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Establishment of the International Finance Corporation: A Case Study

Published online by Cambridge University Press:  22 May 2009

B. E. Matecki
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Extract

This article presents briefly the findings of a case study in which two questions are investigated:

a) Did the idea of an International Finance Corporation, first publicly expounded by the United States International Development Advisory Board, have its source in a United States agency or in an international organization?

b) What were the causes of the modification of policy announced by the United States government on November II, 1954, when it decided to support the establishment of the International Finance Corporation, and did international organizations have any part in bringing about this change of policy?

Type
Articles
Information
International Organization , Volume 10 , Issue 2 , May 1956 , pp. 261 - 275
Copyright
Copyright © The IO Foundation 1956

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References

1 For details going beyond the brief outline of findings, the readers are referred to the full study when it appears in published form giving the background of the story and the documentation. The information that has been obtained is largely based on interviews with many of those who have had a leading part in the history of the case.

2 The case study is part of a larger project sponsored by the Center for Research on World Political Institutions,Princeton University. It is being conducted under a grant from the Merrill Foundation for Advancement of Financial Knowledge. The author gratefully acknowledges the generous assistance received from the Merrill Foundation and the invaluable helpfulness of the Center.

3 Wright, Quincy, Problems of Stability and Progress in International Relations, Berkeley and Los Angeles, University of California Press, 1954, p. 8Google Scholar.

4 This test seems to be suggested by Quincy Wright. In discussing the requirements for international peace and security, he argues that “each nation must prepare to subordinate in some measure its peculiar institutions and values to universal institutions and values if it wishes to save them at all”; ibid. ,p. 15.

5 For an excellent analysis, see the statement on the IFC by Robert L. Garner, Vice President of the International Bank for Reconstruction and Development, at the Tenth Annual Meeting of its Board of Governors in Istanbul on September 15, 1955.

6 Henceforth called the International Bank or the Bank.

7 Cf. the statement by Vice President Garner of the Bank cited in footnote 5.

8 Henceforth called the U.S. Advisory Board or the Board.

9 Henceforth called the Nelson Rockefeller Report or the Report.

10 UN Document E/CN.1/65, Annex, April 12, 1949.

11 The quotations are based on interviews with direct participants.

12 The split in the government has been described here on the basis of the position taken by policy-making officials of respective departments and agencies. It is the position of those officials that was translated into departmental policy. On the working level within departments, there was frequently substantial divergence from the officially adopted line of policy.

13 Several participants in the meeting have described to this writer what they called “the great impression” made upon those present by the ardent pleas of the under-developed countries.

14 The essentials of the “Black Plan” have been obtained on best authority. Other interpretations of the “Plan” which identify it with the original IFC proposal are incorrect.

15 See Recommendation for the Rio de Janeiro Conference prepared by the Preparatory Group appointed the Secretariat of the Economic Commission for Latin America, UN Document E/CN.11/359, p. 131–133.