World Bank chief stresses "responsible stakeholder" role in new landscapes

World Bank President Robert Zoellick on Wednesday called on all countries to become " responsible stakeholders" in the shifting global economic and political landscapes, so as to better solve pressing current and future challenges. "Adapting to this new world is about recognizing that we must all be responsible stakeholders now," Zoellick contended, using a term that he first applied in 2005 to China's emerging role in the global system. In a curtain-raising speech at George Washington University ahead of the annual meetings of World Bank and the International Monetary Fund (IMF) slated for late Sept. in Washington, Zoellick noted that the world has changed dramatically since 1944, when the Bretton Woods system was created for the global economy. "If we do not get ahead of events; if we do not adapt to change; if we do not rise above short-term political tactics or recognize that with power comes responsibility, then we will drift in dangerous currents. That is the lesson of history for all of us, developed and emerging economies alike," he said in addressing a large group of professors, students and media. Developing countries are no longer colonial dependencies but take a growing share of the world economy. They are attaining a bigger say in how the world is run and providing development solutions to others, while remaining home to billions of poor people, the World Bank head said in his speech entitled "Beyond Aid". In his thought-provoking speaking style, Zoellick cautioned that developed countries have yet to fully recognize these shifts and still operated under a "do what I say, not what I do" policy. "The new 'normal' will be 'no normal'" he noted, adding that the "new normal" will be dynamic, not fixed with more countries rising and shaping the multilateral system. The rising economies will be joining new networks in diverse combinations and changing patterns, and the new networks are displacing the old hierarchies. He charged that developed countries preached fiscal discipline as huge gaps yawned in their budgets; they advocate debt sustainability, but have debt levels at historic heights. With the global economic growth in low gear largely due to fiscal and sovereign debt headwinds in developed economies, Zoellick challenged that European countries were resisting the obligations that came with a single currency, while Japan had resisted reforms that would retool its stalled economic model, and the United States faced soaring debts but had yet to agree on an approach to cut the drivers of that debt. He held that a world "Beyond Aid" recognizes that the old, hierarchical world is gone and has been replaced with a transformed set of relationships between developed and developing nations. It is a world in which sound policy can be more important than money. "At the international level, it means multilateral innovation to forge progress on open trade and investment, access to energy, food security, competition in services, and climate change-- not always waiting for all to join, but moving ahead where coalitions of progress are possible," Zoellick said, adding that it means using the multilateral system, including the G20, to look at new policy and financing possibilities.