…or, just how DOES the IMF affect health policies in developing

countries?

Gold sales, wage bill caps, workforce shortages

Julia RobinsonHealth Alliance International

3 April 2009

Wage ceilingsIMF writes conditions

into its loans restricting spending on certain sectors – namely education and health – in an effort to reduce deficits and inflationCenter for Global

Development report (2007) showed that half of all countries receiving IMF loans included wage bill ceilings

This, in turn, leads to…

Workforce shortages!Artificially low budget ceilings mean that

countries cannot hire enough workers to adequately staff health sector

Problem compounded by countries facing high disease burdens (HIV, malaria, tuberculosis…)

Gold salesFirst part of this decade, IMF looking less

and less relevant 2007: Experts forecast $360 million loss of

IMF assets; IMF looks to SELL GOLD RESERVES in an effort to pay for administrative costs

BUT, the sale of gold requires approval of US Congress!

Advocacy opportunityLimit wage ceilings

that contribute to health and education worker shortages

Rescind the use of restrictive deficit- and inflation-reduction targets, which limit countries’ ability to grow their economies

Reform governance structure of IMF

Gold sales update• So many Eastern European countries

(Ukraine, Hungary, Latvia, Belarus, more!) taking out loans that the IMF is projecting a $650 million dollar profit next year!

• Which means no more need to sell gold = • “Gold sales have fallen right to the bottom of

the IMF’s list of priorities and it is doubtful they will be lobbying very hard for it any more…” • – Claudio Loser, former director of IMF’s Western

Hemisphere Dept.

New directions for gold sales

• Debt Relief

• Reform of IMF governance and policies