For years, environmentalists around the world have been concerned about the impact of the IMF and World Bank's economic development approach on the global environment. While the World Bank instituted policies to incorporate environmental considerations in its project lending, it has not extended these policies to structural adjustment policy lending, which today represents more than half of its portfolio.
The IMF claims to defer to the World Bank on environmental matters, but promotes export-led development that has major environmental impacts without asking the World Bank for any formal assessment of the environmental implications of its approach. The World Bank has failed to provide environmental guidance to the IMF, and is even delinquent in assessing the environmental impacts of its own structural adjustment loans. A recent internal World Bank study found that fewer than 20 percent of World Bank adjustment loans included any environmental assessment. Nor does the IMF require any written, public environmental analysis from the World Bank or other knowledgeable institutions.
A Guide to the International Monetary Fund
The International Monetary Fund (IMF) is one of the most powerful actors in the global economy. As a multilateral institution it lends billions of dollars to countries experiencing extreme economic imbalances and mobilizes billions more from rich creditor nations and other international financial institutions. The richest countries in the world have given the IMF the power to bestow a "seal of approval" on borrowers? economic policies. This seal of approval is necessary for poor countries to get debt relief from creditor nations, and it influences the decisions by private investors and aid agencies on whether to lend and invest in those countries. In this way, the IMF has tremendous power over lives around the world.