The US Treasury Department criticizes the IMF and proposes changes in the organization's approaches

The United States has criticized the International Monetary Fund, suggesting changes to the organization's approaches. UNN writes about this with reference to the Voice of America.

Details

U.S. Deputy Treasury Secretary Brent Nieman, who is responsible for cooperation with the IMF, made comments on the IMF's work before the annual meeting of the IMF and the World Bank.

Niman said that the Fund's programs are often based on assurances of funding from international lenders, but if funding is not forthcoming, the organization often does not disclose details of the delay and the reasons for it.

Niemann cites programs in Argentina, Ecuador, and Suriname as examples. In Ecuador, the success of the program depended on funding from China, which did not provide assurances for the long term. The Fund did not directly name China, and in its documents only stated that the country was in talks with a "major bilateral creditor.

The official calls on the Fund to analyze more rigorously the economic capacity of countries that have a stable economic situation and access to the IMF credit line, including Mexico, which has a $90 billion line.

And in the area of overseeing countries' economies, the Fund pays less attention to international trade and exchange rate competition than it should, which is especially evident in the case of China, the official said.

Niman calls on the Foundation's shareholders to change the tradition of voting "abstain" instead of "no" to express their opposition to programs with problems.

The United States has criticized the Fund for sometimes continuing to finance a program even when the borrower does not fulfill its terms, just so that it can pay the Fund on its debts. If a country does not implement reforms, the Fund should choose to take over the debt, the official said.

The Fund has also reduced the average size of programs and relies on co-financing from other countries and institutions to increase its impact on countries at a time when they are facing economic crisis.

Niemann urges the Fund to be vigilant against funding that is not transparent and accessible. In countries where corruption, illegal activities, and violence are widespread, the IMF may involve third parties in the implementation of a program.

Recall

Ukraine and the IMF reach an agreement on the fifth review of the $15.6 billion financing program. Prime Minister Shmyhal said that Ukraine is fulfilling all reforms and structural benchmarks. Also , Shmyhal said that he expects a $1.1 billion tranche from the IMF in the near future.

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