Successes of the International Monetary Fund: Untold Stories of Cooperation at Work

• Author: Edwin M. Truman
• Position: Senior Fellow, Peterson Institute for International Economics
• Pages: 55

Successes of the International Monetary Fund: Untold Stories of Cooperation at Work. Eduard Brau and Ian McDonald, editors. Palgrave Macmillan, New York, 2009, 231 pp., $34.95 (paper).

Page 55

Low bar’s tough patrons

THIS is an informative and useful collection of essays by International Monetary Fund (IMF) staff and associated commentaries by interested observers. The collection provides more fodder for supporters of the IMF than for detractors either on the left, who argue that the IMF is too harsh in its policy prescriptions, or on the right, who argue that the IMF is too lenient or misguided in its policy prescriptions.

The book’s six case studies of IMF financial assistance are of Korea 1998, Poland 1990–91, Turkey 2001–02, Tanzania 1995–2007, Brazil 2002, and Uruguay 2002–03. Each chapter includes a comment by someone who was either involved or a close observer of the program or activity. The commentaries add value, but they are not full-blown, objective critiques. In the interests of full disclosure, I was a participant in, or close observer of, four of the six country cases (excluding Tanzania and Uruguay) and all of the activities.

The principal value in these six essays is their focus on key decisions made by the authorities of the countries and the IMF. In five of the six cases, the episode described came at the end of an often protracted and less-than-successful sequence of programs and interactions between the country and the IMF. The authors do not fully acknowledge this fact in every case. The principal exception is the Uruguay case, though the transition program for Poland might also qualify. I was also struck by an irony in the Tanzanian case study. The IMF is credited both for advancing $400 million in financial support during 1995–2005 and for forgiving Tanzania’s remaining debt to the Fund in 2006.

Three essays on other IMF activities are largely descriptive, which does not detract from their overall usefulness for those who did not live through or do not remember clearly the events of the 1990s. The essay on the IMF staff ’s World Economic Outlooks usefully provides a longer history starting in 1980. However, it is more self-congratulatory than the other essays and less convincing as a result. Taken as a group, the case studies illustrate the wide variety of economic, financial, and political issues that arise with programs that receive financial support from the IMF. A reader would be hard-pressed to sustain the...