Not only is the overarching criticism incorrect, notes Lindsey, but the examples that Stiglitz provides of how market fundamentalism led the IMF astray are vastly over-blown. According to Stiglitz, Russia's difficult transition from communism, worsening poverty in Africa, the collapse of Argentina's economy--these all are manifestations of what happens when the IMF's market fundamentalists get their way. The fact is that there are all very complex situations on which there was, and remains to this day, plenty of disagreement about the right way to do things and who is to blame for things that have gone wrong. The IMF deserves its share of the blame, but so do many others.


Why is the IMF forcing indebted countries to lower public spending for growth? The IMF alleges that by reducing public spending, it helps African countries achieve greater growth, but in Africa, where there is a infrastructure deficit, I don't see how it can help. Moreover, reducing subsidies to local farmers will increase export deficits because local farmers are unable to compete. Is the IMF's main goal to help rich creditors? Because it would explain why African countries have very few numbers of votes within the institution.

It is claimed that conditionalities retard social stability and hence inhibit the stated goals of the IMF, while Structural Adjustment Programs lead to an increase in poverty in recipient countries.[148] The IMF sometimes advocates "austerity programmes", cutting public spending and increasing taxes even when the economy is weak, to bring budgets closer to a balance, thus reducing budget deficits. Countries are often advised to lower their corporate tax rate. In Globalization and Its Discontents, Joseph E. Stiglitz, former chief economist and senior vice-president at the World Bank, criticises these policies.[149] He argues that by converting to a more monetarist approach, the purpose of the fund is no longer valid, as it was designed to provide funds for countries to carry out Keynesian reflations, and that the IMF "was not participating in a conspiracy, but it was reflecting the interests and ideology of the Western financial community."

If they want to help African countries, why didn't they offer low-interest loans to Africa for massive infrastructure spending?

  • There have been many IMF conditional programs, in many different countries and at many different times. It would make your question more answerable if you focussed on some particular cases, rather than citing critical experts without much context (Greece is not Argentina is not "Africa" is not Russia). I doubt all IMF strictures against spending were appropriate and IMF doctrine has evolved. But I doubt even more that a blanket "they've always stood against useful programs helping the poor" is a valid characterization. It is a popular characterization, mind you. That I don't doubt. Apr 9, 2022 at 16:30

2 Answers 2


Because the IMF is not a development bank.

The IMF [...] provides short- and medium-term loans and helps countries design policy programs to solve balance of payments problems when sufficient financing cannot be obtained to meet net international payments obligations. IMF loans are funded mainly by the pool of quota contributions that its members provide.

whereas e.g.

The World Bank promotes long-term economic development and poverty reduction by providing technical and financial support to help countries reform certain sectors or implement specific projects—such as building schools and health centers, providing water and electricity, fighting disease, and protecting the environment. World Bank assistance is generally long term and is funded both by member country contributions and through bond issuance.

There are other development banks as well.

  • 1
    So, IMF is a loanshark.
    – M i ech
    Apr 19, 2022 at 6:25

I think that IMF's goal is making underperforming countries avoid defaulting and normalizing their balance. Growth is supposed to be a property of stable profitable economy, not a result of overspending credit money.

They're the highway patrol who tells you they are letting you go this time, if you are not speeding in the future. Your excitement with acceleration does not enter the picture.

  • 2
    Growth is also not a property of economies getting decimated by austerity. Ebola was single handedly exacerbated by the IMF forcing African countries to defund health programs. Corruption and misuse of IMF funds also becomes more prevalent when govt. regulation is crippled by imposed austerity. If "Growth is supposed to be a property of stable profitable economy.." none of the african economies grew with IMF's programs they all grew by overspending China's debt trap $
    – Ash Rivers
    Apr 18, 2022 at 21:06

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .