The IMF is Responsive, Open and Helpful

Sir/Madam:

Mr. Akande ("IMF or God?," Dec. 6) offers a grab bag of criticisms of the International Monetary Fund that suggests little attention to the facts, including the reforms adopted in recent years.

He mischaracterizes the performance of countries in IMF-supported programs. For example, IMF support for Brazil in 1998 provided the advice and financing that allowed that country to rebound rapidly from the emerging markets crises. In Eastern Europe, IMF assistance has enabled several former Soviet states to make successful transitions to market economies-including Poland, Hungary, the Czech Republic and the Baltic nations. There certainly have been significant problems in some countries receiving IMF support, but to lay these difficulties solely at the Fund's door is dishonest and distorts the economic and political dynamics.

Mr. Akande also errs in describing the IMF as an institution that "plays God" in an atmosphere of total secrecy with no outside control. The IMF answers to its 182 member countries. Each has a voice on the Fund's 24-member Executive Board, which debates and approves all policies and programs, and the membership determines the Fund's agenda. Moreover, the Fund now regularly releases a veritable avalanche of information about its activities, including the documents for the programs it supports, detailed analyses of member countries' economies, and a host of papers on proposed reforms to the international financial system. All of this information is available on our website (www.imf.org), which receives over four million "hits" a month.

His description of the IMF approach to debt management is at odds with the truth, especially the assertion that the Fund "discourages debtor nations from going to the open market for new working capital." The decision to seek IMF assistance largely comes when countries have no other recourse, and reflects a loss of confidence by private markets. Fund-supported programs are designed precisely to enable countries to meet their debt obligations and return to the capital markets as soon as possible.

Finally, the description of the IMF as a "totalitarian" organization does little justice to the consultative process that produces Fund-supported programs. Program negotiations are usually drawn-out processes in which countries seeking Fund financing-as well as the international community-have a full say in determining the terms of an agreement. For example, the Fund, working with the World Bank, is encouraging poor countries to work on poverty reduction through a participatory process involving private groups, governments and aid donors.

There is no question that the IMF has made mistakes over the years, and these errors have brought considerable soul searching. The Fund's new Managing Director, Horst Köhler, has called for a return to basics to ensure that the IMF can best serve the needs of the international community. Informed criticism of Fund activities serves this process, but instead, Mr. Akande chooses to serve up half-truths.