Mary Upton (Dublin South Central, Labour)
Link to this: Individually | In context

Question 19: To ask the Minister for Foreign Affairs if he is concerned at the development consequences of the conditions being imposed by the International Monetary Fund on some of the world's poorest countries, for example Mali, where such conditions have resulted in human disaster. [20939/10]

Peter Power (Limerick East, Fianna Fail)
Link to this: Individually | In context

Debt relief under the two main multilateral initiatives to tackle the debt burden on developing countries, as well as loans from the International Financial Institutions, are often conditional on the implementation of certain macro-economic and development policies. To be eligible, countries must demonstrate their commitment to sound economic management and poverty reduction through the implementation of a national Poverty Reduction Strategy. The purpose of such conditions is to ensure that countries have the right governance frameworks in place to manage their economic and social development in a sustainable manner.

In March 2009, the International Monetary Fund updated its conditionality framework in the context of a comprehensive reform to strengthen its capacity to address economic crises. The main result is a commitment that conditions linked to IMF financing will be sufficiently focused and adequately tailored to individual countries' policies and economic environments.

Last month, I visited Washington for the development discussions at the Spring meetings of the World Bank and the IMF. I reiterated the Government's clear view that international policy and lending must be focused on the development needs of least developed countries and that this must be reflected in the ongoing reform processes of the International Financial Institutions. Ireland will continue to monitor the pace with which the World Bank and IMF review their policies on conditionality. In cooperation with other partners, Ireland will maintain pressure to ensure that, in all cases, conditionality is appropriate in terms of scope, content and application.

We believe that all development interventions, including those of the International Financial Institutions, should be framed very clearly in the context of country ownership, poverty reduction and the achievement of the Millennium Development Goals.

The Deputy refers in particular to Mali, which is one of the 25 poorest countries in the world. Mali has made significant progress in recent years, particularly as a result of the granting of total debt relief by the international community. However, despite political and economic progress, Mali does not have a strong track record in translating overall economic growth into poverty reduction and the country remains heavily reliant on donor funds. It suffers from low levels of political participation, and has one of the worst records on adult literacy in Africa. Mali continues to face political, security and economic and social challenges.

In February the International Monetary Fund completed its third review of Mali's economic performance under a programme supported by the Extended Credit Facility. The review was broadly positive, encouraging the Government of Mali to continue with the promotion of sustainable economic growth, with the objective of improving living standards, reducing poverty and making progress on the achievement of the Millennium Development Goals.