A not so fond farewell to the IMF

27Jul07

Nicaragua finalised their next agreement with the IMF earlier this month. According to the US Nicaragua Network, the IMF designated a total of US$90 million in loans for the next three years, U$30 million less than Nicaragua authorities were counting on. US$58 million will be loaned this year.

Daniel Ortega had earlier said this will be Nicaragua’s last agreement with the Fund. Nicaragua is looking seriously at alternatives to the IMF and World Bank, particularly the new Bank of the South. Launched in May by Argentina, Brazil, Bolivia, Paraguay, Ecuador and Venezuela, it is not being touted as an alternative to the IMF, but many will see it as that. In an anaysis by the IRC’s America’s Program (Bank of the South: Toward Financial Autonomy) it is seen as a way of financing some of the urgent social priorities in Latin America.

As Latin America grows increasingly confident in its rejection of the discredited International Financial Institutions, the World Bank has done nothing to increase its standing by the appointment of the replacement for disgraced Paul Wolfowitz. Robert Zoellick is cut from the same cloth as his predecessor, although perhaps a little more subtle. World Bank Gets Another U.S. Crusader details his contribution to Latin American understanding, including negotiating NAFTA with Mexico (which has seen poverty increase since the agreement was signed), the now dead in the water Free Trade Agreement of the Americas, and beginning the CAFTA negotiations. ALBA can expect a rush of new recruits in the not too distant future.

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