94016
                                                  v4



THE WORLD BANK GROUP HISTORIAN'S OFFICE


           ORAL HISTORY PROGRAM




            Transcript of interview with




            EDWARD V.K. JAYCOX / /

   February 23, March 9, April27 & May 24, 1995




        By: Jochen Kraske & Lou Galambos
                   EDWARD (KIM) JAYCOX INTERVIEW
                          THE WORLD BANK
                           May 24, 1995

     Q:      You hadn't been away from your African activities

very much, but you did take a break due to the reorga-

nization. When you returned, if you could give us an idea of

what you found.    You do have something of a mandate from the

reorganization.    There were objectives and you must have had

those in your mind.    So if you could tell us what things

looked like and what you saw as the problems.

A:   Well, I was named Vice President, Africa Region.       I was

in charge of a combined Western and Eastern-Southern Africa.

 Eastern-Southern had been the name of the region I was Vice

President of before the reorganization. Wilfried Thalwitz had

been in charge of the Western Africa Region, and went from

there to EMENA.     It was only four months really between the

start of the reorganization business and nominally I had been

Vice President of the Eastern-Southern Africa Region even

while I was in charge of the reorganization.       Nobody took my

place.    Somebody must have been Acting.   I can't remember how

we did it.    But when I came back it was an entirely different

thing.    We went through the business of "farmer takes a wife,
                            WORLD BANK - JAYCOX 5/24/95    Page 2

wife takes a child" process in the staffing of the new

organization. So in the summer of 1987 we were busy making

all of these personnel choices and putting the thing back

together.     The new region combined the two previous ones.     It

also brought into it a little unit that had been in the

President's office or Senior Vice President of Operations'

office.     This was the Africa unit.   I can't remember what its

name was.

Q:   That was part of the decentralization?

A:   No.     That had been a sort of a cockamamie arrangement,

because Sub-Saharan Africa was split into two.     There was no

locus for common issues, such as raising resources for

Africa. I think that this office had been established because

of a special program or joint financing program.     The

previous IDA replenishment was not a fulsome replenishment

and the Europeans made up the difference between what their

burden sharing would require them to contribute, and what

they wanted to make sure Africa had by inventing this special

joint financing facility. This unit was in Ernie's office, to
                          WORLD BANK - JAYCOX 5/24/95     Page 3

allocate and administer these funds. That unit evolved to the

Africa Region.

     We also had a technical department and in my opinion at

least we had a very important backlog of unaddressed policy

issues in Africa.

Q:   Could you go through a few of those?

A:   The way I saw it, most of the Bank's policies were never

refined consistently for application in Africa. Yet the

underlying institutional weaknesses, the lack of consensus

within Africa, was such that we were having a troublesome

time applying what looked like perfectly sane Bankwide

policies.   But because of the classification of the region

there was never one person in charge to focus on this issue.

That was one of the reasons, in fact, why the reorganization

recommended the merger of the two Africas. No matter what the

quality of the individuals in charge of separate Africa

regions, the fact is that you end up with the lowest common

denominator when you solve common issues. The two sides

either agreed or they had to go to the Senior Vice President
                          WORLD BANK - JAYCOX 5/24/95      Page 4

for Operations, who had rather limited time to address

African issues.

     So one of the hallmarks of the reorganization in 1987,

was the creation of a region that had room for valid

generalizations, where you could have valid policies with

some refinement. So we set about defining our approach in

education and health, family planning, most of the main areas

that we needed to address in Africa, basically adapting

Bankwide issues.   Sometimes we kept looking at special

problems. For instance, I remember we took on AIDS and some

of these other issues long before the Bank as a whole did. We

built a capacity to deal with that issue very early on, we

sort of invented that.

Q:   Could you fill that out with a little detail?

A:   First of all, we had a very gung-ho management team,

because of the way the selection had taken place. It was a

magic moment, everybody had chosen to be here or was chosen

to be here.   It was a neutral decision to be here.     Nobody

inherited somebody else's crew and had to live with it.

Although the team started changing almost immediately, it was
                             WORLD BANK - JAYCOX 5/24/95     Page 5

wonderful the way we got off, because this time was so

stressful that we spent the whole summer and nobody took one

day of leave.     There was a kind of lifeboat mentality and the

Bank was an exciting place for several months, and years

maybe.    There was so much to do.

     We had     brought into Africa a number of young managers.

Sven Sandstrom was a director, Calisto Madavo was a director,

and Caio Koch-Weser was a director.      These guys had been

involved in the reorganization task forces.      So a number of

the Africa managers were fully committed to the reorga-

nization and the way it was supposed to operate at the

regional level.     So this region really did take advantage of

all that.     I didn't have to spend a lot of time convincing

people.     It just moved.   And I think we made, in a couple of

years, really quite outstanding progress on a lot of fronts

for Africa.

     We also launched during this period, a major thing

called the "Long-term Perspective Study" on Africa.        We in

the region were worried that the IMF programs were

concentrating on short-term balances, getting those balances
                           WORLD BANK - JAYCOX 5/24/95      Page 6

at the expense of the long-term development objectives, and

we needed to lift our eyes off the crisis and put things into

 perspective.

     We also invented the SPA during 1987.     We had our first

meeting at the end of 1987.    This was handled by the group

that came from Ernie's shop, Xavier de la Renaudiere and

others.    Although Xavier retired in the context of the

reorganization, he did stick around and Phil Birnbaum, who

was in that group at the center, came over and we launched

the SPA.   Moeen Qureshi providing some leadership, I had to

carry the ball and make something out of this.

     The SPA is a very important achievement, in the history

of the Bank, as a matter of fact.     The ideas were just

dawning at the time of the reorganization.     There were a

number of people who could legitimately claim paternity for

these ideas, including Ernie and Xavier.     The idea was to

bring all the donors together in support of structural

adjustment in Africa. Something that the other donors were

not willing to support.    They were not willing to provide

balance of payment type of support.    All of the professionals
                            WORLD BANK - JAYCOX 5/24/95      Page 7

from the aid agencies were against that and we didn't have

enough money to support these programs.     The real reason to

turn everybody around was this long-term perspective study.

It underlined that instead of just getting the balances right

we were interested in getting growth and some forward

movement.     The basic problem was that you can't steer a

parked car.     You've got to be moving before you can get any

real adjustment.    And, I mean moving forward, for they really

were moving in a negative sense.     In fact, Africa was going

down the hill, so to speak.     That was happening because in

getting the balances in the short run we were constantly

cutting expenditure. There was not enough time to develop the

capacity to raise taxes and start domestic resource

mobilization.    Government had lost its authority in most of

these countries anyway, so the only thing to do was cut

expenditures, cutting costs, and of course that was basically

leading us to a balanced budget of zero. We were going to

have no government, no schools, no roads, no nothing, and

this was the way we were headed and rather rapidly.       So we

had to turn that around.
                           WORLD BANK - JAYCOX 5/24/95     Page 8

     We had to identify the gaps in these countries in the

context of some growth, per capita income growth.    And we did

not see that we could continue to compress consumption or

continue to make indiscriminate cuts in expenditures.

Q:   Sometimes there is tension between per capita growth and

poverty alleviation.

A:   Oh, yeah.   But you need both.   You are not going to get

any poverty alleviation without per capita growth. That is a

definition of policy, because on average these countries are

at or below the poverty line, the average income is below the

poverty line.    So this is not a sophisticated concept,

without getting into purchasing power parities and all that.

But the margin is so minor that it's not worth talking about.

 It would be much easier to get growth than it would be to

reallocate this paltry pie.    People would kill each other

over their crops already. In the circumstances, it would be

much easier to get growth.    This was staring us in the face.

These countries had a lot of potential, but the IMF programs

that we were dealing with were going in the wrong direction.

 It was not the Italian model where you change your exchange
                          WORLD BANK - JAYCOX 5/24/95      Page 9

rate and thousands of people go into leather goods or

something, and then the balances are corrected and everybody

is back to their old standard of living.     This is not what

happens in Africa.   We don't have the infrastructure.    We

don't have the human resource development.      We don't have the

management capacity to make those things happen.

Q:   Were you dealing directly with the IMF on this?

A:   Yes. And this was a confrontation. But we finally got

them on board when they realized that if you took these long-

term projections this becomes obvious. Shortly thereafter we

had to invent the PFP.   That was invented for Africa because

they were done only in the context of IDA countries. Africa

is where the action is for IDA. So once we had these programs

working, we could see the trend turn around. We never saw

before that the per capita growth would turn around because

with the lower levels of expenditure, we were cutting right

into the bone and muscle of these economies.

     So we invented this SPA, and this was a very creative

thing.   It recognized that we needed growth.    It recognized

that the gap had to be defined, it had to be filled, not in a
                           WORLD BANK - JAYCOX 5/24/95      Page 10

balancing but in a satisfactory scenario. That was the

starting point and it meant a bigger gap because it had to

have enough juice in the overall scenario for growth to take

place, per capita income growth, which meant that growth had

to be higher than the population growth rate by at least one

percent.     That was our objective.   Minimal objective.   And we

guaranteed to any country that was in bona fides adjustment

that they would get the funding that was needed theoretically

to achieve that.

       Now we are in our third replenishment of this SPA. It

has done just that guaranteed the needed transfer of

resources.     Every gap has been filled.    There have been some

slips, and some untoward events on occasion, but by and large

it has     worked. The reason it succeeded was that the

bilaterals were allowed to remain bilaterals.      They didn't

have to turn their money over to IDA.       They made their loans

directly to these countries.     They got credit for what they

did.     They got to pick the countries they favored, and not

had to contribute to some general pool. The World Bank, or

IDA rather, acted like an underwriter.      We were ready to move
                        WORLD BANK - JAYCOX 5/24/95      Page 11

to the unpopular countries provided they were in bona fides

adjustment, and let the other donors carry their favorites,

where we would reduce our participation in order that there

was enough money to make this guarantee work for all the

countries.

     We had up to about 30 countries in this program, and we

still have 28.   They are moving, sometimes very slowly, but

they are moving. For those 28 countries, the freefall that

Africa was in in 1987, has been reversed. Most of them have

growth rates over four percent.   This is despite the fact

that during this period of time, I'm talking about the five-

year period from '87 to '93. We had the worst economic

recession since the Thirties. The most prolonged at any rate,

where Africa was coming from a totally disconnected situation

with the world economy, to some measure of integration.      I

think this has been a major success story in terms of

partnership, in terms of mobilizing resources.

     At the first meeting in '87, I remember, we got a $6.6

billion pledge out of the donors at that meeting. About half

of that could be considered new money in the sense that it
                             WORLD BANK - JAYCOX 5/24/95   Page 12

would be disbursed so rapidly that it would amount to a

doubling of their commitment to Africa. You can see it in the

aid statistics, all of a sudden the amount of money flowing

to Africa went way up.

     A very comprehensive approach, too, in the sense that it

took account of export proceeds, debt rescheduling, all the

sources of finance that were available, and all the donors.

And the donors got, in return for all of this, the collective

security of the group supporting these highly risky,

controversial reform programs with a lot of political

overtones.   We did all the dirty work.      They got the credit

for supporting things, after we had negotiated the deal.

Q:   Did they know that before the deal?

A:   Sure.   That was clearly stated that that was what we

were offering.     That's one of the reasons they were able to

participate. Part of the prejudice against this kind of

policy-based lending was that the donors knew that one

country cannot stick its nose so deeply into the affairs of

another country, that only the Bank could probably get away

with that.   The   u.s.   tried, and even they couldn't. Even with
                         WORLD BANK - JAYCOX 5/24/95     Page 13

the smallest African country they just lost so much on the

other side in terms of their other objectives, vis-a-vis each

of these countries, political, business, trade, whatever,

votes in the U.N. They lost so much when they became that

intrusive that it wasn't worth the candle and the State

Department did not support AID's involveme.nt.   They could

have the rhetoric but they couldn't have the conditionality.

 But we provided the conditionality which rounded things out,

and everybody could go in there and say, "Oh, gee, the World

Bank and the IMF have been really tough on you guys, but we

are really proud of the fact that you are making this effort,

and here's our support to make sure this is going to work."

So this was a win-win situation. I don't know if we thought

all this through, but it turned out to be brilliant in terms

of its effects.   Now we cite it as the most successful aid

coordination venture that the Bank's ever been involved in.

     We were basically also trading for them information that

they didn't otherwise get.   What they got was a biannual

readout of the cash flow situation of 30 countries in Africa,

including how the gap would be filled, or what remains
                            WORLD BANK - JAYCOX 5/24/95     Page 14

unfilled, and a listing of all the other donors and what they

are putting in.      So the British could look and see what the

French were doing and the Americans were doing, and so forth,

in each of these countries.      And because the money was not

pooled in any way, and since they determined which countries

to support, there was no talk about burden sharing of any

kind.

Q:      It was a self-generated approach.

A:      Yeah.   Well, the whole thing was very congenial.   Nobody

was expecting, like they do in IDA, that the United States

would be as heavy on the ground as France and Britain in

Africa, so there was no burden sharing concept to begin with.

 Everybody wanted and nobody was worried about how soon it

would be possible to bring the Japanese in. The second

replenishment was $7.5 billion, and the third one was $7.8,

so we've raised about $22 billion equivalent in the three

replenishments.

        So that's one of the major achievements, being able to

talk about Africa.      I don't think that would have happened

without the merged Africa region, because the amount of work
                           WORLD BANK - JAYCOX 5/24/95   Page 15

required to generate that information and consistently hold

control of the quality of that data just couldn't be done by

two separate regions. I don't think you would have gotten the

energy behind your program.

Q:   But it also put you in a key position in terms of

negotiating.     You could negotiate for that whole entity.

A:   Right.

Q:   And you were in a lot better negotiating position.

A:   Oh, yeah.     If I were down the line in the organization

that would not work. But if you take the guy who was going to

operationalize the thing, put him also in the chair for

raising the money, this really increases your credibility

with these donors.     Some central Vice Presidency or other

force would have to deal in abstractions and would not be as

effective.     We were able to go to these people and say,

"Okay.   This is the status in Burundi today."    "This is the

status in Malawi today."     We would have meetings on each of

these countries, each of these cash flows, the nuances of

these countries, and we developed this information system

which the donors needed.
                           WORLD BANK - JAYCOX 5/24/95    Page 16

Q:     You are dealing donor to donor, you are dealing with one

donor at a time, or are you dealing with them in groups?

A:     All together--and one-on-one--in the sense that each one

gets the entire picture.     Each one sees what everyone else is

doing and what we are doing.      They are able to ask questions,

they are able to say, "Why are you slowing down here?      Are we

all together on this?"     The amount of communications between

us and the donors was expanded just a thousand-fold.      Each of

my directors has a responsibility to some donors, to know

what their policies are, to be there when it's time to raise

money, be there when it's time to answer questions, get to

know the parliamentary committees that have got the money,

make sure that they understand where we are coming from. So

we have a big outreach program that keeps these guys on

board. We meet every six months, once in Washington and once

in Paris, and we've been doing that for nine years, since

'87.    Eight and a half years.

Q:     Are you satisfied that you had more or less all the

money that was needed?

A:     Yeah.
                           WORLD BANK - JAYCOX 5/24/95      Page 17

Q:   So at the end of the process you could say, money is not

the problem now to get Africa back on course.

A:   Yeah.     Money is not the problem.     In fact, we are not

able to use all the money we've got now.        That's partly

because of the political transitions. The thing is so

dependent upon African performance.        That's Number One.   You

cannot get the money flowing unless reforms are taking place,

so if there's a slowdown of reform there's a slowdown of

money.   But as long as the reforms are moving at a fast pace,

then we could run out of money.     This would be a fortunate

day, in a sense.     This would be ideal.    This would mean that

we got 30-odd countries in Africa going full bore for

economic reform.    And they need a lot of money in order to

make that happen.

Q:   Is your four percent figure the top or is four percent,

the average?

A:   Well, the average. The average growth rate of population

in these countries is a little over three percent. So the

target for reforming countries is minimally four something.

Now, as a matter of fact, nobody is quite on target, so the
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average growth rate is substantially less.    But there are 21

countries with positive per capita income growth over five

years, and that's never happened since 1968 in Africa.

Q:   You do have a fair number of countries, though, that

come in and drop off again?

A:   Yeah, this is always happening particularly now with the

democratic transitions. We've gone from four countries with

governments that are based on contested elections to 30 in

the last four years.   If four years ago you had said that

there were going to be 30 countries in Sub-Saharan Africa

where, you had oppositions in the parliaments and governments

based on national elections which were contested by

opposition parties, you would have been laughed at.    This was

a big surprise.

     That's a phenomenon that marks the end of the Cold War

where basically every African government was dependent upon

some outside power for its legitimacy domestically.    That

meant that Mobutu could get away with bloody murder inside

Zaire because he had a Big Brother outside.   He didn't have

to worry about what his people thought.   Now, at the end of
                           WORLD BANK - JAYCOX 5/24/95   Page 19

the Cold War, that game was finished. So each of these

regimes has been destabilized and is looking for ways of

legitimizing themselves domestically. Some of them tried to

go to the ultimate dictatorship, but that has not worked and

most of those countries are in civil war now.     The others

have chosen the democratic option. Some of these are false,

phony developments, but they are easy to spot.     And the

others are legitimate but they are very fragile, and they are

not necessarily performing very well.     So one of the problems

now is that governments are not very capable of making

decisions.     They are less capable than they were four years

ago.

Q:     Democracy is sloppy.

A:     Yes.   And there's a tremendous educational backlog,

because nobody was brought along. In the reform process the

economic side started before this political transition, and

the opposition parties are all against economic reforms.

Economic change is a very painful thing and if they were not

included in the beginning, they naturally develop negative
                         WORLD BANK - JAYCOX 5/24/95        Page 20

views against those changes.   So we are paying the price of

that transition.

Q:   Do you get involved in this democratization process?

A:   Well, we cannot get involved with the politics of this

process. We do not use the word "democracy" very often.       We

use the word "pluralism," though.     We break monopolies

wherever we see them, and this has gone beyond economic

monopolies, it's been applied to informational monopolies

and, by extension it definitely involves political

monopolies.   One way or another, these things are really one

piece. The Bank tries to avoid the appearance of supporting

the opposition per se but stimulating public debate, why we

feel perfectly free to do that.

Q:   How does one stimulate debate?

A:   Well, we give interviews to the press.     The press is now

freer, not free but freer. That means that if I were to give

a speech, that's critical of government, it would probably be

printed now in Africa. I avoid doing that about a specific

African government but I talk about African situations in

generalities so that where the shoe fits, the message is
                         WORLD BANK - JAYCOX 5/24/95    Page 21

heard. The trouble is the shoe fits all over the place, and

everybody knows it.

Q:   That's a fairly recent phenomenon.    You wouldn't have

gotten that kind of publicity before.

A:   No.   Not unless I was the most complimentary commen-

tator. Except for the international press.    I mean, the

international press was always looking for criticism of

Africa and you had to watch it all the time because if you

come across as only critical obviously you are not going to

be very effective.    But the emphasis on governance is now

accepted. We invented the application of that word in this

Long-Term Perspective Study.    I can remember sitting around

with seven or eight really serious, civilian Africans up in a

hotel in Baltimore, and they said, "Look, you cannot publish

a long-term perspective on African development unless you

talk about the quality of government. The governments are a

part of the problem, vampire state, the rapacious vampire

state." This is the kind of language they were using with me,

referring to "the corruption, the mismanagement, the

tribalism, the shunning of professionalism, the shutting down
                         WORLD BANK - JAYCOX 5/24/95        Page 22

of old active mines, the pushing away of young trained

people. All of these things are, the real problem, and if you

do not talk about these things you are not going to be

believed by anybody in Africa.     That's Number One.     "If you

do not talk about the issues you might as well quit."       So

while we wondered about how we could get this into this

report. This was a new departure for the World Bank, to write

about something like this. Dunston Wai was interested in this

angle of exterenal affairs for Africa.     He was there with me

and we were going to search for a word that would talk about

the quality of government.    This word "governance" came up.

"Governance" is more broad.    It has a kind of a positive ring

to it.   Governance is something that is positive.      It can be

bad, but mostly when you talk about governance you tend to

think in terms of the art.

Q:   It is more of a technical term.

A:   Right.   And it has a small "g."    It goes beyond

"government" with a capital "G."

Q:   "Governance" is a lot different than "government."
                        WORLD BANK - JAYCOX 5/24/95      Page 23

A:   Yeah.   So we found this word, and I think we found the

right word because the minute we got it, it went right into

chapter 3 of the Long-term Perspective Study. The Bank has

taken it up and we've talked about governance. Of course,

there are those people who don't like it. In fact, maybe

we've over-used this word now, but at the time it was

capturing something that had not been discussed in polite

circles about Africa, and all of a sudden it was center stage

and indeed we've been dealing with it ever since.

     The way we look at it is that governance has always been

part of our work, in a project sense.   If you make a road

loan, you are interested in the sanctity of the contract, you

are interested in the transparency of the award, of the bid,

the accountability ultimately for the contract and the

procedures in the use of monies.   You are interested in the

ownership by the government of this whole process.    In other

words, governance covers most of the main elements, that

we've got, accountability, transparency, the rule of law,

predictability and sustained policy, the participation of the

stakeholders in the decision-making process.   That's about as
                         WORLD BANK - JAYCOX 5/24/95     Page 24

close as we get to democracy.     But if we can insist on those

things in a project context, we've got all these little doors

and windows into governance.

     Now the issue is if we get into structural adjustment we

are underwriting the whole economy and the gap is what we are

filling.   That means, we have to worry about every nickel

that comes in and goes out.     We have to worry about the

accountability and the transparency and the constancy of

policy, the whole bit.   So we are into governance.    We are

into the issues.   And I think that many governments, in fact,

not all democracies have those features, as we all well know.

Q:   Right.

A:   Certainly not all governments that have multi-party

elections backing them have all these features.     We are more

concerned with the essence of the development role of the

state rather than the taboos of political involvement, the

things we want and the things we don't want when we talk

about governance as opposed to democracy.

Q:   On the question of taboos, there's a contradiction

between getting deeper into the process of the societies,
                           WORLD BANK - JAYCOX 5/24/95     Page 25

particularly with conditionality, and the idea of having

greater client involvement.      There is a certain tension.

A:   Right.

Q:   When we interviewed Ernie I thought there was one very

telling moment where I believe we provoked him, and he said,

"You know, if they knew what to do they wouldn't need the

money."     It was one of those blunt things that you say.     Did

that come up as you developed your dialogue.?

A:   Well, I think, there is always a tension between

conditionality and ownership.      But, if you look at

conditionality as a substitute for ownership, you are dead in

the water.     I don't think that's going to work.   We've tried

it, and we've got a lot of it, and those are the loans I wish

I'd never signed.     In fact,   the whole study on adjustment in

Africa shows that those loans didn't work.      That's why we had

a lot of adjustment lending and very little adjustment.        So I

think that we've changed the way we looked at things a long

time ago.

Q:   Is that because you have now a better formula for

structural adjustment ?
                              WORLD BANK - JAYCOX 5/24/95   Page 26

A:      Well, no.     It is because we were trying to reform these

economies.        Now, I've come to believe it's impossible for us

to reform these economies.        We can only support people who

are reforming these economies. But we cannot reform these

economies.        There is a distinction there.

Q:      Right.

A:      You see, if we decide what they have to do in order to

get the money, that's a formula; it's a substitution of our

commitment and ownership for theirs, and it's not going to

work.        We are anxious about this because we see that time is

money, we see that if they don't reform it's going to cost

more, we are going to run out of money, we are going to run

out of aid, aid fatigue will set in, these people will be

written off. These are legitimate worries.        And yet, they

have to actually do the reforming.        That's the way I look at

it, anyway.

        Q:      You didn't look at that, you didn't look at it

exactly that way in 1987?

A:      No.     Well, the point is you don't want to make the same

mistakes over and over again.        If we make mistakes, I think
                          WORLD BANK - JAYCOX 5/24/95      Page 27

we catch them early and don't repeat them twice.     I don't

expect to avoid altogether making mistakes.     You've got to

remember that we started with this Fund approach where the

whole thing could be done in a few months.     But the Italian

model was not going to work in Africa.     Some of us foresaw

that.    Others hoped that we would get through this.    And

maybe we believed, like the Africans that it was a temporary

crisis, that it would be reversed, that the Americans

wouldn't just say, disinflate the whole world economy. There

were all kinds of things that might have happened if the

world was managed in a different way.     But, it turned out to

be a lot longer, a lot more painful, a lot deeper, the

dangers of adjustment became that we might do it in a wrong,

improper way rather than support real adjustment.       But we saw

the mistakes after a while.

Q:      Presumably the Africans also began to look at things

differently?

A:      Oh, sure.

Q:      Initially they may have said why should we do this? It

hurtG.
                           WORLD BANK - JAYCOX 5/24/95       Page 28

A:   Yes.     And the world is unfair and you've caused all

these problems anyway, for God's sakes.      Yeah.

Q:   And eventually they came to recognize that they really

didn't have any options.

A:   That's right.

Q:   --but to confront these problems.

A:   I think that's correct.      So we didn't have to do all the

reforming by ourselves.     That's another thing that evolved.

But I still think that the real tension, is between the

agenda that we have and the agenda that the Africans have.

We are under pressure from the people who provide our

resources and govern our Bank, the majority of votes, to get

these economies reformed.

Q:   Right.    Achieve results.

A:   To get these girls in school, and get these birthrates

down, and get these environmental action programs in full

swing.    If you go to Africa there's no African minister,

there's no African, there's hardly any African that has that

agenda.     They are looking for where their next square meal is

going to come from. And what's in it for me?         You know, this
                         WORLD BANK - JAYCOX 5/24/95      Page 29

reflects the breakdown of their tribal culture, and we've

reached it pretty fast in some of those places.     But my point

is that our agenda doesn't match with theirs, so reform is a

very tricky thing.   The vast majority never goes for reform.

 It's always a tiny minority that starts this process

anywhere. Certainly that's true inside the Bank as it is out.

 A tiny minority thinks they have the guts and the will and

the determination to make changes.   The   mass are fine.    I

mean, the status quo is the way it is, and they've all made

peace with that or they are voiceless.     So when we get this

movement, we start supporting this tiny minority. Sometimes

this tiny minority needs the conditions in order to force the

rest of the cabinets or the rest of the government or, the

labor unions, or the customs collectors to straighten up and

fly right.   They need that conditionality.    By God, if we do

not do this, if you do not do this, the World Bank is going

to stop the flow of money.   So we end up putting these

conditions on, not only because we want to reform these

economies but we are trying to support those who do.
                           WORLD BANK - JAYCOX 5/24/95    Page 30

Q:   I'm going to stop you right there for just a second. How

good is your intelligence that you get on the political

implications of, say, conditionality of the sort you were

just talking about?.

A:   I think we have very good intelligence.

Q:   Do you?

A:   Yes.     We are probably not experts enough.   We ought to

have more information.     But I don't think there are many

surprises.     The thing is that we are in this hard situation

and the implementation is in the hands of the weaker partner.

 They have to implement.     If they make one false move in

Zambia, if they don't come across with a program that's

credible to the millers, to mill what they call the "roller-

meal", they messed i.t up.    The whole damn thing comes apart

and because of this, our Board sometimes says we don't have

enough conditions while in reality we have too many

conditions.     If we had tried to save the day in Zambia by

telling them how to tie their shoes, you can imagine the

uproar that we would be having about our legal documents

cluttered up with this kind of minutiae. But in fact that's
                         WORLD BANK - JAYCOX 5/24/95      Page 31

where this thing in fact began to unravel big time.    This was

a disaster, from my point of view.   It set the whole thing

back five years, and made what we are doing now in Zambia

just that much more difficult.

     My point is that this tension between ownership and

conditionality is extremely tricky, at least in Africa.     And

I'm sure this is true anywhere where the government is weak,

where the reforming mentality is fragile with few supporters,

where they need a lot of outside support to be successful,

and where the urgency is so great because the alternatives to

adjustment are a chaotic and extremely painful development

for the society at large.   We've got enough of that in

Africa, and we cannot afford to leave that unattended.

Q:   From whom are you getting your best feedback in terms of

ideas and information?

A:   Our customers.

Q:   Any particular people that you've identified as being

particularly important in terms of feedback? You've talked

about how the first part of the structural adjustment ran

into problems and that you felt you needed to get information
                           WORLD BANK - JAYCOX 5/24/95      Page 32

about this, and I'd like a little bit more on your sources of

information.    There must have been certain people you really

found superb.

A:   Well, first of all, I think the staff is an important

source. This goes back to before the reorganization, that the

team working on Africa was always a relatively close-knit

team providing close communication with what's going on out

there in the field. We have 30 resident missions now in the

combined Africa; we've got 400 people working in the field,

in different time zones.     We are practically 24 hours around

the clock working on Africa.

     We also set up this Council of African Advisors that

comes twice a year and gives us a straight assessment from

their point of view.   We are definitely reached out by doing

an awful lot of traveling.     The motto of the Africa region is

"If you don't go you don't know."     There's no point in

sitting around here expecting to know anything.     You are not

going to know anything by sitting behind this desk.      That's

clear.   However, the one consistent theme I've got in my

annual evaluation was that "You travel too much, Jaycox.       You
                         WORLD BANK - JAYCOX 5/24/95     Page 33

are never here when we need you."     Whatever the hell that

means. I don't think they need me around here at all. You

really have to be out in the field.     I get feedback from

ministers, feedback from heads of state.     A lot of this is

inarticulate and problematical and self-serving from their

point of view.    But it is all extremely valuable feedback,

from my point of view.

Q:   There is a tendency for people to cover their ass, and

that, indirectly, was the question I was asking.     How do you

deal with that?   You've got a lot of people and you've got a

lot of money, and you've got a lot of different people with

very different perspectives and motives. Is that the key,

that you keep on the move, that you talk to enough people and

you get 18 different stories, and then you sift them out?

A:   The way we have actually set this thing up really

maximizes the number of inputs, the sources of input.    We

meet twice a year with interested donors on all these

countries, donors who have field offices and points of view

and complaints about the World Bank.    We meet in the field,
                           WORLD BANK - JAYCOX 5/24/95      Page 34

and I do a lot of traveling. The directors also do a lot of

traveling, and visit all of these donors in the process.

Q:      But do the donors ask difficult questions of you?

A:      I think we are constantly under fire. The anecdotal

evidence that they gather, the concerns that they have, they

register everything here with us.     We are not immune from

that.     The customers also have complete access to us here.

We meet with them a lot in the field, and we meet with them

here.     I think communications are good.   We have all these

resident missions.     I think we are the only region, until

very recently the only one, that had anywhere near like this

establishment in the countries, and the job there is to

communicate reality.

Q:      And that's because of the problems of Africa, that you

have more resident missions.

A:      That's because all these countries have structural

adjustment programs and because of all the handholding that

is required, including the feedback that you are mentioning.

 Now, in fact I have at times felt that I was not getting

reality, that I was being sold the Pollyannish stories. This
'




                              WORLD BANK - JAYCOX 5/24/95      Page 35

    is a very serious problem, generally in any bureaucracy. But

    I don't think it's a huge problem in this region. I hope it's

    not a huge problem.

    Q:   You know, you are talking about the structural

    adjustment loans and there is a provision that you can't use

    them directly for debt relief.     Is that the case?

    A:   But that's what we are doing.    We providing debt relief.

         Well, there is no direct debt relief. If you look at

    this SPA document you'll see the total needs of the country,

    including its unavoidable debt payments, the imports required

    for investment and for consumption and to achieve per capita,

    positive per capita income growth.    You add those things

    together.   That's their total requirements in the way of

    money foreign exchange.    And then you've got all these

    outflows including the unavoidable debt payments.       In some

    countries these unavoidable debt payments are huge. But we

    regard them as a legitimate expenditure, you can't regard

    them as somebody else's problem.     Now, the gaps are defined

    in a way that we can associate this money with the imports,

    but in fact in some countries, like Zambia, there's no doubt
                         WORLD BANK - JAYCOX 5/24/95     Page 36

that the amount of money required is greater than the gap

that is required to finance imports. So external assistance

has to go for legitimate debt service, including our own

debt, although we are extremely positive.   So we are paying

other people's debts in addition to the imports.

Q:   We are now coming under fire from these Christian

alliances who claim that our debt really represents the hub

of the problem.

A:   That's wrong. It's numerically correct, but it's a red

herring. I think we'll have to somehow deal with that.    This

has been analyzed to death in fact. What we are doing is we

are substituting World Bank debt for other people's debt. We

are paying off the Paris Club, we are paying off the IMF, we

are paying off the African Development Bank, and where the

hell do they think the money is coming from?   It's coming

from us.   And it's also coming from the SPA donors who are

giving it in the form of a grant.   So this money doesn't show

up as debt. But our one dollar of debt. What goes in is 40

years, 10 years grace, 3/4 of one percent, and it's going in

to replace debt that is four years, 14 percent, four points
                           WORLD BANK - JAYCOX 5/24/95      Page 37

above LIBOR.     Our money replaces the most expensive crap that

is out there.     It's what's on the books of these African

countries.

Q:   But that means that they are then borrowing money at

this time?

A:   No, no.     They are not.   This is all old debt.    In fact,

a lot of it is the capitalization of interest that has not

been paid previously. Once it gets rescheduled, it's beyond

the cut-off and cannot be rescheduled again. It really builds

up. Now, we are trying to change these things.      It's very

much in the interest of IDA, and the Bank, to get this debt,

this heavy, hard debt, out of these economies, because until

we get rid of this debt, our money is going to go to pay off

this debt.     We've got to have a reduction in order to make

sure that our money in fact goes for development;        I think

the NGOs have got it, absolutely upside down.      They do not

understand the role that the Bank has played in this debt

business.    We have been the sherpa.    We have been developing

the ideas.     If you go back to the Trinidad or the Toronto

terms, the Enhanced Trinidad terms, the Naples terms for
                           WORLD BANK - JAYCOX 5/24/95     Page 38

rescheduling, these were all ideas that were developed here.

 Of course, we are not necessarily successful in every case.

 We have not got always found the consensus readily among

donors and creditors.     But, the idea that we are interested

in holding the feet of some country to the fire so that they

pay their debts is just absolutely wrong.

Q:   It is a very common complaint because even the

Chancellor of the Exchequer is making these noises.

A:   Yeah.     Well, the commercial debt is the worst aspect,

but we've got to look at the total debt service. There's a

lot of IDA money out there now in this whole debt.       But what

kind of debt is this, with all these huge grace periods and

no interest practically?

Q:   Soft debt as opposed to hard debt.

A:   Yeah.     You don't add them together to make two, these

two dollars.     It's a very different kind of debt. I just

don't think that the thing has been analyzed correctly. We've

written books about it.
•.




                                WORLD BANK - JAYCOX 5/24/95   Page 39

     Q:   One area where progress must be made is on these old

     debts whether they are short-term or long-term including our

     own Bank debt.

     A:   Yeah.    And we are getting rid of the Bank debt. We've

     got the fifth dimension, that's part of SPA. These dimensions

     you may hear about; first, second, and third. First is debt

     relief, second is the SPA, or maybe the first is SPA and the

     second is debt relief.     But under the fifth dimension the

     reflows to IDA are used to buy down World Bank debt in

     countries where we, the Bank, as distinct from IDA won't be

     lending anymore, and has not been for some time. Before these

     countries went into freefall they were creditworthy, so they

     did have some debt, and this was relatively long-term, 20-

     year debt or more, sometimes 25.     So there are a few payments

     left in some of these countries.

     Q:   Tanzania had some, Zambia had Bank debt.

     A:   Right.     These countries are now repaying these loans

     with interest with the new money.    We are adding special

     allocations of IDA reflew money to these countries to get rid

     of that debt.     Now, we are also buying down the private debt
                          WORLD BANK - JAYCOX 5/24/95      Page 40

at a deep discount.    I've got seven countries in Africa, in

this program, this is the sixth dimension.     The sixth

dimension is a debt reduction operation which deals with

private but publicly-guaranteed debt.     We try to clear it.

It's like going after an elephant herd. The deal there is we

make an offer and try to make. a deal. On the average we have

paid about nine cents on the dollar.    We buy it all.     We

usually put in $10 million and then other donors put in as

much as they like.    The Swedes are very good at this.     The

Swiss and others have come to the party with similar amounts

of money.   And we've bought all the private debt outstanding

in a country.   Niger, Mozambique, Tanzania, I think we'll be

moving on to. Of course there is no transfer of money to

these coutries because they are not paying this debt.       The

cash flow consequences are zero.    If they were paying the

debt we couldn't buy it for nine cents.

     So we are just clearing it out.    The feedback we get

from the debtors, is however very positive. They say:"Okay,

we are indebted and we can't pay. But the debt is building in

terms of its principal because we don't pay the interest.
                         WORLD BANK - JAYCOX 5/24/95    Page 41

That gets capitalized.   And it's growing fast, because it's

capitalized at eight percent. It's growing much faster than

our economy, so, there's no way we are ever going to be able

to repay it. So let's get it out of there."   The private

entrepreneur who may want to invest in this country, all he

sees is this,   unpaid debt and the fact that these other

creditors were there first and are going to have a prior

claim on any revenues.   Of course, the reformer sees that and

he says, "Oh, my God, you know, if I reform and I get a

little success these guys are going to suddenly wake up to

the fact that they've got debt in this country and they are

going to swoop in here and take the benefit of all the effort

that I'm making, even though it was my predecessor twice

removed that incurred this debt.   There's no point in trying

very hard to reform this economy under these conditions."

That's why we've got to get the debt out of there.     So that's

what we are doing.

Q:   I want to ask about the Wapenhans Report and what input

you had into that report
                        WORLD BANK - JAYCOX 5/24/95      Page 42

A:   Well, we had tremendous input because before the

Wapenhans Report was even commissioned, we had had a number

of very bad news kind of reports coming out of OED and out of

our own portfolio review, our annual review. These were

showing us that the portfolio in Africa was not succeeding

and in fact I think our agriculture sector in Africa was the

worst portfolio in the Bank.    It was something like only 52

percent of the projects being a success.    This was probably

stretching it.   The reasons for some of this had to do with

the poor economic context because when domestic prices went

into hyperinflation and export commodity prices declined, the

combination of that and the slow movement of the exchange

rate meant that these countries were cutting their links with

the world market. It also meant that a lot of our projects,

even those that depended on road traffic, were not

performing, not generating enough benefits or revenue.    So,

we were very unhappy with this.    Also, we were finding that

disbursements were lagging.    We had at one point $13 billion

tied up in accounts.   In Nigeria we had over $2.5 billion, I

think almost $3 billion. This also reflected a lack of
                               WORLD BANK - JAYCOX 5/24/95   Page 43

institutional capacity.         Sometimes corruption interfered.

They couldn't award contracts because they couldn't figure

out how to get their own money out of it.         Our transparency

and accountability rules stifled them so they didn't award

these contracts.      And in some countries it was as bad as

that.     So we launched a number of efforts to deal with this

problem.

Q:      You started this about when?      Can you fix in on the

time?

A:      Yeah.   I think '91,    '92. And that was when the Wapenhans

effort started.      We had a team already focused on the problem

and they participated in the Wapenhans Report Task Force.

They looked at best practices, like mid-term review on

projects, special in-country portfolio review sessions etc.

In fact this was already common practice in the Africa

region.     The issue of ownership and participation, we'd just

started that. But now we have one department that's 100

percent and we intend to be 100 percent by the end of '96.

Q:      One hundred percent of what?
                          WORLD BANK - JAYCOX 5/24/95    Page 44

A:   Beneficiary participation in the projects. Quality at

entry was as much of importance as portfolio management, of

course.   I think we've made a big contribution toward the

Wapenhans Report.   We had no difficulty with the finding.

There's only one minor issue which I think is important,

where I don't agree with the Wapenhans Report and we are not

going to implement it.    We can't afford to implement that,

and to me it sends the wrong signals, and that has to do with

co-financing.   Co-financing is absolutely essential in the

Africa region. But the problem for our borrowers is not so

much our portfolio as much as their portfolio.     I mean the

country's portfolio.     In Uganda we have 2,300 projects, all

of them financed by donors. But Uganda doesn't have enough

shillings under these programs to finance their part.        The

donors are all hounding and competing for those limited

shillings and for unlimited Ugandan managers. I'm just using

Uganda;   you can put any country there.

     Their portfolio is a complete chaos.     A tremendous

overhang of unfinished and unfinishable projects, with no

management and no prospect of success.
                          WORLD BANK - JAYCOX 5/24/95    Page 45

Q:   What do you do with an unfinishable project?

A:   Well, if it's supported by a donor who is dead-set on

hanging in there competing for their shillings, nothing.       It

just hangs there and eventually I don't know what happens.

The point is that we broke the camel's back a long time ago

by putting one straw on top of another and nobody paying

attention to the total weight, the macro implications of what

they were doing.   Macro in the sense of management or

institutional capacity.

     So my view is that co-financing is the highest form of

coordination.   What we do is by co-financing we reduce the

number of projects. We enhance the focus of donor money, and

we get the projects appraised in the appropriate context

appropriate, i.e., the macro framework.

Q:   Right.

A:   We don't do anything that we don't think we can finish.

 I'm all for co-financing because I think it upgrades the

portfolio of the borrower and it upgrades the quality of the

donors' assistance.   This may sound arrogant, but if we

didn't do it we would hope somebody else did it.    Somebody
                           WORLD BANK - JAYCOX 5/24/95       Page 46

has to provide this vehicle for getting a higher quality

assistance.     And since everything is donor driven now,

there's virtually no investment taking place in these

countries that is not the brainchild of some donor.         Donor-

driven is what we call it.      So the idea is to get this donor-

driven program more focused and to be of higher quality.

Q:   Do you agree with Wapenhans' analysis of the reasons

that led to this problem?     Do you agree that there is a

culture with emphasis on quantity rather than quality?

A:   Yeah.     I do.   I think that's part of it.   That's a real

syndrome.     That goes into personnel, skill mix, issues,

everything.     And it comes back to the definition of the

project as of the product of this Bank.      Is our product this

report?     This appraisal report?   Or is our product what the

results are on the ground out there in Africa?       It's

obviously the latter.     That's the way we ultimately will be

judged.     But the reports are the focus of our staff

incentives.     They are the focus of what drives the budgets of

the Bank.     Talking about budgets, I've done a rough back-of-

the-envelope calculation. Taking my entire budget and my
                         WORLD BANK - JAYCOX 5/24/95        Page 47

entire portfolio and dividing it by the number of projects

that we approve and supervise, and we have about $1 million

per project in the administrative budget.    We've spent 75

percent of that by the time we get to the Board.     And we've

got eight years of implementation to go.     The idea that a

project is going to look like what we have described in that

report eight years from now is preposterous.     Not in Africa.

 If it did it would be another project.     That project has to

be redesigned probably twice if it's going to be successful

in eight years.    I'm not talking about a simple road project.

But the attempts at institution building and capacity

building are all built into the project.     It has to be

redesigned at least twice.    But don't have the resources;

we've spent all the resources getting the damn thing

approved.    This is obviously wrong.

Q:   Is that changing now?

A:   Yeah.    That's changing now, but it takes time. I'll tell

you, it is very hard to get more flexible sounding appraisal

reports, shorter things with less polish, less detail and

getting the people on board that are willing and able to
                         WORLD BANK - JAYCOX 5/24/95   Page 48

spend most of their time in the field as opposed to here,

people who don't worry about whether they are glib enough to

present something to the Board but whether they know enough

to actually design these projects and help these people get

results on the ground.

      We are rewarding generalists here very strongly because

of the way we are organized, the way our product is defined

incorrectly. The generalist is the overall guy. He may not

know anything about getting results on the ground, but he can

get a decision, he can talk people into things, and he may be

pretty good with the government too, by the way, in policy

reform and all that. But the thing is we are rewarding him

not for the policy reform but for the reports he writes, and

as a result his energies are concentrated in the wrong place.

 When we get a finished product in terms of recommendations

to a government on policy the thing should be a dirty white

cover. That's when it should be discussed with the

government, when it's still in draft.   If the government

needs further work in order to be convinced, we ought to do

it.   If they don't get convinced, we ought to stop there.
                         WORLD BANK - JAYCOX 5/24/95      Page 49

The time we spend going to gray and green cover of a report

that finally ends up on some shelf in Iowa University is a

waste. Yet, that's about half of the cost, and that half is

providing no value-added whatsoever as far as results on the

ground in Africa.

Q:   But you still have the process of going to the Board and

country strategy discussions and PFP?

A:   Yeah, but I think we could systematically starve this

beast.   Just put it on a steady diet and after 10 years this

will require less caloric intake than it does today.      You

will be satisfied with less food for thought.

Q:   Is that something that you are doing because you are

recognizing this has to be done?     Or is that something that

you view as a signal from the top of the organization?

A:   This is the Mickey Mouse end of this. It's the change

agenda for the Africa region.

Q:   Yeah.   I've got one of those. I studied that very

carefully, I must tell you.

A:   Did I give you that before?     We are serious.   We started

with Benor's operations in Africa.     We are trying to make a
                         WORLD BANK - JAYCOX 5/24/95   Page 50

report, a five-page report, the total reporting requirement.

 This is a cookie-cutter thing.   It's really a system and all

you have to do is change the name of the country and the

numbers.   There's no reason to write any poetry about this.

We do not have to describe our inventory of the whole goddamn

agricultural sector to make these cookie-cutter loans which

are obviously right on the mark, so why bother?   Who are we

doing this for?   The Africans don't need this, and we don't

either.

Q:   You do it for the top.

A:   They don't need it either.   They could just read them,

but what we intend to do is persuade them that they don't

need the reports, that they can rely on the product. But we

are having a little trouble with that.   There has been a lot

of criticism of the extension process lately, but I haven't

figured out the source of that.

Q:   You called it a real syndrome. Now, looking back from

1995, to what extent was that syndrome produced by McNamara's

changes in the Bank?
                           WORLD BANK - JAYCOX 5/24/95    Page 51

A:   I think that what McNamara did was the beginning of

this, it's the way the thing was managed more than the focus

on project approval as such.     The idea that we should be

sitting here waiting for everybody to come and that resource

transfer is not part of our job is ridiculous.     We have an

obligation to move these resources in a timely fashion.        They

are entrusted to us and we should move them.     These countries

need them and they are urgently required.     There is no reason

for us to be going limp.     We have to be aggressively trying

to make development happen.     That means money, numbers of

projects, pressure.    It's appropriate I think to have

pressure.    Now, on the other hand, where is the pressure for

quality?    Where is the pressure for ownership? We are just

getting this thing back into some proper framework.       It was

rather open-ended and going the wrong way in my opinion.

That's the way I look at it.

     I've had this argument 50 times since McNamara left.

But if you think about what the Bank was like before

McNamara, then I don't think those were the "good old days,"

as far as I'm concerned.
                         WORLD BANK - JAYCOX 5/24/95     Page 52

Q:   Right. No, I'm not saying that, but as historians, we

are always looking for something that breaks at a certain

point in time.

A:   I think that we've had that break. I think it was

Preston's influence.   From my perspective right now, it was

Lew Preston.

Q:   Well, now going back to the Wapenhans Report, when I

read that the numbers on agriculture were disappointing, it

didn't surprise me. Because if you look over the whole world,

everybody's efforts to change agriculture have failed. If

communism failed in any one place it was in agriculture.

     It seems they spent decade after decade re-educating the

agriculturalists. The United States Department of Agriculture

invested literally billions of dollars for decades in the

agricultural system and got very little productivity change

until the Second World War came along. Then all of a sudden

all of that surplus was used, so it was a wonderful thing

then. So the disappointment in agriculture didn't surprise

me, just from what I know about agriculture and how difficult

it is to change it.
                         WORLD BANK - JAYCOX 5/24/95     Page 53

     The one sector that did surprise me was water supply and

sanitation. Apparently those projects got into an enormous

amount of trouble, and those statistics on, on what the

Wapenhans Report called "major problems" were as high for

those projects as they were for agriculture. I couldn't

understand that.   Was that noticeable in Africa?

A:   Well, the Africa situation I don't think that water

supply was a particularly weak sector.    But, maybe it was.      I

was mesmerized by the agriculture sector because I regard

agriculture as so crucial in Africa that I wasn't going to

live with that another minute.   By the way, that's changed.

We now have the second strongest portfolio in agriculture in

the Bank. That's partly due to getting out some of these dogs

but a lot of it has to do with really turning these projects
                                                                      ....
around one by one at a tremendous cost.

Q:   How do you turn projects around?

A:   We went in and restructured every one of them.      And we

turned the area-specific and the crop-specific investments

into more general services, a systemic approach.    We
                         WORLD BANK - JAYCOX 5/24/95     Page 54

cancelled a lot of projects and immediately redesigned them

back in place.   We consolidated the extension services.

Q:   When you consolidated the extension services, what did

you do?

A:   Take Kenya, for example, the darling of the donor

community until recently.   They had 11 separate extension

services, each of them donor-driven, in Kenya.     If I'm not

mistaken, we also had three in there.   Because we had area-

specific kind of operations.   For instance, that Bora Bora

Project, it had it's own extension service.     It was not part

of the National extension service.   It's a big irrigation

scheme and we had an extension service there.     It had its own

little research station, it had its own vehicles and offices

and officers and all the overheads. It turned out there was

no output.   So that was not a successful project. Apart from

ourselves, the donors all had their crop-specific, area-

specific, sometimes gender-specific extension services. None

of these had anything to do with each other.     They were not

linked to sources of knowledge, domestically anyway.     They

had no links to a research center, so there was no system
                            WORLD BANK - JAYCOX 5/24/95   Page 55

there.     It was not adapted to Kenya.   This is where we had

to, instead of just fixing our own portfolio, fix the

portfolio of Kenya, and then knock everybody's heads

together. We had to bring this all into one extension

service, the National Extension Service.      If anybody was not

aligned with that, we got the Kenyans to assert themselves

and say, "By God, we have an Extension Service.      There is no

other Extension Service.      You guys are either in this or you

are out altogether."      Finally the donors found their way into

the system.     They still have their little areas, but they are

conforming to this system at last. Similarly, in research we

had a half a dozen systems, and also different credit

systems.     We had the Japanese passing money on directly from

the taxpayers in Japan to credit systems where the farmer got

free credit.     Wow!   You know, that meant the farmer threw big

weddings for his kids.

Q:   He withdrew that money for his kids?

A:   Yeah.     There were some donors insisting on market rates

and then others had subsidized rates. There were all these

different crop-specific, area-specific, gender-specific,
                         WORLD BANK - JAYCOX 5/24/95      Page 56

farmer size-specific credit schemes, all over the country.

No consolidation.   This had a big impact on the financial

system as basically these schemes didn't work, and were a

drain on the public budget.    We consolidated that.    We fixed

these things.   And it was very painful.    It took us three or

four years of solid work.     It was more important than any of

the new lending, as far as I'm concerned.     So, we did change

the culture, and I hope we can keep it that way.

     Of course, this year we are supposed to do 80 projects.

We are only going to do 63.     One of these days somebody is

going to say, "Hey, now, wait a minute, you know.      Where the

hell are these 80 projects you are supposed to be approving?"

 So I expect the pendulum to come back.     But right now the

pressure is off on lending, and Lew Preston and Ernie and I

think the Vice Presidents tried to transmit that down.

     At the Department and the Division level they still see

the budget driven by the number of approvals. So there is a

constant tension between the upper management saying, "Look,

what we want is results on the ground, and you are going to

get the budget that you need. Just be accurate in your
                           WORLD BANK - JAYCOX 5/24/95   Page 57

projections."     Of course they say, "Well, if we only have

eight projects in this Department that means we are going to

have to cut X number of staff.     We don't want to do that

because next year we want to be able to do the 12 projects we

have scheduled, probably optimistically, nevertheless, so we

don't want to cut.    So this year we'll put 12 too, and of

course we misinform the bean counters." Then the bean

counters have their own revenge at the end of the year and

say, "Well, goddamn it, you didn't deliver 12, you only

delivered eight, and we are going to cut your budget by X."

So these things are not going to go away.     I think they are

management issues internal to the Bank that will always be

there.     They are natural contradictions that have to be

managed.

Q:   I must be one of the few people in the world that you'll

meet outside the Bank who is fascinated by extension

services.

A:   No.     You know, in fact, it's such a passionate business

that we have practically riots over extension services. The

French are giving me a terrible time over these extension
                          WORLD BANK - JAYCOX 5/24/95   Page 58

services.   You know, I sent a mission to France to see their

Extension Service and it turns out it's exactly like the one

we are advocating. But it's not the one that they are

advocating in Africa.   And the difference is a very colonial

attitude.

Q:   It's also a great French attitude.

A:   They do not act vis-a-vis their Brittany farmers the way

they would have us act vis-a-vis the African and the way they

act vis-a-vis the African.    They don't trust these Africans.

 That's basically it. But anyway, the (Bretons) don't trust

Paris. So things even out.

Q:   You were describing how it took you about three or four

years to consolidate all of these extension services, and I

was trying to imagine the politics of that. I was imagining,

the reaction of the donor countries. You just described a big

problem.    Every American has a problem with the French.   We

always have.   And the French have problems with us. They beat

up on Eisenhower all the time.

     You've got these, you've got not only the donor

countries, and France being an example, but you've got the
                           WORLD BANK - JAYCOX 5/24/95      Page 59

local political system as well. All these people who are

involved in the extension service, many of whom are

passionate and have a lot of pride in what they do.      I'm

trying to imagine how you brought about the consolidation.

I'm trying to imagine the politics of that.

A:   The first thing is that the last assumption is wrong.

The agricultural extension workers in Africa are demoralized.

They don't have any budget, they don't have any results.

They are not esteemed by the farmers, and they hide all day

in the market place rather than going out and expose their

ignorance to old farmers who know how to grow corn. These

guys don't know how to grow corn.     They don't know anything,

and they've not been given any training.     They are not

informed.   They do not have a message to give to these

farmers.    So they skulk around and they are not exactly

ashamed to take their pay, but they are not getting paid and

they are not getting any perks or anything to go with it. The

whole system is defunct.

     Now, in some of these little pockets, they have trained

extension workers, but these extension workers, in some cases
                           WORLD BANK - JAYCOX 5/24/95     Page 60

are white. This is a sinecure.     There are all kinds of guys

in "lederhosen" walking around out there telling people how

to grow corn.     These African farmers are polite but these

guys are overqualified, overpaid, and they are not getting

results either.     They can't see enough farmers to ever bulk

anything up into anything but the most luxurious showcase

operations.     And these operations are irrelevant.

        We appeal to the government.   First of all, we say, "You

need an extension service that's going to serve your needs.

You've probably got twice as many people as you need.        So one

of the first things to do is cut the service down to a chosen

few. Then you adopt this system in which you train them every

two weeks and they go visit the farmers every two weeks, so

they have their own clientele and they have something to

say."     And then we back them up with a research system. This

is all really part of the deal. The research is the back end

of it. And that's the failing end at the moment.       But the

middle part is what we call the "subject matter specialists,"

and they deal with livestock, field crops, perennial crops,

tree crops or whatever.     But they don't have a separate
'•




                              WORLD BANK - JAYCOX 5/24/95        Page 61

     extension system for each of these things.      The farmer sees

     the same guy, whether he's growing maize or cocoa, but this

     fellow is trained by these subject men who serve as a

     constant reference.   Not only that.     Everybody knows where

     this Extension worker is every moment of his working day.

     He's got an appointment, he's under a tree, he's in the

     schoolyard or in a public square in these villages, and he's

     got to be there at ten o'clock. He's got a bicycle or a

     motorcycle and he's going to be there.     And the supervisor

     can find him there, and does.   I mean, these guys are

     supervised. So this system seems to work, and there's not a

     white face in the entire service, not one.     We are now

     working in 22 countries and there is not one expatriate.

     World Bank staff is organized in the field,     they visit these

     projects, they do a lot of supervision:      It's very expensive

     for us.

     Q:   How did you get all the white faces out of there?

     A:   Well, that's a real problem.      Africa is completely

     peopled with what you call "middle level" functionaries and

     professionals who really are out of touch with reality
                             WORLD BANK - JAYCOX 5/24/95     Page 62

anywhere else in the world.       They are no longer considered

employable.     They are doing just fine and loving Africa.      But

they are overpaid and they don't have much impact.         They are

hanging on tenaciously.      They are not going to be put out of

business.     And they are bad-mouthing any attempt at reform.

        The French believe that this extension system is such a

powerful organizational technique. You have 4,000 or 5,000

people, you know where they are every day and they are

talking to 60 other people every day. So you get this

incredible machine, you could put anything in it, propaganda,

political organization. The French are worried about the

power this entails, that governments are going to have this

highly effective tool. It's like giving them an AK-47. They

can do anything with it.      But I'm not going to worry about

that.     We are delivering agricultural technology and that is

essential.     But now we are also thinking about using the

system to maintain roads, we are thinking about using it in

the school systems, we are thinking about using it in family

planning.     And why not?   Why can't we use, not the same

people, but the same technique for this?
                          WORLD BANK - JAYCOX 5/24/95    Page 63

     It has the great advantage that it is not very capital-

intensive. The loans that the World Bank makes for it are

small, so it looks like we are transferring less money. There

are a lot of recurrent expenditures which we are regarding as

capital in the sense that we are creating capital. Technology

in the hands of farmers is capital in the production process.

 So we are getting rid of the religiosity of capital versus

recurrent expenditures.

     We are willing to finance recurrent expenditures.        We

think other donors should as well.     In a few other areas,

like schools and research centers, we deal with the issue the

same way.   But the point is that our internal costs have

risen amazingly. Instead of this one million dollars per

project, it's probably going up to a million and a half

total. But we are spending only about a third of it by the

time we get to approval, and we are spending two-thirds in

the field in the course of usually four years.     This means

the administrative budget is going up, and the capital

transfer is going down in the sector. So it's looking like a

very cost-ineffective operation.     So there's resistance.
                          WORLD BANK - JAYCOX 5/24/95   Page 64

Q:   It's politically vulnerable.

A:   Yeah.   But it's the wrong impression.   The impression is

wrong because we are dealing with a highly catalytic

approach. 95 percent of the effort is on the farm with the

farmer, his land, his labor, his inputs.

     The other element here is the environment.   Without this

technology the environment is on the way to the garage. Be-

cause these farmers are growing in numbers at this phenomenal

rate and they are using a land-extensive technology, and

shifting agriculture cultivation.

Q:   Just like we did when we probably settled America.

A:   Exactly. They've gone into the forest, they are going

into the pasture lands with crops, they are changing the

ecology, they are going to ruin it.   The cost of this 25

years from now will be irredeemable if we don't turn it

around in the meantime.

Q:   Still on the same subject, when did you begin to feel

that the new extension techniques were taking hold? How long

did that take?
                          WORLD BANK - JAYCOX 5/24/95      Page 65

A:   Well, Danny Benor was doing this in Asia long before he

came to Africa.    Africa was, is only his latest and greatest

success.

Q:   Most difficult.

A:   Well, he says it's not.    You know, he was amazed.     The

quality of farming in Africa is actually potentially very

high. He's always saying, "Look, you show me an African

farmer and I'll show you some of the best, most clever people

in the world."    These people may be conservative, too

conservative. The way we've tackled that is by saying, "Look,

just devote 10 square meters to our crop, to our technique.

You know, take a risk.    If you don't like it, forget it.      But

if you like it, then, you extend it.    Right?"   That's the

agreement.    And, you know it makes such a phenomenal

difference.    Planting in rows, proper spacing, so there's

less weeding and more product. Applying the fertilizer in two

applications rather than one and doing it in the right

amounts at the right time.     It makes all the difference in

the world.    And it costs less, in the end.   The thing is just

going like wild fire with a demonstrated doubling and
                         WORLD BANK - JAYCOX 5/24/95     Page 66

tripling of yields. Even in Burkina Faso, which is a very

austere place. Most of the technique was transferred from

Maharashtra and Thailand and Indonesia, by Danny Benor who is

from the extension service of Israel. He is the guy who

devised this system in Israel and is now taking it to Africa.

 As I said, we are in 22 or 23 countries, and we've gone to

scale in five or six now with the whole country covered.

Virtually, every farmer in the country is being seen by.

extension workers on a bi-weekly basis with a specific

message.   They don't go out at the beginning of the year and

say, "Look, this is how you grow corn, maize."   They go out

and they say, "I see you've got maize in your field.     Now

let's see if maybe we could, take 10 meters here and plant

them closer together" and use some devices, give them a

little stick, a little measuring device to work with.

     This is how far apart to plant.   This is how far apart

to put the rows. Or a little

     [END OF TAPE 1, SIDE 2]
                           WORLD BANK - JAYCOX 5/24/95     Page 67

--dixie cup, which contains the exact amount of seed for one

row of maize, or fertilizer.     And then the guy gets this

phenomenal result.

     Danny is really a genius.     He is a messianic type, and

he wears this little horned beanie on his head so you can see

him for miles.   In Africa you can see this guy literally a

mile away walking through the fields.    He spends a couple of

hundred days a year in African farmers fields.     He is known

all over Africa as Danny Benor."    He'll sit with these

farmers, like in Burkina I was with him, we went and looked

at this erosive edge of the desert moving 200 meters a year

in our direction.    And it had been doing that for years.

Trees half-buried, just within sight.    And he said, "Well,

what are we going to do about this?"    He may look at a farm,

a farmer's field and say, "You must have had too much water

here."   And the farmer says, "No, I have no water."     Benor

would say, "Well, it looks like you wanted to grow very fast.

 You know, you put the rows up and down the little hills

here."   And Danny just says, "Well, why don't you go across

instead of up and down?"    And they would talk about this for
                             WORLD BANK - JAYCOX 5/24/95   Page 68

a day and a half.     And eventually it becomes this guy's idea

to change the way he does business.       There are the extension

workers, and they get these little rocks and they put them in

line, just to slow the water down, about every 15 meters they

put in a little line of rocks, run them across the contours.

     There is only about three weeks of rain in the entire

year. What happens is that the water slows down, sinks in,

the wells fill up. They use mulch on their fields, the next

thing the whole country is transformed and they've stopped

the desert in Burkina Faso, right across the whole place.

Hundreds of thousands of farmers have now adopted this

technique.     And if you go there you'll see a mark, right

across, you can see it from the air, right across the

country, about 700 miles.      The desert has been definitely

stopped.     And that has all been done in four years.

Q:   That's in the most recent four years?

A:   Yeah.     Since 1990.   And I'm very bullish. Agriculture is

growing at seven percent in West African Sahel. That's partly

because of this onchocerciasis.      We've got rid of this river

blindness which allowed people moving in there and culti-
                           WORLD BANK - JAYCOX 5/24/95    Page 69

vating the land. Now we've got a potential ecological

disaster and the extension service has got to be there right

away in order to make sure that they don't use the old

extensive technology.     They've got to stay on their plot.

They've got to maintain the fertility of that plot.      And they

can all do that if they farm it with some technology.

Q:   When would you date the breakthrough on river blindness?

 That's been fairly recent?

A:   Yeah.     They declared that the back was broken I think

about 18 months ago.     And before that of course they knew

they were on a winning wicket.

Q:   The big thing is Neptazane, isn't it? Developed by

Merck.

A:   Merck was donating it to ITP.

Q:   There's a funny story about that. When the CEO of Merck

started to read this literature that implied that WHO

developed the drug, he insisted that they had to say who

developed this. One of those funny anecdotes.

A:   In our literature Merck is given credit for that

development.      And that was a big deal.   But more important
                           WORLD BANK - JAYCOX 5/24/95     Page 70

than the drug which creates immunity or a cure was to deal

with the flies. That was the costly part of it, of course I

guess if Merck had charged us for this drug it would have

been very expensive, but the way it was the expensive part of

the program, getting rid of the flies that transmit the

disease.     The first stage was getting rid of the fly.

        Now, you've been going around giving speeches, telling

people about how much progress has been made, that there is

in fact progress in Africa and that it is not a lost cause.

At the same time you have the feeling that those people who

are saying, Africa is a basket case, are on the up and

coming, and seem to be even using this to blame the Bank.

They say the world Bank has failed.     Here is the example.

This is how it has failed.     Africa isn't moving.   How do you

explain this?     Why are people saying this?   How do we reach

the point where even IDA is to some extent threatened by

this?

A:      Well, I don't agree with the last point.   I think the

only thing going for IDA is Africa.     Without Africa IDA is
                         WORLD BANK - JAYCOX 5/24/95    Page 71

dead. Very few countries could carry the IDA story the way

Africa must and will, whatever the ideas.

     But I think your point is right.   First of all I think

that what has happened in Africa, while it has its positive

turn to it and it's undeniable, the fact of the matter is

that nobody is satisfied.   I certainly am not satisfied.     I

don't think anybody in the region or in the Bank is satisfied

with how long it's taken, how many slippages there have been,

how much money it's required up to now, and how much money it

will require if we can't speed up the effects.    The slow

response of the private sector, which I think we understand,

that's also part of the syndrome, and without the private

sector we are not going to get an acceleration of the

results.   So private response has got to come.   Since aid is

not very buoyant, since debt is very important, since the

economies are not diversified enough to withstand the kind of

shocks they are undoubtedly going to meet, we need a

diversified private sector, a more diversified economy.      If

we don't get it we are going to remain at this very fragile

and unsatisfactory level of performance.
                           WORLD BANK - JAYCOX 5/24/95    Page 72

     But I think if I were talking to people who would in

fact make the argument that way, we would have no big

disagreement.    And there would also not be much criticism of

the Bank because it would be seen as a very tough job, one

that's going to require a long-term perspective, a lot of

effort, some luck, and a lot of other things.

     But, unfortunately, what we do have is people who come

for a very quick take and they look at the averages on

Africa. This includes Zaire, Sudan, Somalia, Rwanda, Burundi,

Liberia, Sierra Leone, Angola, Nigeria, countries that have

not been going in the right   direc~ion   or are still in a

freefall or in chaos.   The negative rates of growth of these

countries are offsetting, in the averages, the positive

growths in the other countries which are more numerous but

smaller. And, of course, these negative rates are much higher

than the positive rates.

     In the whole Franc zone before the devaluation we were

getting a negative growth of four percent per annum growth.

That had a hell of an impact on Africa.     Now all that's

turned around.   It's back to one or two percent positive.
                           WORLD BANK - JAYCOX 5/24/95     Page 73

This year it will be around five or six percent on average I

think in the Franc zone.     Certainly in Cote d'Ivoire it will

be around six percent.     Senegal, probably.    So, you see,

these averages distort the picture.

      If you look at Africa as one place you get this result.

 Unfortunately, most of the world does not look at Africa in

its diversity, it doesn't break it down, it doesn't unbundle

it.   It doesn't look at what's happening in Senegal, Benin,

or Togo, or Ouagadougou; Burkina Faso, or in South Africa or

in Malawi.   If you looked at Asia like that in the late

Seventies you'd see the same phenomenon.

      If you took the averages of, say, in '78, China, Burma

Laos, and Vietnam and threw them in together with the Phili-

ppines, Indonesia, Thailand, Malaysia, Korea, you would have

a stagnant performance. In fact you would have probably a

negative growth rate for the whole place.       We would not see

the "Tigers," this phenomenon that has happened since then,

although it was beginning to happen then.       We wouldn't be

able to see them if we didn't have a more discriminating view

of that part of the world than we do of Africa.       But we
                           WORLD BANK - JAYCOX 5/24/95      Page 74

didn't lump those countries together, we didn't look at East

Asia the way we look at Africa as simply one place.

     So I think that's part of the issue, and it's got to be

overcome.    That's why we've written another Long-Term

Perspective for Africa.     It's called "The Continent in

Transition."     It disaggregates Africa and talks about the

fact that quite a lot of the spectrum has opened up. Some of

the countries that tightened up during the negative trends of

the world economy, now are beginning to move with the little

sea breeze that's coming from the world economy. But the ones

that are in chaos are still anchored there. They are still

flapping in the wind.

     You are a sailor.     You got the analogy.

Q:   Yeah.     The addition of South Africa to the whole game

plan has presumably increased the prospect for changes. This

may give Africa a lift.

A:   Certainly Southern Africa.       It's already happened in

some respects.     But South Africa is not a strong economy.

It's a very sick economy.       It's not competitive.   It's not

modern.     It can't compete.    It has been cut off from the rest
                          WORLD BANK - JAYCOX 5/24/95       Page 75

of the world, and it's had a negative growth rate for 10

years.     It still got various political problems. But I think

the political energy unleashed by the success of southern

South Africa is going to have effects on its neighbors.        In

DEC they now talk about neighborhood effects.     This is

definitely a positive neighborhood effect. It could become

very positive when the South African economy really starts to

move again. The negative effects, though, of the neighborhood

effects of Nigeria are equally strong, if anything

outweighing the positive effects of South Africa in Africa as

a whole.    The negative effects of Nigeria probably more than

offset the positive effects of the CFA devaluation in that

part of the world. So we have a very serious economic

objective in West Africa, to get Nigeria back on a positive

growth path, and with their political problems that's going

to take a lot of doing.    That's not going to be easy.

Q:   That's another governance issue.

A:   Exactly.
                         WORLD BANK - JAYCOX 5/24/95     Page 76

Q:   When did the Ogeneral critique of the Bank come up on

your scope?   When did you notice tha there were a lot of

people that don't like us?

A:   Well, we became much too important in Africa.     We are

like the judge in the bankruptcy court.     You know, they can't

even pay their debts without our permission.     I think I've

said this before.

Q:   Yeah.

A:   And the other donors are sort of in the back seat of us

because we are leading this economic reform.     The African

countries can't come up with the shillings to finish the

projects that are financed by the Danes or the Swedes because

the IMF and the World Bank have said "You cannot inflate, you

can't create any more money. The NGOs think that change is

painful for the poor, even though without change, the poor

would be the first to get it in the neck.     So I think that

we've earned all this because we have become too important.

I don't think we've made a lot of mistakes.    Of course, we've

made mistakes. I'm willing to admit that.
I.




                              WORLD BANK - JAYCOX 5/24/95    Page 77

     Q:   Sure.   Could the Bank have done anything to prevent

     that, in your view?

     A:   Belatedly we are doing some of the things we should have

     done earlier. One is to reach out to the NGOs. I believe the

     NGOs and the World Bank are natural allies.    They should be,

     because we have similar objectives.   In the case of Africa,

     though, the African governments were negative about NGOs by

     and large.   NGOs were considered to be not just non-govern-

     mental but anti-governmental, and as a result we couldn't

     really operate with them because these governments own us for

     better or for worse, and you just cannot operate with loan

     money in a country without the permission of the borrower.

          So the idea of cooperating with NGOs, both domestic and

     foreign or international, in Africa really is only becoming a

     possibility now, because the governments are recognizing a

     role for the civil society as they accept political

     pluralism.   And it's coming pretty rapidly.   So I think

     there's a whole new world there for us, and we should move in

     that direction.   The trouble is that the NGOs, in their anti-

     government mode, have put the World Bank back there with the
                             WORLD BANK - JAYCOX 5/24/95     Page 78

enemy, the government because we were with the government. We

have to do something about this general situation.         The NGOs

are becoming more welcomed.       But now there's a lot of tension

between the northern NGOs and the domestic NGOs.       We are

going to have to walk that mine field and learn how to do

this.     We are doing it.   We are now doing a hell of a lot

more with NGOs than the Bank used to.

Q:      You are not too late in doing that.

A:      But Africa is really the acid test for more

participation in my opinion.      And I think that what I'm

saying now is not so untrue of the rest of the world.        When

did Latin America become a place where NGOs flourished in

cooperation with government?       It wasn't until quite recently.

Q:      Right.

A:      This may or may not be true in South Asia, but in East

Asia governments are very chary about these northern NGOs.

In Indonesia I don't think they practically exist.         They are

not allowed in there at all.       Then, of course, there are the

single-issue NGOs which we treated in an arrogant fashion,

and they treat us in an arrogant fashion.       Wolfensohn I think
.,




                                WORLD BANK - JAYCOX 5/24/95    Page 79

     has started a good dialogue with them.     Hopefully he will

     follow through.

          The fact that the African public is so ignorant about

     the Bank is also something that can only now be dealt with

     because the newspapers, the press is becoming open.      We can

     now communicate directly with the African public, rather than

     just through BBC and Voice of America and those other

     vehicles.     In the old days you practically lost your job if

     you were quoted in the press, managers and staff alike. It

     was not expected that we would discuss our business with the

     hoi polloi.    In fact, McNamara had the attitude that any

     nickel spent on public relations was a nickel that was taken

     away from the caloric intake of some starving child. That

     attitude still persists and anybody who speaks up is either

     on.some incredible ego trip or is otherwise jeopardizing the

     sanctity of the relationship and all the coziness that goes

     with this government-to-Bank relationship, which is exactly

     what the NGOs and the public are screaming about.
                         WORLD BANK - JAYCOX 5/24/95    Page 80

Q:   Business got over that.   There was once a time when

Vanderbilt said "The public be damned," but they don't say

that anymore.

A:   No.   I don't think we ever said that.   I think we've

thought it.

Q:   Do you want to look back or sum up with something here.

 Do you want to say something about what you personally feel

were the accomplishments that you've logged in your career

and, and any disappointments you may have had.

A:   I have no disappointments about the content of the job.

 With my interest in the job, the kind of passion that I

have, this is juice for me, this is the real stuff.    I wish

that the Bank had been and could be more effective.    I think

that the problems of dealing with some of the issues we are

now dealing with from so far away can be solved. We need to

change the way we are governed by heavy bureaucracy and

internal checks and balances. It's probably necessary to some

extent but it does in fact curb our agility, our

effectiveness and our timeliness, and a lot of other things

that are important to our customers.   So I really think that
•
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                                 WORLD BANK - JAYCOX 5/24/95     Page 81

     those are areas for the future to be addressed. We are

     certainly doing it here in Africa, and I hope to be involved

     in that.

     Q:      Okay.   I really enjoyed this.

     A:      Well, I enjoyed it too.     Thank you very much, you guys--

     Q:      I've learned a lot about the extension service.

     A:      You should be interviewing Danny Benor sometime. I think

     he's one of the great men.        At one point we were thinking

     about having a prize.     We thought in the context of the 50th

     Anniversary. A prize to, even if posthumous, to Bernie Bell

     or to McNamara and Danny Benor, I guess John Crawford already

     got his rewards in many ways.        But, we would, pick some of

     these really outstanding people, people who had made a

     contribution to some of the important issues in the world.

     They used the Bank as the bully pulpit or as a platform or a

     launch pad or whatever you want to call it, to magnify their

     influence.      I think it's one of the greatest uses of the

     Bank, I have not exhausted the number of people involved

     here.     I think that the question would be to really identify

     them.
                        WORLD BANK - JAYCOX 5/24/95      Page 82

Q:   It depends on how much money you have.

A:   We could do it about every five years or so.     I mean,

why not?   If we are going to have a 50th year, we are going

to have a 55th, we are going to have a 60th, we are going to

have a 65th, we are going to have a 75th.

     So, every five years or ·so, pick, two or three people,

go back 20 years or so in order to really see that their

contribution has stood the test of time. It's just a thought.

     [END OF RECORDING, TAPE 2, SIDE 1]