As the UN watched its political influence wane, the IMF, the World
Bank, and the GATT – which became the World Trade Organization
(WTO) in 1995 – saw theirs wax considerably. In two decades, these
bodies were able to establish themselves as the main “globalizers.”^71
For the right, two main reasons justified the realignment of forces
within the multilateral system. To begin with, the economic expertise
of the Bretton Woods institutions was deemed unquestionably
superior to that of the UN. Specifically, the mainstream, neoclassical
approach of these institutions appeared better able to address the
needs of poor countries. Second, conservatives believed that the
strengthening of the Bretton Woods institutions would improve
the cohesion of the international system by allowing the rich countries
to play a more important political role. Indeed, the voting power of
member-states in the IMF and the World Bank is directly proportional
to their economic power. The United States, in particular, occupies
a dominant position in both institutions, since no major decision can
be made without its consent. At the GATT–WTO, decision-making
procedures are formally more democratic but they remainde facto
“weighted...in favour of the major developed countries.”^72 By
acknowledging more frankly the link between wealth and political
authority, the new multilateral setup seemed to provide the govern-
ance of development with a more rational operational framework.
The Third World debt crisis of the early 1980s strongly contributed
to the rising influence of the IMF and the World Bank. It should be
recalled that in the North, this crisis was often said to jeopardize the
very foundations of the international financial system. The govern-
ments of the G7 thus felt compelled to urge the international financial
institutions to be stricter with borrowing states. This new approach
led to the inception of structural adjustment programs, which over the
years imposed a series of stringent economic and political conditions
on nearly a hundred debtor countries. The GATT–WTO, for its part,
was able to become a potent political force because of two converg-
ing factors. For one thing, the adjustment policies advocated by the
international financial institutions always favored free trade and
(^71) Ngaire Woods,The Globalizers: The IMF, the World Bank and Their
Borrowers, Ithaca, Cornell University Press, 2006.
(^72) Margaret P. Karns and Karen A. Mingst,The United Nations in the Post-Cold
War Era, second edition, Boulder, Westview, 2000, p. 130.
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