Development

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DEVELOPMENT ASSISTANCE AND LABOR LINKAGES

Overseas Private Investment Corporation
World Bank Conditionality

ILRF advocates the promotion of labor rights in development. Where the neoliberal development model prioritizes corporate capital gain at the expense of workers and pushes policies that create harmful downward pressures in labor markets, we at ILRF believe that there is a more sustainable form of progress. Thus, as development challenges grow in this changing global economy, so too do we seek new instruments to promote labor rights through development assistance.

OPIC: Overseas Private Investment Corporation

ILRF has worked with the US’s Overseas Private Investment Corporation (OPIC) to uphold internationally recognized labor rights in OPIC programs. OPIC is an independent US government agency that assists US businesses and investments overseas and stimulates development in emerging markets. According to the 1984 Trade Act, OPIC is prohibited from supporting any project that contributes to a violation of internationally recognized workers rights in the host country. The ILRF has worked with OPIC to ensure that this law is upheld.

In 2000, OPIC contracted the ILRF to perform a thorough assessment of worker rights in Equatorial Guinea, where OPIC had begun to process an application for financing and political risk insurance to support the construction of a methanol plant by AMPCO. OPIC was concerned that although the laws of Equatorial Guinea recognized fundamental worker rights, the laws were not always enforced. OPIC specifically noted ongoing country practices that limited the exercise of the right to freely associate.

See the report which details the ILRF’s findings

World Bank Conditionality

The World Bank is a powerful agent in the world economy, affecting the global North and South alike with its unilateral development policies. World Bank loans to developing nations are given only on certain conditions. The ILRF, alongside a growing group of others who are concerned, works to challenge these conditions-- which often do more harm than good to individuals in developing economies. Specifically, ILRF has serious concerns about the largely detrimental effect of World Bank policies on workers.

World Bank policies have standardly lacked an understanding of the imbalance of power between employers and workers. The bank has conditioned its lending upon borrowing countries removing obstacles to the entry of foreign capital, particularly FDI, but it has not, at the same time, attempted to assure core worker rights. It has thus seemed to implicitly condone the abuse of worker rights—which have been rampant in such “model” borrowers as Mexico and Indonesia. The Bank has failed to recognize the nexus between its promoted development model and such abuses. The ILRF has been critically engaged in exposing the effects of these influential, unilateral policies.

See ILRF’s criticism of World Bank’s 1995 Development Report on Global Workers