The Role of the IMF in Health Budgets
Source: International Budget Project (IBP)
In September 2006, the Dutch NGO Wemos issued a report describing case studies it conducted in Ghana, Zambia, Kenya, and Uganda to examine the role of the International Monetary Fund (IMF) in determining national budget allocations for health, particularly for health workers’ salaries. Wemos works with civil society organizations in developing countries to exchange information and promote activities to influence health policy at national and international levels.
If low-income countries are to achieve the health-related Millennium Development Goals (MDGs), they will have to invest substantial new funds in the health sector. New investments are particularly needed to obtain qualified health personnel, since many developing countries face a considerable shortage of health workers. The IMF, however, believes that public expenditures must be restricted in order to maintain macroeconomic stability and thereby promote economic growth, which is needed to deliver the resources for the health and education sectors.
Wemos’s new report argues that the budget ceilings imposed by the IMF are ineffective and damage the health sector. Although the ceilings permit exemptions if extra money becomes available, these increases do not approach the amounts needed to achieve the health-related MDGs. Moreover, the IMF’s macroeconomic policymaking does not take into account the social and economic impact of insufficient investments in the health sector.
Not only should the IMF improve its analysis and advice, the report states, but donors should increase their health-related assistance and provide predictable and sustainable aid levels. (The IMF could help ensure that donors keep their aid promises.) It is also important for governments to improve their expenditure patterns.
Click here to read the full report