Bank/Fund Meetings: Dutch Positions

UNCLAS SECTION 01 OF 02 THE HAGUE 002352

SIPDIS


E.O. 12968 N/A
TAGS: EFIN EAID NL IMF IBRD
SUBJECT: Bank/Fund Meetings: Dutch Positions


The Dutch government has announced that it will support the
following positions at the September 21-22 Bank/Fund
Meetings in Dubai.


1. Enhancing Crisis Prevention
--------------
-- Adoption by the IMF on a trial basis of a "balance sheet
approach" in the context of regular Article IV
consultations.

-- Issuing Article IV reports without the country being
examined signing off.

-- Making more explicit in the "public notes" when countries
do not follow IMF advice.

-- Holding up "precautionary arrangements" as good signaling
instruments to promote good policies and calm markets.
However, the Dutch oppose exceptional lending under this
sort of arrangement.


2. Progress on Crisis Resolution
--------------
-- Ensuring faithful and consistent application of strict
conditions for exceptional access to IMF credit.
Discussions over Argentina will be an important test in this
regard. The Dutch believe the private sector has to play a
concrete role in solving the BOP problems of countries in
crisis.

-- Supporting the "contractual approach" to debt stocks
based on the G-10 standard.

-- Making codes of conduct more meaningful including through
fora where debtor and creditor country authorities can
interact.


3. Support for Low Income Countries
--------------
-- Increasing the effectiveness of programs through more
realistic growth prognoses and alternate scenarios and more
precisely spelling out the crucial policy measures that
should be taken.

-- Supporting better coordination between the Fund,
bilateral donors, and multilateral institutions.


4. Quotas
--------------

-- Opposing a general quota increase


5. Funding for Development
--------------
-- Mobilizing sufficient funding for development including
through overall increases and increased effectiveness of
ODA.

-- Encouraging more extensive and effective peer reviews

-- Stressing that OECD members should confirm to the UN
"norm" of allocating.7 percent of their GNP to ODA


6. Representation and Participation of Developing Countries
and Countries in Transition in IMF/World Bank Decisionmaking
-------------- --

-- Opposing a third African seat on the Board of Governors
as this could cost the Netherlands its seat.

-- Supporting a gradual increase in the number of basic
votes to correspond with the original share of basic votes
in the total voting weight.


7. Progress Report on Trade
--------------

-- Underscoring the importance of continued trade
liberalization and the role of the World Bank in its
analytical work in support of free trade.

-- Calling for the Bank/Fund to include trade policy as a
theme of their surveillance activities.


8. Monitoring Achievement of MDG
--------------

-- Increasing dialogue between developed and developing
countries on achievement of the MDG


9. PSRP/HIPC Progress Reports
--------------

-- Underscoring the significance of the PSRP process and the
importance of each country's assuming responsibility for its
own development.
-- Expressing continued concern with the tenability of the
debt burden of HIPC countries.


10. Implementation of the World Bank Group Infrastructure
Plan
-------------- --------------

-- Supporting this action plan and calling for more support
for investment in poverty-reducing infrastructure.


Sobel