but within bounds of comfort for the participating governments. In some cases, the governments may pledge to release all documents that Bank policies leave to each country’s discretion. Drafts of Country Assistance Strategy documents, for example, may be released in some countries.

Meanwhile, Bank observers are keen to know if these programs will result in meaningful disclosure.

Bank officials were somewhat surprised by the number of governments that signed up for the pilot program. So far, the list includes Turkey, Yemen, Brazil, Mexico, Armenia, Bulgaria, Georgia, Lithuania, Ukraine, Zambia, Mozambique, Indonesia and Cambodia. A “regional hub” is likely to be funded to service a number of countries in Southeast Asia. Several other countries have expressed an interest, including Belarus and Moldovia.

How these experiments develop may well affect the future course of disclosure policy.

Looking Ahead: What’s the World Bank Planning?

When it enacted a new disclosure policy in August 2001, the Work Bank asked its staff to study the gray areas in its disclosure practices. The outcomes could lead to more transparency. A (leaked) February staff report outlined progress on these matters, which include evolving a consistent policy on “redactions,” which is the practice of withholding portions of a document before releasing it. The Bank staff is preparing a new report on disclosure, and a board meeting discussion is expected this fall.

Redactions

The bottom line seems to be that the Bank allows more redactions than the International Monetary Fund, which limits redactions to highly market-sensitive information, mainly exchange-rate and interest-rate matters. Of the 100 Country Assistance Strategies (CAS) produced by the Bank between July 1998 and mid-January 2002, 84 have been disclosed, eight of which had portions deleted at the request of the country concerned.

In all but one case, the CAS documents that contained deletions involved countries that borrowed from the Bank’s International Development Association (IDA), which provides concessional loans to the world’s poorest nations. Forty-five of the 100 Country Assistance Strategies, however, involved loans from the International Bank for Reconstruction and Development. The IBRD lends to middle-income countries. Eleven of the IBRD Country Assistance Strategies were not disclosed at all.

But things seem to be improving. All six of the IBRD CAS’s discussed by the board this year have been or will be released. According to the staff report, “In the coming months Management will provide more detailed guidance to staff on handling redactions, and on applying the policy consistently across various document types.”

The staff report points to a weakness in the Bank’s disclosure policy. While regional development banks now routinely disclose the equivalent of their CAS, the Bank does not. Bank policy says that the CAS for IDA countries should be disclosed unless the government concerned objects and the Bank’s board goes along with the objection.

Country Performance Ratings

The Bank does not release the ratings it gives to each IDA borrower based on a Bank questionnaire. It does disclose their relative ratings (http://worldbank.org/ida/CPIA2001.pdf), but not the numerical ranking. The disclosure progress report gives no suggestion that this policy will change. The Bank indicates that country teams are now providing written justifications for the proposed country ratings, but these ratings have also not been disclosed.

Story in Gray

The Bank has agreed to disclose “economic and sector work,” also known as gray cover reports, that are circulated to the board. The staff report reveals that in fiscal year 2000-2001, 94 percent of the reports submitted to the board were disclosed. An annex lists the five not disclosed, usually at the request of the country concerned: Jamaica, China, Papua New Guinea, and Nigeria. The one on China, for example, dated April 25, 2000, was on “Managing public expenditures for better results.” The Bank is currently reviewing the policy on gray reports. The “nongray” reports – the ones that don’t go to the board – may be requested by the public, but the staff report notes that the Bank has no system for tracking such disclosures.

Factual Technical Documents

The Bank is planning to clarify the rules for disclosure of factual technical documents for projects under preparation. In the past, the Bank’s board was divided on whether these documents should be routinely disclosed. “Some EDs (executive directors) have expressed discomfort with the feeling that the disclosure of factual technical documents appears to occur at the discretion of country directors,” said the staff report. Fortunately, a list of these factual technical documents will be attached to Project Information Documents and the Bank expects more requests for them.

Disclosure of Draft Board Documents

There are some hints that the board may be considering releasing additional materials that are submitted to it in advance of decisions. A slight crack in the armor of secrecy was evident in the April 2001 decision to disclose poverty reduction strategy papers (PRSPs) before they were discussed in the board. Bank management is reviewing the experience of the Development Committee and Global Environment Facility Council, which release documents before they are taken up.

By Toby McIntosh

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ABOUT IFTI WATCH

In this column, Washington, D.C.-based journalist Toby J. McIntosh reports on the latest developments in information disclosure in International Financial and Trade Institutions (IFTI).
Contact: freeinfo@gwu.edu or
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