The World Bank funded a project in the Indonesian island of Sumatra whereby they loaned a

palm oil company named PT Asiatic Persada. The project was funded by the World Bank to the
tune of over $145 million dollars in an effort for the parent company to expand its planting and
processing operations. This project would require that several villagers be evicted from their
homes in order for the production of such palm oil. This eviction was carried out by government
security forces and employees of captioned company in the middle of night where bull dozers
demolished houses to the ground, ringing gunfire shouting the villagers should run. Several
children, parents and adults were removed and forced to settle miles away from their homes.
This had several negative impacts on the children and adults alike. There was nowhere to sleep
safely, their food had been destroyed, their clothes gone and no money. This atrocity also left
children and adults with psychological effects as they relive the moments in their minds. These
negative impacts may have not been fully avoidable but they certainly could have been reduced
by putting in place check and balances along the way of these projects. The world bank needs to
not just release these funds at once to these projects, they should set benchmarks or rules which
is mandatory and be met to the satisfaction of the world bank before releasing more funds.
Examples as such are , it has to be guaranteed that people who are displaced be moved and
settled elsewhere before funds are least for phase one of such projects. The well-being as it
relates to education, jobs and food have not been hampered by relocation to severely. Only when
these conditions are satisfied then additional funds are released to move to phase two of said
project. This institution I believe is necessary as its an avenue of improving people’s lives
through such projects, it’s just that it has to be regulated every step of the way. The world bank
should also form local committees within in the communities that these projects are being
undertaken and demand feedback as it relates to their human rights and well-being along the
way. I believe with this approach some level of accountably and prevention can be ascertained. It
is important that it is conducted throughout the project and not at the end to receive complains
which become difficult to prove or after the money has gone through the door so to speak. It is
also important for these lending arms to impose tough sanctions and penalties attached to these
loans if people’s human rights are violated. For example, moving interest rates that can become
high for each proven violation, projects can be halted and transferred to other worthy investors,
profits or shares will be awarded to persons who have been violated. With these tough measures
I believe these companies and the world bank would be kept in check and as a result would
reduce the problems caused due to their lack of supervision and enable to continue their lending
unbiased in good conscience.
Consider the goals and the criticisms of the IMF and the World Bank. Do you feel that their
practices are required for accountability purposes, or do you believe that they unfairly threaten
the sovereignty of certain nations? Justify and explain your opinion. Your response should be a
minimum of 300 words.

I do believe that these practices or austerity measures that are tied to these loans by these
institutions are intended for accountability purposes. These practices are put in place to ensure
that these countries do not misappropriate funds they borrow, also to ensure that they can
service their debt and also not find themselves in a similar situation due to these reasons and as
a result develop a prolonged dependency on the IMF or World Bank. While I do believe in
instances that they threaten the sovereignty of certain nations it is also my belief it is not with
intent. With some of these measures they place on the loans given to stabilize the economies
of the countries, they force policy makers to implement unfavorable polices within their
economies that can have not only political effects but can also create social and economic
problems for the lively hoods of many people. For example, IMF programs can consist of
measures which force a government to cut their wage bill in their public sectors leaving a lot of
workers unemployed and not able to provide for their families. One of the side effects here is
that unemployed persons may become vulnerable to participate in illegal activities. Another
example is forcing the government to devalue its currency in order to make exports more
competitive and appear cheaper with the side effect resulting in imports (food, raw materials
etc.) becoming more expensive which in turn inflation is more likely to occur. These measures
implemented by the IMF can also be seen as fair requirements as they try to uphold their
guiding principles of primarily providing economic stability, growth and development which is
often referred to as being a part of the “Washington Consensus” from these loan polices.
Ultimately when the goals and criticisms are compared it’s clearly not a one shoe fits all but it
shows that it requires carefully thought out plans to reduce the risk of a nations sovereignty
coming under threat by these policies.