Tags: iran | world | bank

World Bank Lending Iran $900 Million

By    |   Monday, 05 Nov 2007 10:49 AM

Despite protestations from an influential congressman, the World Bank is going ahead with plans to loan Iran nearly $900 million – with the largest chunk of money coming from the U.S.

Rep. Mark Kirk, an Illinois Republican, earlier this year asked the president of the World Bank, Robert Zoellick – a former member of the Bush administration – to suspend the loans. Zoellick declined, according to the New York Sun.

Kirk, a member of the subcommittee that approves America’s share of the World Bank’s funds, warns that the loans totaling about $870 million will undercut U.S. and Western efforts to pressure Iran into ending the Islamic republic’s nuclear enrichment program.

The main Iranian bank now handling the World Bank transactions is Bank Melli, which was recently designated by the U.S. Treasury Department as financing the nation’s nuclear program.

Loaning money to Iran “sends a message that directly undercuts Western diplomacy with regard to Iran,” Kirk told the Sun.

Kirk said he told Zoellick: “Think of the embarrassment if the U.N. Security Council approves three separate sanctions, and the United States imposes its own unilateral sanctions, and three blocks away the World Bank cuts a check to the Ahmadinejad government.”

A spokesman for the World Bank said the loans were not prohibited by the Security Council sanctions already imposed on Iran, saying: “In relation to Iran, the Security Council resolutions exempt activities by international financial institutions for humanitarian and development purposes.”

Projects to be funded by the loans include improvements to Tehran’s sewage system, relief for victims of the Bam earthquake, and efforts to improve access to health care for rural Iranians.

Zoellick served as President Bush’s first trade representative and was a foreign policy adviser on Bush’s 2000 presidential campaign.

“The loans to Iran present Zoellick, in the first year of a 10-year term, with his first challenge between his loyalties to President Bush and his role overseeing the international institution,” the Sun observes.

Zoellick cannot overrule the bank’s executive board. But Kirk believes that if Zoellick put the loans to a vote, he would probably find a majority in favor of suspending the loans.

The largest donors behind the loans are, in order, the Americans, the Japanese, the Europeans, and the Saudis.

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Despite protestations from an influential congressman, the World Bank is going ahead with plans to loan Iran nearly $900 million – with the largest chunk of money coming from the U.S.Rep. Mark Kirk, an Illinois Republican, earlier this year asked the president of the World...
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Monday, 05 Nov 2007 10:49 AM
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