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Oxfam Says IMF Loans Force Spending Cuts That Exacerbate Poverty

The vast majority of International Monetary Fund loans extended during the Covid-19 pandemic have suggested or demanded spending cuts that would worsen poverty and inequality, charity group Oxfam says.

Seventy-six of the fund’s 91 loans since March have sought belt tightening, according to Oxfam. The result could be deep cuts to public healthcare and pensions; wage freezes and cuts for workers such as doctors and teachers; and reduced unemployment benefits like sick pay, the group said Monday.

“The IMF has sounded the alarm about a massive spike in inequality in the wake of the pandemic,” said Chema Vera, Oxfam International’s interim executive director. But the measures it is advocating “could leave millions of people without access to healthcare or income support while they search for work, and could thwart any hope of sustainable recovery.”

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