The partnership of the Central Bank and the World Bank in the Philippines: a critical study.

Abstract

The World Bank and the Central Bank are both banks but with distinct functions. They may have diverse roles but in the Philippines’ case they have close ties to each other. The World Bank facilitates the investment of capital for productive purposes. It has been offering development assistance in the country for decades now but the country still remains in poverty and underdevelopment. The World Bank has intervened in the major sectors of our country, such as economy, agriculture, health, education, infrastructure, environment, and finance among others, one way or another. They started to build their relationship with the country through offering development assistance provided that the country adopts structural adjustments and reforms. They increased their influence in their efforts in giving policy advices and assessments to their member countries. Through the years they developed certain themes and certain areas to focus their support and assistance, their instruments may have evolved but their core remains, neoliberal and free market policies. They increased their influence especially in the financial sector claiming that it will promote more growth and development but it is apparent that it worked for the private interest and failed to work for the marginalized. In the midst of their strong influence in the country, the question on the World Bank still remains. Is the western-inspired neoliberal paradigm and development model brought by the World Bank doing more harm than good? This study looks into the partnership of the World Bank and the Central Bank beyond technical assistance and policy advises that links them. It highlights the effects of the Structural Adjustments made in the 1980’s and how it resulted in the present condition of the financial and banking system of the Philippines.