Right cause, wrong battle

JIM KIM, the president of the World Bank, wants it to promote gay rights. He has declared the “fight to eliminate all institutionalised discrimination” to be an “urgent task”. He recently put on hold a $90m loan to Uganda’s health sector after its government introduced one of Africa’s most draconian anti-gay laws. He has ordered an overhaul of the bank’s lending policies to make sure that no loan assists discrimination. At this week’s Spring Meetings in Washington, DC, he is convening discussions with gay activists on how best to do so.

As an early proponent of gay marriage, this newspaper shares Mr Kim’s sentiments. Bigotry is abhorrent and laws that entrench it should be condemned. Uganda’s new law, which allows a maximum sentence of life imprisonment for anyone convicted of homosexuality and requires citizens to report anyone suspected of being gay, is particularly awful. Nonetheless, Mr Kim’s initiative is misguided. The World Bank is a technocratic development organisation, not a place for political advocacy. Setting up gay rights as a test of its lending decisions is likely to make the bank less effective at what Mr Kim himself has emphasised is its core job: tackling extreme poverty.

The bank’s technocratic approach is a big part of its DNA. Its founding documents prohibit “political activity”, however unpleasant a regime might be. Only “economic considerations” should be relevant to lending decisions. That does not, by itself, preclude it from opposing nasty laws. You can draw a link from fighting bigotry to alleviating poverty. Unfair treatment of groups of people, whether on the basis of gender, race or sexuality, leads to their social exclusion, which in turn is likely to harm economic growth and make it harder to alleviate poverty. By this logic the bank has, rightly, long been pushing for the education of girls. The fight against other forms of discrimination can be justified on the same economic grounds.

A rainbow of reasons

But even if it can be justified in principle, Mr Kim’s focus on gay rights is likely to be counterproductive in practice, for three reasons. First, it seems capricious. Uganda is hardly the only country with anti-gay laws on the books; nor is it the only one to have recently toughened its anti-gay stance. Almost 80 of the bank’s member countries, including most in Africa, have legislation that discriminates against gays. In many places the laws are ignored, but several places, notably Ethiopia and Nigeria, have recently introduced stiffer anti-gay statutes. Uganda’s behaviour is odious. But it is not alone.

Second, the stress on gay rights itself seems arbitrary. Of the many forms of bigotry the bank could battle, it is not clear that anti-gay laws are the most harmful to the poor. The bank lends to plenty of places that discriminate against women under Islamic law. It also lends to countries with laws that discriminate against minorities. The economic impact of these forms of bigotry is far bigger. But if Mr Kim tries to tackle all institutionalised discrimination by withholding lending, he will soon have no customers left.

Third, his approach is likely to backfire. In the short term, it weakens the campaign to lessen poverty. Uganda’s loan, designed to support maternal-care clinics, was the equivalent of 20% of its health budget. And it still has a high child-mortality rate. Politically, the pressure from Mr Kim, though winning plaudits in Washington, is having perverse results, where it matters most. Uganda’s government declares itself to be standing up against the arrogant imposition of “Western values”. The more the World Bank adds such conditions to its lending, the more African countries will be inclined to seek money elsewhere, not least from the no-questions-asked Chinese.

The uncomfortable truth is that an economic institution like the bank has to pick its battles. There is a limit to how many conditions outsiders can attach to their aid. Its aim is to encourage economic development. Most of the evidence is that the bank is most effective when client countries see it as an economic partner, rather than a boss imposing a Western agenda.

Ironically, at one level, Mr Kim seems to realise that. He is sponsoring a big management reform designed to make the bank better at finding the most promising solutions from around the world to help countries develop faster. Launching a battle for gay rights may salve consciences, but will make it harder to achieve that goal.