[News] 87% of IMF Loans Forcing Austerity on Crisis-Ravaged Nations

Anti-Imperialist News news at freedomarchives.org
Thu Apr 21 10:42:14 EDT 2022


commondreams.org
<https://www.commondreams.org/news/2022/04/19/87-imf-loans-forcing-austerity-crisis-ravaged-nations-analysis>
87% of IMF Loans Forcing Austerity on Crisis-Ravaged Nations: Analysis
April 19, 2022
------------------------------

*The conditions of nearly* 90% of the International Monetary Fund's
pandemic-related loans are forcing developing nations suffering some of the
world's worst humanitarian crises to implement austerity measures that fuel
further impoverishment and inequality, an analysis published
<https://www.oxfam.org/en/international-financial-institutions/imf-covid-19-financing-and-fiscal-tracker>
Tuesday by Oxfam International revealed.

"The IMF must suspend austerity conditions on existing loans and increase
access to emergency financing."

Oxfam found that "13 out of the 15 IMF loan programs negotiated during the
second year of the pandemic require new austerity measures such as taxes on
food and fuel or spending cuts that could put vital public services at
risk."

This stands in stark contrast with IMF managing director Kristalina
Georgieva's admonition
<https://www.euronews.com/2021/12/08/don-t-suffocate-recovery-with-austerity-politics-imf-chief-georgieva-warns-europe>
to the European Union last year that the wealthy bloc should not endanger
its economic recovery with "the suffocating force of austerity."

"This epitomizes the IMF's double standard," Oxfam International senior
policy adviser Nabil Abdo said
<https://www.oxfam.org/en/press-releases/imf-must-abandon-demands-austerity-cost-living-crisis-drives-hunger-and-poverty>
in a statement. "It is warning rich countries against austerity while
forcing poorer ones into it."

At the start of the pandemic, the IMF issued billions of dollars in
emergency loans to developing countries with few or no conditions. However,
the institution has reverted to its highly controversial practice of
requiring nations to impose the type of austerity measures that have
exacerbated
<https://www.bu.edu/gdp/2021/04/05/imf-austerity-is-alive-and-impacting-poverty-and-inequality/>
poverty and inequality, stymied
<https://foreignpolicy.com/2022/04/19/ecuador-lasso-oil-climate-imf-world-bank-debt-austerity/>
countries' efforts to meet climate goals, fueled global unrest
<https://www.brettonwoodsproject.org/2019/12/uprising-and-discontent-global-protests-erupt-against-imf-backed-policies/>,
and even played a key role
<https://dlib.bc.edu/islandora/object/bc-ir:102118/datastream/PDF/view> in
sparking revolutions.

The Oxfam report notes that the conditions of a 2021 loan of $2.3 billion
to Kenya compelled the country to freeze public sector pay for three years,
while mandating higher taxes on food and cooking gas.

"More than three million Kenyans are facing acute hunger as the driest
conditions in decades spread a devastating drought across the country,"
Oxfam notes. "Nearly half of all households in Kenya are having to borrow
food or buy it on credit."

Sudan has had to end fuel subsidies, a policy that has disproportionately
affected the nearly 50% of the population that is impoverished.

"The country was already reeling from international aid cuts, economic
turmoil, and rising prices for everyday basics such as food and medicine
before the war in Ukraine started," said Oxfam. "Over 14 million people
need humanitarian assistance (almost one in every three people) and 9.8
million are food insecure in Sudan, which imports 87% of its wheat from
Russia and Ukraine."

Oxfam's analysis also found:

   - Nine nations including Cameroon, Senegal, and Surinam must introduce
   or increase the collection of value-added taxes (VAT), which often apply to
   everyday products like food and clothing, and fall disproportionately on
   people living in poverty; and
   - Ten countries including Kenya and Namibia are likely to freeze or cut
   public sector wages and jobs, which could mean lower quality of education
   and fewer nurses and doctors in countries already short of healthcare
   staff. Namibia had fewer than six doctors per 10,000 people when Covid-19
   struck.

"The pandemic is not over for most of the world," said Abdo. "Rising energy
bills and food prices are hurting poor countries most. They need help
boosting access to basic services and social protection, not harsh
conditions that kick people when they are down."

"The IMF must suspend austerity conditions on existing loans and increase
access to emergency financing," he added. "It should encourage countries to
increase taxes on the wealthiest and corporations to replenish depleted
coffers and shrink widening inequality. That would actually be good advice."

Oxfam's analysis comes as the IMF's annual spring meetings get underway in
Washington, D.C.

Last week, the leftist group Progressive International held an inquiry
<https://progressive.international/movement/article/2022-04-15-inquiry-into-imf-hears-calls-to-take-the-fund-to-the-international-court-of-justice-over-illegality-impunity-and-disregard-for-human-rights/en>into
the IMF at which lawyers, experts, and parliamentarians from nine nations
recommended actions from bringing the institution under the United Nations'
Economic and Social Council to taking it to the International Court of
Justice over its alleged "illegality, impunity, and disregard for human
rights."
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://freedomarchives.org/pipermail/news_freedomarchives.org/attachments/20220421/10583ffc/attachment.html>


More information about the News mailing list