Geneva, 27 Mar 2001 -- The debt relief to poor countries under the Heavily Indebted Poor Country programme should be delinked from the Poverty Reduction Strategy Programme (PRSP) processes of the IMF and the World Bank and debt relief speeded up to eligible indebted countries, an Independent Expert has suggested in a report to the UN Human Rights Commission (HRC).
Highlighting the failure of the HIPC initiative to deliver debt relief so far, and the ‘disconnect’ between the macro-economic policies drawn up by countries to please the IMF and the World Bank, and their poverty reduction strategies, the report (E/CN.4/2001/56) by the Independent Expert, Mr.Fantu Cheru, calls on the creditor countries and institutions to “revisit the whole issue once again”, and among others end the “exclusive role” of the IMF and the World Bank as overseers of the poverty reduction programme, and bring into the process other UN agencies such as UNDP, UNICEF, UNCTAD and ILO.
The SAPs, under the IMF/World Bank guidance began in mid-1980s, and the liberalization of markets they called for resulted in delays in growth. In September 1987, the IMF introduced its Enhanced Structural Adjustment Facility (ESAF), and in November 1999 this was replaced by the Poverty Reduction and Growth Facility (PRGF) which, the expert points out, is merely a financing facility funded by donors to clear up debts owed by HIPC governments to the Fund.
The Independent Expert has called for the abolition of the PRGF, and for a serious dialogue to be undertaken on how to integrate macro-economic policy issues with broader social development goals.
http://www.twnside.org.sg/title/delink.htmThis is basically an attempt to buy the IMF a veto over developing countries' economic policies. Whatever the countries proposed to do, they'd have to get the agreement of the IMF before they could go ahead.