Concern Grows on Powerful Role for Imf
International Monetary Fund given key part in lending to countries worst affected by credit crunch
Gordon Brown proudly declared after yesterday's summit that it marked the end of the "Washington consensus," of liberalizing, privatizing and deregulating markets - yet one of the most significant decisions was to radically strengthen the International Monetary Fund, one of the two bodies that have promulgated the Washington consensus in far-flung corners of the world for the past half century.
The G20 countries declared that they wanted to see the IMF rebuilt, with a stronger voice for emerging economies - but the crucial details have been left to an ongoing reform process back at its HQ in Washington, to be finalized by 2011.
Meanwhile, with its resources tripled to a whopping $750bn (£507bn), the IMF will have an essential job in lending to credit-crunched countries and trying to prevent fresh crises erupting - and campaigners are nervous that the cash is coming first, before the reforms.
"This is an institution that has effectively just been given the world's check book," said Clare Melamed, head of policy at Action Aid. "Reform is now more urgent than ever." Or as a spokeswoman for Oxfam put it, "the IMF is big, it's bad and it's back."
A major worry is about the conditions placed on many IMF loans: in Eastern European economies such as Hungary, the tough policies demanded by the fund, including sharp budget cuts, are exactly the reverse of the fiscal expansion being pursued by the rich world. Whether any of this will change when the fund is shaken up is a question left unanswered at G20.
The G20 countries declared that they wanted to see the IMF rebuilt, with a stronger voice for emerging economies - but the crucial details have been left to an ongoing reform process back at its HQ in Washington, to be finalized by 2011.
Meanwhile, with its resources tripled to a whopping $750bn (£507bn), the IMF will have an essential job in lending to credit-crunched countries and trying to prevent fresh crises erupting - and campaigners are nervous that the cash is coming first, before the reforms.
"This is an institution that has effectively just been given the world's check book," said Clare Melamed, head of policy at Action Aid. "Reform is now more urgent than ever." Or as a spokeswoman for Oxfam put it, "the IMF is big, it's bad and it's back."
A major worry is about the conditions placed on many IMF loans: in Eastern European economies such as Hungary, the tough policies demanded by the fund, including sharp budget cuts, are exactly the reverse of the fiscal expansion being pursued by the rich world. Whether any of this will change when the fund is shaken up is a question left unanswered at G20.
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