Policy reforms mandated by the IMF between 1980 and 2019:
IMF Conditionality Dataset, 1980-2019
The purpose of this project is to compile a systematic, comprehensive, and publicly available database of IMF conditionality. Detailed information on conditions included in loans are sourced from internal IMF documents.
What is IMF Conditionality?
Among its various activities (including data collection, research, and training policy elites), International Monetary Fund (IMF) lending programmes to countries in economic trouble have attracted most attention. In exchange for financial support, borrowing countries agree to implement a package of obligatory policy reforms, or ‘conditionality’, phased over one or more years. The implementation of conditionality is then assessed on a quarterly or bi-annual basis determining the disbursement of IMF funds.
As a general principle, loans come with conditions attached, such as repayment in an agreed-upon timeframe at a specified interest rate. This practice is consistent with the motives of private financial institutions interested in making a profit using their capital. However, such conditionality does not necessarily reflect the motivations of loan-granting intergovernmental institutions, which typically have politically-determined priorities that go beyond profit-making, including economic development, poverty reduction, infrastructure financing, education expansion, and other such objectives.
Over the years, the IMF’s conditional lending practices have changed significantly. Until the 1980s, conditionality primarily required reforms to fiscal and monetary policy, as well as exchange rate adjustments, with the aim of reaching sustainable balance of payments. In the mid-1980s, the IMF expanded conditionality to bring about ‘structural adjustment’. This new approach advanced four main types of reforms: stabilization, liberalization, deregulation, and privatization. These policy conditions had a substantial impact on the underlying economic architecture of borrowing countries.
Conditionality has been linked to several detrimental economic, social, and political outcomes. On the economic side, IMF conditionality has been linked to reductions in economic growth and increases in inequality. On the social side, studies have found detrimental impacts to health systems in Africa and Europe, and identified adverse effects on population health. On the political side, research has linked conditionality to decreases in unionization and greater incidence of civil war.