The IMF and debt worsen the Ebola epidemic

By Jérôme Duval
Member of the Citizen’s Debt Audit Platform

Publico, Feb. 1

Although the International Monetary Fund claims it is part of the solution, the IMF is really part of the problem of underdevelopment and has been for decades. The latest proof of this is that the conditions imposed on countries in need have had serious impacts on the development of these countries’ public health services. In some countries, this means letting epidemics destroy the lives of thousands of people. The latest example involves the Ebola epidemic.

The IMF is responsible for serious restrictions at this time in developing adequate health care systems. It is not only social movements in both South and North that make this claim. You find it in a study published in the Lancet Global Health magazine by several British universities (the University of Cambridge and of Oxford and the London School of Hygiene and Tropical Medicine).

As already indicated by Vicenç Navarro in his blog or Alexander Kentikelenis, professor of the University of Cambridge and research coordinator, in “The IMF policies have contributed to poorly funded, unprepared and understaffed health systems in countries with outbreaks of Ebola.” The organization, based in Washington, through anti-social conditions imposed together with their loans, prioritizes short-term economic objectives such as reducing debt, which in fact only serves to increase the need to pay it back forever. Bleeding resources to pay an illegitimate debt weakens the health system. For example, in Liberia, according to the World Health Organization (WHO), there were only 0.1 doctors per 10,000 inhabitants between 2006 and 2013, and 0.4 hospitals for 100,000 inhabitants in 2013.

Last Aug. 8, WHO declared the Ebola epidemic in West Africa an international public health emergency. After more than 20,000 people had been affected and more than 8,000 killed by the Ebola virus, the $30 million granted in October 2014 by the IMF emergency assistance to Guinea, Liberia and Sierra Leone was not enough to confront the drama of the situation (in that time, the epidemic had killed more than 1,200 people). In addition, these funds do not represent even half of the $300 million pledged during the G20 summit in November 2014 in Brisbane, Australia, nor do they cover the $372 million debt that these three West African countries built up within the international financial institution.

Finally, much of these funds had not even arrived in the country, given that they consist not only of donations, but also new loans or debt relief. Thus the IMF approved new credit lines for these three countries that will send them further into debt: $41 million for Guinea, $49 million for Liberia and $39 million for Sierra Leone. Meanwhile, Guinea, Liberia and Sierra Leone have to pay $100 million in external debt in 2014 and nearly $130 million more in 2015. A quarter of this sum will go to the IMF. The additional $150 million announced by the financial institution in early January 2015 arrived very late and only after several criticisms mentioned here of the poor management of the Fund.

Hypocrisy of Gates, Zuckerberg, Google

The hypocrisy of big donors is immense. According to the United Nations report of December 2014, “Socio-Economic Impacts of the Ebola Virus Disease on Africa,” only 23.4 percent of the $518 million pledged by the World Bank has been disbursed to date, and less than 10 percent of the $459.8 million announced by the European Union has reached its destination. The Bill and Melinda Gates Foundation has disbursed only 27.3 percent of the $50 million announced; not a cent of the $25 million promised by both Mark Zuckerberg (owner of Facebook) and by the Google Foundation has been seen. So many beautiful promises are still up in the air. …

Rather than counting on donations, new loans or debt relief, we should demand the immediate, total and unconditional cancellation of the external debt of West African countries affected by Ebola, such as Guinea, Liberia and Sierra Leone. That’s what the United Nation’s Economic Commission for Africa demanded on Dec. 15: “Donors have been quite generous announcing a debt relief, but will need to go further and fully cancel this debt,” said Carlos Lopes, secretary general the Commission on Dec. 15 in Addis Ababa (Ethiopia).

Obviously, this claim should be extended to all the poor countries, misnamed as “developing,” where 85 percent of the world’s population lives; their public debt (about $1.8 trillion) represents only 1 percent of the global debt. Relief will not affect the global economic balance; the only thing needed is the political will.

It is a good thing to increase the fiscal deficit when the health and lives of people are in danger. It is not we who say this, but, contradicting the usual conservative ideology of the IMF, Christine Lagarde, its director, who said it and acknowledged that the IMF doesn’t say it often. But we should not have to wait for great humanitarian crises such as that caused by Ebola for people to see the clear need to increase the deficit in order to fund social services. Also, international law requires that compliance with basic human needs is a priority compared to bleeding of resources to pay the debt.

The IMF, which inhumanely ignores serious human needs, must disappear; those responsible for its decisions should be brought to justice for their actions. The devastating IMF policies have damaged too many people through neoliberal debt programs to be allowed to continue with impunity. Similarly, the Spanish state should withdraw as soon as possible its Article 135 of the Constitution, which contravenes the international law that establishes the priority of human needs before any other expense — a fortiori, the debt service. This is a matter of human survival, not the accountant’s books.

Some references:

-Campaign Jubilee/Debt Campaign: Ebola: Drop the debt.

-Alexander Kentikelenis, Lawrence King, Martin McKee and David Stuckler, “The International Monetary Fund and the Ebola outbreak.” The Lancet, December 2014.

-Economic Commission for Africa: “Socio-economic impacts of the epidemic of Ebola in Africa.” United Nations, December 2014.

-”Ebola Epidemic Exposes the Pathology of the Capitalist System.” People’s Health Movement, August 2014.

Translation by Workers World managing editor John Catalinotto.