Living in the IMF’s World
It is difficult to decide whether officials of the International Monetary Fund (IMF) are blind, stubborn, ignorant or all of the above. On the same day that tens of thousands of Colombians marched through the streets of Bogotá to protest a proposed free trade agreement with the United States, Anoop Singh, the IMF’s director for Latin America, said that the elections in nine Latin American nations next year are “an important opportunity for continuing with reforms that have already raised growth in the region.” In other words, Singh believes that Latin Americans have an “opportunity” to endorse the IMF-imposed neoliberal model by electing leaders who will continue implementing structural reforms. Why, given the recent swing to the Left of Latin American voters, continuing widespread protests against neoliberal policies and the growing regional popularity of Venezuelan President Hugo Chávez’s anti-neoliberalism, would Singh for a minute imagine that Latin American voters would turn to the Right?
While it is true that several left-of-center leaders, particularly Lula of Brazil, have continued to implement neoliberal economic reforms, they have also tried to place greater emphasis on wealth redistribution. And while many citizens have become frustrated with elected leaders who continue to toe the IMF line, there is little likelihood of them suddenly turning to even more adamantly pro-neoliberal candidates for salvation. In fact, it appears that next year’s elections could further increase the number of left-of-center parties in power in the region.
Leftist parties could come to power in Mexico, Nicaragua and Bolivia in 2006. In all likelihood, they would follow in Lula’s footsteps and feel compelled to abide by IMF conditionalities while simultaneously attempting to implement carefully managed redistribution. There is, however, the possibility that some newly-elected regimes might develop close ties to Chávez. Smaller economies like Bolivia and Nicaragua could benefit greatly from aid and trade with Venezuela in order to reduce their reliance on the Washington-based IMF and World Bank. Such an occurrence is a distinct possibility if Evo Morales proves victorious in Bolivia and the Sandinistas return to power in Nicaragua.
Another electoral shift to the Left in the region would further illustrate that Latin Americans, despite the assertions of the IMF’s Singh, do not view the continuance of neoliberal reforms as an opportunity. Even in Colombia, where the Left is unlikely to win the presidency in 2006, much of the population remains unhappy with the government’s economic performance. President Alvaro Uribe’s popularity is solely based on his security program, not his economic policies. Despite impressive economic growth in recent years, there has been no reduction in the country’s poverty level, as the wealth from that growth has not reached most Colombians. Currently, 64 percent of Colombians live in poverty—85 percent in rural regions. Many among the country’s workers, peasants and indigenous population continue to protest the Uribe administration’s implementation of neoliberal policies.
Singh’s recent comments and continuing IMF policies illustrate the degree to which the IMF remains out of touch with the wishes of the majority of Latin Americans. In several countries, the IMF continues to impose neoliberal policies on governments that were elected on anti-neoliberal platforms, thereby making evident the authoritarian nature of the lending institution as it undermines democracy in the region.
The authoritarian nature of the IMF was also evident in its September review of the Colombian government’s economic policies, as called for under the financial institution’s $613 million loan agreement signed with Colombia in April 2005. In its report, the IMF was pleased to note that the Colombian government was intending to implement the required neoliberal reforms undemocratically: “Structural reforms will continue to advance. The government intends to implement as many provisions as possible of the revised budget code through decree or other actions that do not require legislation.”
The anti-neoliberal protests that recently brought down governments in Bolivia and Ecuador show how fragile formal democracy can be when elected leaders represent the interests of international financial institutions rather than those of their citizens. Meanwhile, the IMF continues to point to the region’s recent economic growth as evidence of neoliberalism’s success while stubbornly and patronizingly refusing to acknowledge the wishes of the majority of Latin Americans who have not benefited from this growth.