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Niger and the IMF

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Deutsch
The International Monetary Fund's Policy Advice
A Letter to the Editor
By Abdoulaye Bio-Tchané
Director, African Department
International Monetary Fund
Frankfurter Allgemeine Zeitung
August 9, 2005

FAZ has a reputation for careful analysis of the International Monetary Fund. So I was startled to read your accusations about the Fund's supposed role in the food crisis in Niger ("Von einer Hungerkatastrophe in Niger kann derzeit aber noch keine Rede sein", Aug. 3). It is wrong to assert that the approach of the IMF in low-income countries such as Niger can be simplified to "the market fixes everything." This reflects a misunderstanding of the process of economic policy making, the economic challenges facing Africa, and the current situation in Niger.

The IMF does not view development through an ideological prism. We work with a country on the basis of its own needs and capabilities, including the financial resources it can bring to the development process. There is also the question of national sovereignty, which in the case of Niger—with its democratically elected government and active civil society—is a paramount factor in determining the course of economic policy. We do not "dictate" policy, as you claim. We consult and advise.

The IMF's policy advice to Niger is drawn from a Poverty Reduction Strategy designed by that country's government (and available www.imf.org). It identifies priorities for strengthening economic growth and reducing poverty, particularly focusing on increasing spending that will give vulnerable groups access to basic social services and on agricultural development. The strategy also emphasizes the need to preserve fiscal sustainability. Thus, there is a focus on strengthening revenue mobilization, improving public expenditure management, and ensuring the orientation of spending toward pro-poor and pro-growth projects.

With regard to the current situation, there is absolutely no truth to your suggestion that IMF policy advice has impeded free food distribution. The IMF fully supports all government spending aimed at addressing the food crisis and alleviating the effects of the drought. Regarding the assertion that we have insisted on an "education rate of at least 50 percent," I challenge your reporter to point to a single document on Niger published by the Fund that sets any such goal in this area.

In the current crisis, the IMF is working closely with other international donors to mobilize additional resources to address the food shortages and assist long-term development. We are prepared to increase Niger's access to Fund financing if grant aid is insufficient. In addition, the IMF has been at the forefront in stressing the need to increase investment in irrigation infrastructure to reduce Niger's vulnerability to drought. However you choose to define the crisis in Niger, the IMF will do everything in its power to assist in easing the suffering.




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