One of the critiques of the IMF, however, has been that the "austerity measures" which often come with IMF loans are disproportionately harmful to the citizens of the countries in question. Evidence for this has been anecdotal, until recently.
International Monetary Fund (IMF) loans were associated with a 16.6% rise in death rates from tuberculosis (TB) in the former Soviet Union and Central and Eastern European countries between 1992 and 2002, finds a study in PLoS Medicine.Fiscal restraint and economic conservatism in the interest of getting a nation's financial house back in order is one thing, but spreading TB is something else entirely. I believe that the IMF still has an important role to play to prevent economic collapse and dislocation in nations on the verge of sovereign bankruptcy, but this study makes it clear that the IMF will have to coordinate its lending efforts with efforts by its sister organization, the World Bank, to mitigate the worst of the social costs towards which its lending requirements may tend.
Between 1992 and 2002, most of the countries studied in this analysis received IMF loans for the first time. As Stuckler and colleagues note, "According to the IMF, the objective of these programs is to achieve macroeconomic stability and economic growth...", yet a recent report from the Center for Global Development has suggested that countries receiving IMF loans may constrain spending on health and social services. For example, countries receiving IMF loans might need to reduce social spending in order to meet the targets set as a condition of the loan, and do so by placing caps on public wage bills or by privatizing healthcare services. However, previously it has not been clear whether IMF loans are actually linked to any changes in measurable health outcomes. - ScienceDaily
The IMF and World Bank should together launch a new initiative to link IMF loans directly with World Bank programs to ensure the preservation and efficacy of healthcare and other critical safety net services in the country at risk. And this should become a standard practice for all future IMF interventions.