Advocacy Brief
Oct 10, 2023The Outsized Role of the Bretton Woods Institutions (BWIs) in Global Economic Governance
*This is an abridged version of a chapter in the forthcoming November 2023 report: Critical Trends Towards Feminist Economic and Climate Justice
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Since their inception at the 1944 Bretton Woods Conference — a process led by the colonial Global North and attended by only 44 countries — the Bretton Woods Institutions (the World Bank and International Monetary Fund) have held significant sway in global economic governance. Their colonial roots manifest in a democratic deficit in decision-making, leading to limited resource access for Global South countries and the imposition of strict austerity measures to impose control on public spending through loan conditionalities. These measures disproportionately impact low-income countries consigned to IMF programs with little influence on decision making. Within those countries, IMF directives disproportionately affect women and gender-diverse people, by reducing access to decent work and gender-responsive public services.
A feminist agenda for economic and climate justice challenges the BWIs — and their recently developed agendas for gender, climate, and internal reform — as directly contributing to the harm of people and planet. Redressing and transforming this role is a fundamental precondition to a more democratic and feminist global economic governance structure.
The IMF has long been criticized by civil society activists and Global South countries for its one-dollar-one-vote, quota-based decision-making structure. Around 36 advanced and high-income economies have the strongest voting share in the IMF and hold approximately 59% of IMF votes. Any proposed reforms of the IMF and their role in global economic governance will be insufficient without meaningful quota reform.
Since the introduction of Structural Adjustment Programmes in the 1980s at the direction of the United States, the IMF has frequently attached policy conditionalities in their lending to developing countries. Much of these conditionalities include harsh austerity measures, stipulating reductions in public expenditure — which have increased poverty and income inequality. Due to their dominant role in IMF decision-making, advanced economies determine the conditions attached to IMF lending — without ever having to take on IMF policy advice or endure the effects of these conditions themselves, as illustrated by the figure below:
The World Bank’s new 2023-2030 Gender Strategy attempts to provide a focus on care and social protection in the Bank’s approach to poverty reduction and inclusive growth.10 It has drawn much criticism, primarily because the Strategy fails to consider the gendered impact of the World Bank’s own role in development policy financing, including its recommendations for fiscal consolidation and regressive tax focused loans. It also tends to reduce women to “untapped sources of income.”
Similarly, the BWIs’ increasing push to position themselves as key actors in climate finance ignores their historic and ongoing role in entrenching fossil fuel capitalism. The World Bank has invested US$15 billion to support fossil fuel projects and policies since the Paris Agreement. In 2022 alone, it is estimated that US$3.7 billion in trade finance from the World Bank went to oil and gas. The IMF and World Bank cannot serve as agents towards gender, climate, or economic justice so long as they fail to interrogate where their own interventions are causing harm.
*Our forthcoming Critical Trends report illustrates the significant gap between the contemporary global order and the vision put forward by the Feminist Action Nexus and our allies. The full report will be available in English, Spanish, French, Arabic and on an interactive web platform in November 2023. Learn more about the Feminist Action Nexus for Economic and Climate Justice here.
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