[stop-imf] Nicaragua/India: IMF, World Bank worsen crises

[Robert Weissman]

http://www.s-j-c.net/9Oct2001.htm
Tuesday, October 9, 2001

Immediate release

Drought in Nicaragua - the IMF denies assistance, stops debt relief

Floods in India - the World Bank increases the price of water

The Social Justice Committee asks the international financial institutions
to stop forcing damaging economic programs on countries in crisis.

The International Monetary Fund (IMF) and the World Bank are imposing
their conditions on Nicaragua and India without taking into consideration
the disasters that have occurred recently in these countries.

There has been widespread, worsening hunger in Nicaragua since the
beginning of the year, with flooding, drought, and collapsing coffee
prices hitting the country with a series of devastating blows. A
million-and-a-half Central Americans are suffering from hunger following
the three-month drought. Floods on Nicaragua=92s Atlantic coast destroyed
crops of rice, corn, yucca, and bananas, with some 1,400 families now
eating the seeds that they used to give to pigs that were swept away by
the floods. Their children dying of hunger, 10,000 families have left the
coffee plantations where they lived, worked, and grew some of their food,
because of the collapse of coffee prices.

Despite the situation of the country, the IMF continues to demand that the
Nicaraguan government slash spending, pull money out of circulation, and
privatize public utilities. The IMF has just determined there has been a
failure to comply, and suspended Nicaragua=92s debt relief program
indefinitely. Future IMF support will be denied, which in turn endangers
World Bank development assistance..

In India, flooding in recent weeks has devastated the State of Orissa. At
least 31 people have lost their lives, and 50,000 people are living in a
region inaccessible to relief services.

Yet the World Bank has demanded an increase in the water tariffs. Rates
for water for irrigation will be doubled or tripled, in a program forced
through a divisive and angry state government session at the end of
September, as flooding reached its peak. This increase will have serious
repercussions on the next harvests because it will increase considerably
the cost of food production and their sale prices. The people of Orissa,
one of the poorest states in India, have reason to be concerned about
their future capacity to buy food as the World Bank demands "cost
recovery" on the use of water.

By imposing inappropriate demands on countries in crisis, the IMF and
World Bank worsen the situation of the population in the short and the
long term.



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