Policy-based loans are large IFI investments that require
painful restructuring of poor country economies. The common
policy prescriptions, also known as loan conditionalities,
often require governments to implement reforms such as privatization
of essential services and cutting government spending that
reduce services to the poor. Often these reforms violate national
sovereignty by sidestepping legislative processes. They can
also violate human rights, for example by raising unemployment
and pushing the new jobless and the already poor into deeper
poverty. Multinational corporations benefit most from these
measures, for example, from privatizing water and requiring
unreciprocated unilateral trade tariff removal. Poor people—the
majority of whom are women—suffer from these measures
carried out in the name of poverty reduction.
Policy based loans come in many forms: when they began in
the early 1980s they were called Structural Adjustment Loans
or Programs (SALs or SAPs), Sector Adjustment Loans, Structural
Adjustment Facilities and Economic Recovery Credits. Due to
pressure from civil society groups regarding the negative
human impacts of SAPs, often they have been renamed Poverty
Reduction Support Credits (PRSCs) in the case of the World
Bank and Poverty Reduction Growth Facilities (PRGFs) in the
case of the IMF to indicate their close tie to Poverty Reduction
Strategy Papers (PRSPs). Despite their poverty reduction names,
PRSCs, PRGFs and PRSPs perpetuate classic policy prescriptions
that undermine poverty reduction (Engendering
Gender Action monitors the gender impacts of these programs
and carries out advocacy with local partners to mitigate the
harmful effects of donor-driven policy-based lending on low-income
women and men.
Women are the first to lose jobs and the last to be rehired in public sector downsizing because they are unfairly assumed to be secondary breadwinners although in reality increasing numbers of households are female headed. Their work at home tends to increase with the loss of child and health care programs. This squeezes out their time they can spend searching for new work and earning when they find jobs.
Men who lose jobs often turn to drinking and domestic violence
rises. The IFIs have barely addressed these destructive trends.
In late 2006 Gender Action published its Gender
Guide to World Bank and International Monetary Fund Policy-Based
Lending to provide tools to Southern and Northern citizens
groups to conduct gender analyses of World Bank and IMF policy-based
loans. We found that policy-based loans often aggravate discrimination
against women and girls by intensifying poverty, trafficking
in and violence against women, prostitution and sexually transmitted
diseases including HIV/AIDS. The Guide promotes alternative
economic policies based on country- and human rights-centered
approaches to development. Guide annexes include a toolkit
for stakeholders to analyze Bank and Fund policies and investments
for gender equality, a glossary of terms, and a list of resources.
Gender Action is following up this important work with workshops
and trainings based on the Guide.
Gender Action is a founding, active member of the first concerted
or Sink campaign against the IMF officially launched in
September 2006. Gender Action’s work exposes how IMF
policy-based loans violate women’s rights. For example,
IMF-mandated tariff reductions undermine the livelihood of
farmers, the majority of whom are women in the world’s
poorest countries. The campaign promotes citizen audits of
IMF debts with parliamentary participation and alternative
human rights-centered economic policies and financing mechanisms.
Together with the Bretton Woods Project, Eurodad, 50 Years
Is Enough Network, Focus on the Global South, Jubilee South,
and Jubilee USA Network, Gender Action co-sponsored a conference
on alternatives to strings-attached financing in Thailand
in July 2007.
In late 2007, the Shrink or Sink Campaign expanded into a
broader Anti-IMF Campaign. The campaign is finalizing a common
statement, creating working groups, expanding membership and
exploring projects. Watch for further news on the Anti-IMF
Gender Action launched its first Economic Reforms and Gender
program with local partners in Serbia and Montenegro where
in 2004 over 80 percent of World Bank investments supported
SAPs. Our Serb partners, the Belgrade-based Association for
Women's Initiatives, found the privatization program did not
consider any data on the social profile of employees who lose
their jobs in restructured enterprises. They concluded, "Without
such data it is not possible to create specific support programs
to increase self-employment, SME development and, job creation."