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Social Policy Guidelines are the Missing Block in the New International Financial Architecture, declares Camdessus

ICFTU ONLINE..., 079/990422/GA, 22 April 1999

Washington, 22 April 1999 (ICFTU OnLine): In a Press Conference marking the start of the IMF/World Bank Spring 1999 Meetings, Michel Camdessus, Managing Director of the IMF said that social concerns should be at the heart of efforts to construct a new financial architecture to manage and avert financial crises. Camdessus was responding to a question from the Trade Union World correspondent on the status of the Social Policy Guidelines which will be the subject of deliberations at the joint World Bank/IMF Development Committee meeting taking place on 28 April in Washington, DC.

Social policy has been the missing block in the architecture, according to Camdessus, and this gap needed to be filled, as efforts to protect social spending in health, education and social safety nets in support of vulnerable groups were important for the success of policies to restore growth. The World Bank has been invited to add this social block to the architecture, said Camdessus, who implied that the Bank needed to accelerate the pace of its work.

The IMF was already working in close cooperation with the ILO to support that organisation’s efforts to promote core labour standards, to give workers a voice in the reform process through tripartite consultative mechanisms at country level, and to protect children through standards on child labour. Increasingly, the IMF was bringing these issues to the fore in its consultations with member states, according to Camdessus, and Korea and Indonesia were two recent examples of this.

It should be noted that a two-tier lobbying campaign has been launched by the ICFTU in Washington and in the capitals of member states of the IMF’s Interim Committee and the World Bank/IMF Development Committee, to get the ICFTU’s proposals on the discussion table at the Spring meetings. The ICFTU is lobbying for a new approach to the governance of the international economic and financial system, one which builds a strong social dimension into the process of development in an integrating world. The ICFTU’s detailed proposals for this new approach are contained in its statement to the Spring meetings, which is also posted on this website. It calls upon the IMF and the World Bank to act with equal vigour in developing principles for financial market regulation and for social policy, and to develop closer collaboration with other international agencies, notably the ILO.

Mr. Camdessus’ comments in yesterday’s Press Conference provide the beginnings of a response, but trade unions need to engage in a sustained lobbying effort with their governments to ensure that a strong social dimension, incorporating the commitments to the Copenhagen Summit does indeed inform the new international architecture, as called for by the ICFTU’s statement to the Spring meetings.