An enving POE: the case ofthe BNDE. 15 4 An enduring pocket of effectiveness ‘The case of the National Development Bank of Brazil (BNDE) Eliza J. Willis ‘The BNDE: creation and expansion as a premier pocket of effetivenes er offers ease study ofthe National Bank for Economic Devlop- (Banco Nacional16 liza J. Wilts ‘Am enduring PoE: the case ofthe BNDE 17 Wile impressive, sizeof impact and longevity lone cannot be considers Bank managers have sought including bond issues ‘corruption. Perhaps the most serious hint of sca ‘legal wire taps onthe phones of various ofc, including the president of ‘itl approach to the making of development policy, Ater two years of78 laa J. Wills An eniving PoE: the case ofthe BNDE. 19 intensive work, the Joint Commision recommended the implementation of Soaneial resources However, Brazilian presidents retained ther power to conserable"autonomows contol over is intemal administration and80 zo J. Wills ‘Becoming a PoE: the function of development financing ‘The lw that created the BNDE endowed the executive branch with sg- nifcant discreon in defining the scope and funding of the Bank's operations inte to vagueness because it permits modern Interpretations to overide An endarng PoE: the cuse ofthe BNDE 81 ints external and internal ‘Becoming a PoE: a (mostly) favourable external environment82 lee J. Wile An onhring POE: the case ofthe BNDE. 83 raking he at pon forging the elope! po nds eats from enteral pola nde ‘recognized the value of insulating some bureaucrats from patronage polities4 Blea. Wits Roberto Campos, Glycon de Paiva Teasra and Ari Totes ~ who had par pated in the Joiat Commision to the Bank’ Grst bosrd of dieeors Roberio Campos, who later became one of Brazil's best known pubic wes, ‘was the principal author of the Joint Commision’ final eport, which explils criticized politcal influence in economic palicymaling and recommended the experts since he had very litle understanding of development banking Second, technically trained individuals prefered careers inthe public sector ‘wher the most imporant development nites were concentrate and where An endstirg POE: the case ofthe BNDE. 85 turned to other state agencies, especially Brazis Ministry of Foreign Affairs jst how competitive thse exa ‘ring exam and 8 of 71 who took the economics exam posed and were hire “The bonds among those in the fist and subsequent cohorts were strenth- During this period the vas organized around si big department, each dedicated 19 one egal. accounting. and ‘optatve ett on those appointed to top managerial posts86 Blea J, Wills ‘The introduction of competitive examinations, the organization of wo ‘An ending POB: the case ofthe BNDE. 81 ‘gover loans 0 both private and public sector borrowers. This achievement ‘as impresie expec te 195, when leader win Bap ‘A second decision rule grew from the Banks specialization asa long-term ender, fvourng loans requiing lage capital oulays, lengthy amortization88 Eka J. Wile ‘An enduring PoE: the case of te BNDE. 89 to ecome the principal source of long-term finance for both the ‘Asa result ofthe introduction of competitive examinations the Banks tit trong over the past five decades Challenges to fectiveness hose t9 make the BNDE a central player in the formulation and imple- mentation of his major develope ‘currency. Because most asic industries were privately owned, the Target Plan90 la J Wille same technical evauation and conditions applied to higher priority projec ‘The Bank Kopped supporting these projects after Vargas sige in 1958 We have evidence the fonction of financing infasrectural projects by 6 percent of total Eaancing had gone to projets recommended by the Joint Commision. The remaining funds and any exception required strong usifeation. No public, reeeed fnancing without prior technical ras often tured propo ‘labora. Thy were ‘determined io educate clients (and polielans!) onthe diferences between = BNDE loan and traditional ‘president, Bank boreaverats were succesful in maintaining thsi technical ‘Standards ‘goods and basic inputs. A Sh infocus toward the private Bank more vulnerable to extemal interventions as spumed firms resorted of Brazlianowned concessions fo companies for oll exploration in ‘Bolivia. Fotiwing principles st forth by an intermiistrial commision set An enduring PoB: the cae of the BNDE 94 ‘dscssions over some lending decisions, although the record shows92 Elza J Wills Bank managers reached consensus onthe vast majority of loans. A review of ‘very loan granted between 1953 and 1961 showed tha. withthe single ‘SANDRA case the dvstorate svar followed te cc depended on various faancing mechanisms (spel axes, pension funds foreign loats and 80 on) c “the fire to provide adequate funding was senously undermining the ‘completion af the National Program for Economic Reequipment (Baer and credited with expanding io increase their contol ‘for a tenyear renewal of the FRE. Apparent, these legislators were com ‘could have helped reduce the eroding effects of inflation that frequently ‘exceeded the amount of interest the Bank ‘Congress never voted on tis propo ‘An enderng PoE: the case of he BNDE. 9% Tesoures plas a sigicant constraint on the scope of the Bank's ctive ‘Triggering effects Gwoed cures i Which the Bank hed jer sake: Ov the decades9 Ela J. Wile An endaring PoE: the case of te BNDE. 9S ‘many téenics with appointments in other state agencies have spent mon tnd even years in temporary posts within the BNDE. While sharing ‘experts, these temporary stall hve also taken what they have lead back Gera which bas maintained a cose working elainship wih the BNDE ‘since 1962, sone prominent sucess cae Azcison to finance controversial projets suchas the Blo Monte Dam inthe ‘made both presidents Is likely to intuence lending dessons in porsut of ‘Amazon, n response to these press. the Bank has moved to incorporate5 Turning Nigeria’s drug sector around nal Agency for Food and Drug tration and Control (NAFDAC) A. Irene Pogoson and Michael Roll!