An alternative to IMF needed

The IMF claims success in helping poor countries to recover from economic crises.

- N. A. de S. Amaratunga

This may be true to some extent in terms of economic parameters like GDP, interest rates, revenue, debt/GDP ratio, etc. But it has, by and large, failed to bring about a positive change in the lives of poor people, particularly in Asian and African countries. For example, Sri Lanka faced an acute economic collapse and the IMF helped it to recover from the immediate contingency, but the poor people have not benefited. Whether they would ever recover is uncertain, going by what has happened and is happening in the world. Poverty rate which was 14% before the crisis is 24.5% now and although the World Bank is all praise about the economic upturn there is no improvement in the poverty statistics or the perceptible living standards of the poor. In the world the rich are getting richer while the poor are left behind, despite the IMF.

IMF was formed in 1945 at the Bretton Wood conference and has a membership of 191 countries. The US is the biggest donor to the IMF and therefore holds the whip hand which it uses to further its own interests and also to maintain the status quo with regard to the global economic system which is in the grip of neoliberalism. The IMF cannot deviate from these neo-liberal policies which disallow government intervention and welfarism. Leading economists like Joseph Stiglitz, who was once the head of the World Bank, had severely criticized these policies.