Pro-business solutions have made the poor poorer
The IMF is facing a crisis of confidence amongst its debtors and calls for a new approach from its supporters.
The Washingon-based Fund has ruled the global economy for decades, doling out a one-size-fits-all medicine to its client countries. Their prescription of savage budget cuts, usually in the 'soft' social sectors, and wholesale privatisation of services has benefitted the multinational companies which have snapped up the right to provide water, gas or electricity at prices they can name for themselves, but has led to the poor becoming poorer - or, all too often, dead.
Now some of the IMF's largest clients are seeking to pay off their debts and escape the Fund's clutches forever. Brazil, Argentina, Indonesia, Uruguay and Turkey have all either already done so, or have started along that path. It could leave the Fund as no longer a viable institution. Other, poorer countries would like to follow, but cannot yet find the money to be able to escape - no wonder the IMF has been dragging its heels over debt forgiveness!
The top brass of the world economy assembled last month for the annual meetings of the IMF and the World Bank, and a large part of their discussion centred on concerns about the future of the Fund. They came up with a 'new approach', which appears to consist of giving the IMF powers to convene mini-summits todiscuss the future of nations suffering economic problems. That doesn't sound very radical to me, and would doubtless end up as business as usual.
Instead, two leading economists have called for the IMF to be 'taken off life-support'. Walden Bello, Executive Director of Focus on the Global South, and Soren Ambrose, policy analyst at 50 Years Is Enough, contend that the only solution to the continuing crises in Africa and other impoverished parts of the world is a restoration of policy sovereignty to people and governments. Read their aticle here.
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