In response to sharp criticism and the growing body of evidence of harm caused by austerity, the IMF has been implementing a practice known as ‘social spending floors’, introduced in a strategy formalized in 2019. These are often ‘soft’ lending conditions designed to protect people from the sharpest edges of austerity. These measures represent an encouraging step forward, but have they been effective?
Using detailed analysis of 17 loans, Oxfam has found that while an improvement, social spending floors nevertheless are failing to do what they are intended to do. At the same time, their existence arguably obscures and postpones the fundamental strategic questioning of the necessity of the IMF’s blueprint of rapid and harmful austerity.
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