13 April 2007

IMF Hinders African Progress

International Monetary FundAn average of just 30 pence in every pound of foreign aid increases to Sub-Saharan African countries can be spent because the International Monetary Fund requires governments under its supervision to redirect the use of foreign aid increases to either boost international currency reserves or to pay down domestic debt.

This is the shock finding reported by the IMF's Independent Evaluation Office in meetings today and directly undermines Africa's fight against AIDS, illiteracy, and hunger.

Now, the IMF is not an independent body. It is an intergovernmental body. That means the governments responsible for approving an increase in their foreign aid budgets are also the ones responsible for deciding IMF policy. Our charitable leaders are therefore giving with one hand, only to take away with the other ... behind our backs. So much for the exhortation to "Let your giving be in secret" – the Western world's leaders have paraded their giving (and, even more so, their unfulfilled promises of giving) but hidden the fact that they've not been as generous after all.


Janet Long said...

Some of the most under-represented emerging economies, such as China and Turkey, were granted increased involvement at last autumn's IMF-World Bank meetings, but if the Fund is to remain at all relevant, it needs to expand its remit beyond simply managing financial crises to becoming a centre for dialogue among all the world's nations - notably the world's poor and other rapidly-emerging nations, not just the rich ones.