IMF criticized in Kenya

[Robert Weissman <rob@essential.org>]

                               Agency criticises IMF on graft

                               The Nation (Nairobi)
                               July 20, 1999
                               By Nation Correspondent

                               Nairobi - A leading British NGO has
criticised the International Monetary Fund's approach to tackling
corruption in
                               Africa, saying that it is exacerbating the
problem.

                               In a week which saw the IMF spell out their
conditions for a resumption of loans to Kenya, Christian Aid wants the
                               Washington-based institution to look again
at the whole issue of structural adjustment and the Enhanced Structural
                               Adjustment Facility (Esaf) conditionally.

                               It says the biggest problem for Esaf
conditions is that they are imposed, rather than agreed on.

                               In particular, Christian Aid wants the IMF
and the World Bank to explore the possibility of setting up national debt
                               relief committees to oversee debt relief
programmes and ensure that money saved in the future goes to the poorest
                               sections of society.

                               It gives the example of the Nairobi-based
All Africa Council of Churches plea for a national stakeholders committee
                               based on representatives from local civil
society groups, the church, the government and parliament and the
creditors.

                               According to the London-based agency's new
report, Curbing corruption: a people's approach to debt relief, IMF's
                               conditions imposed under their Esaf
programmes have "undermined democracy by making governments more
                               accountable to creditors than to its people.
The current terms and conditions demanded by institutions such as the
                               IMF in return for aid and debt relief are
making corruption worse."

                               The report adds that in many cases, IMF
conditions have "forced governments to impose draconian measures directly
                               against the wishes and interests of its people."

                               Moreover, the Esaf conditions do not lead to
a curbing of corruption, Christian Aid says.

                               "While creditors, the World Bank and the IMF
talk loudly about the problem of corruption, their policies,
                               particularly in the Esaf programmes, have
exacerbated rather than helped stop corruption."

                               Christian Aid is in particular critical of
the IMF and World Bank's insistence on privatisation programmes, arguing
                               that "the push for privatisation has been a
major source of corruption and wasted resources".

                               Because one consequence of IMF imposed
cutbacks is cuts in public spending, particularly for pay for civil
servants,
                               doctors and nurses, this has "increased the
risk of petty corruption."

                               Based on it experience with partner
organisations in countries throughout Africa, including Kenya, Uganda and
                               Tanzania, Christian Aid says a new 'people
centred' approach to corruption and debt relief should be made.

                               "Contrary to the image many hold of poor
countries, people living in poverty are themselves confronting
                               corruption," the report says. "Many of
Christian Aid's partners emphasised that national debt relief committees
                               should be bolstered by greater parliamentary
control over debt relief and any new loans.

                               "In the long run, it is active 'watchdog'
parliaments, representing the people who elected them, who offer the best
                               safeguard against abuses of power and waste
of money by the government. Our partners in countries as diverse as
                               Uganda and Brazil are working towards this
end by collaborating with and actively pushing their parliamentarians to
                               take up debt relief issues."

                               Christian Aid says that debt relief with
greater control by the community is already being developed by indebted
                               countries and it says the best examples are
Uganda and Tanzania.



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