Three European-based NGOs -- Solidar, Eurodad and the Global Network -- released on Monday a report on the compatibility of current IMF loans with decent work objectives. The 32-page report examines three recent loan programmes in El Salvador, Ethiopia and Latvia. It finds that that while the IMF programmes allow slightly higher fiscal deficits on a temporary basis, they give little space to maintain or increase social spending since "the IMF expects the country to bring down the deficits to pre-crisis levels as soon as 2011".
The IMF has stated that it has changed its traditional stances on tight fiscal and monetary policy advice and lending conditions and has become “more flexible”. However, experience so far indicates that the IMF is still imposing inappropriate, pro-cyclical conditions on many borrowers. These may unnecessarily exacerbate economic downturns in a number of countries.
The full report can be downloaded from Eurodad's web site at: http://www.eurodad.org/whatsnew/reports.aspx?id=3850
Comments