American politicization of the International Monetary Fund

Abstract

The International Monetary Fund claims that its loan conditions are apolitically devised because loans are negotiated by the technocratic staff and away from the possibly politicized Executive Board. Previous studies have suggested IMF Executive Board politicization but have not analyzed internal IMF documentation. Recently released IMF Article IV Consultations from the IMF Archives provide the opportunity for a new methodology based on searching for slippages in staff recommendations. It was found that two lenient IMF–Egyptian agreements had considerable slippages and two strict IMF–Egyptian agreements had little evidence of slippages. It was further found that the United States intervened in both the 1987 and 1991 agreements by usurping staff recommendations and undermining negotiations to ensure that these two agreements were lenient. The United States intervened in the 1987 and 1991 negotiations to preserve the political stability of the pro-Western Egyptian regime during a particularly turbulent time.