What are the advantages and disadvantages of IMF and world bank
(IMF) Disadvantages of the IMF 1.
charged on its advances are considered one of the major disadvantages of IMF. So, the debt servicing for the less developed countries is difficult. For example, since 1982 the interest charged for loans out of the ordinary resources of the fund is 6.6 per cent. The interest rates payable on the loans made out of borrowed funds is as high as 14.56 per cent. So, developing countries experience a lot of difficulties in redeeming their loans borrowed from the IMF.
Top Ten Reasons to Oppose the IMF | Global Exchange
The stringent conditions imposed by IMF on its member nations are one of the big disadvantages of IMF. The IMF is criticized for its strict conditional clauses while extending credit to member countries. Till 1970, the conditional clauses attached to loans were not stiff. The IMF insisted that the borrowing countries reduce public expenditure in order to tide over BOP deficits. But after 1970, the IMF imposed stiff conditional clauses. Among them are periodic assessment of the performance of the borrowing countries with adjustment programmes, increases in productivity, improvement in resource allocation, reduction in trade barrier, strengthening of the collaboration of the borrowing country with the , etc.