IMF praise for Libya, other despotic regimes

A Reuters column (here) notes that only two weeks ago the IMF's board lauded the Libyan government, currently using mercenary troops to massacre protesters, for its "strong macroeconomic performance" and "ambitious reform agenda" and for "enhancing the role of the private sector", reports ITUC Washington's Peter Bakvis.

The IMF board heaped similar praise in recent months on the now-deposed autocratic regimes of Tunisia and Egypt during the annual IMF reviews of those countries' policies.

The pro-private sector policy that the IMF board found so laudable consists largely of the theft of Libyan assets by the Gaddafi clan. As an FT article published today (here) notes: "Muammer Gaddafi’s family has built up vast business interests in sectors ranging from oil to hotels during his 41-year rule, giving it a hold over large swathes of Libya’s economy.... [T]he ruling clan ... has such a grip on their country’s private sector that a US official dubbed them “Gaddafi Incorporated”."

IMF chief Strauss-Kahn last weekend underlined the failures of those who pay attention only to macroeconomic indicators and ignore issues such as lack of freedom and inequality: ".... what has happened recently in North Africa is, in my view, very closely linked to this -- the fact that both Tunisia and Egypt had rather good global indicators - growth, inflation.

But inequalities within the countries were such that, added to a demand for more liberty, which is more on the political side, it ends up as we know. So it means that we need to work more on this question of distribution of income, poverty lines."

It would appear that the DSK's criticism should be directed first and foremost against his own institution.