Participants in the Taegu (South Korea) Round Global Forum, which brought together economists and activists from around the world to consider new, people-centered directions for the global economy, drafted the following letter. Its demands are based on a keynote speech delivered at the conference by Walden Bello of Focus on the Global South (Bangkok) and the University of the Philippines.

It demands fundamental changes at the International Monetary Fund (IMF), including the formation of a commission composed mainly of civil society representatives to decide whether it should be closed.

After collecting signatures at both the Taegu conference and endorsers over the Internet, the letter was sent to the relevant officials on November 1, 1999. We note with some satisfaction that it was eight days later that Michel Camdessus announced his resignation as the IMF's Managing Director on November 9, thus meeting in part the letter's fifth demand. On December 14, as we were going to press with this issue of Economic Justice News, U.S. Treasury Secretary Lawrence Summers made a speech in which he outlined a new, more limited vision of the IMF, one where its involvement in the world's most impoverished countries would be sharply reduced. We are still assessing the full meaning of Summers' speech, and trying to determine whether the U.S. will really try to implement the goals it puts forth. If so, we could see the most fundamental change at the IMF since the early 1970s, and we might come closer to the realization of more of this letter's demands (we note also that Mr. Summers was among the recipients of the letter, since the Treasury Department exercises tremendous influence over IMF policies).

The remainder of the demands remain unsatisfied, however, and so we continue to collect endorsements of this letter, in collaboration with Focus on the Global South in Bangkok. Endorsers so far come from South Korea, the Philippines, Thailand, Singapore, Indonesia, Malaysia, Japan, Australia, the United States, Brazil, the Netherlands, the United Kingdom, Germany, France, Norway, Finland, Ireland, Kenya, South Africa, Pakistan, and India. To endorse the letter, please e-mail us at soren@igc.org or write 50 Years Is Enough Network / 1247 E St., S.E. / Washington, DC 20003 USA, or call 202/463-2265. We will be delivering the letter again as the list of endorsers grows.

8 October 1999

TO: Leaders of the G-7 Countries
    IMF Executive Directors
    International Monetary Fund Management

  We, representatives of civil society organizations gathered in Taegu, South Korea to consider strategies to counter the damage done by unregulated capital flows and the programs of the international financial institutions, take note of the International Monetary Fund's recent announcement that its structural adjustment programs will henceforth adopt a focus on "poverty reduction" and will be designed in conjunction with the World Bank, through a new facility to be known as the Poverty Reduction and Growth Facility.

  We welcome the IMF's acknowledgment, implicit in this news, that its programs have had a negative impact on impoverished peoples in the countries where it has imposed structural adjustment. We note, however, that this acknowledgment comes very late: organizations like ours have been pointing out the devastation caused by the IMF for over 15 years.

  We are alarmed, also, that despite the apparent admission of its incompetence in designing economic programs that will promote the welfare of the greatest part of countries‚ populations, this announcement indicates the following:

(1) that the IMF does not intend to withdraw from its involvement with impoverished countries, but that, on the contrary, it will now expand its mandate by designing and implementing poverty reduction programs;

(2) that the IMF has taken no steps to acknowledge the impact of its policy impositions in the countries of East Asia forced to accept "bailout" packages in 1997 and 1998; and

(3) the World Bank has apparently been chosen as the guarantor of the rights of the impoverished, although we know that its structural adjustment programs differ hardly at all from the IMF‚s in terms or impact, and despite the confirmation of this in a recent internal Bank report that finds the institutions paid no heed to the impact of its own structural adjustment loans on the poor populations they effect.

Recognizing the disastrous impact of the IMF around the world, we make the following demands:

1. That the IMF immediately cease imposing structural adjustment-style conditions in conjunction with any of its loans or programs.

2. That consequently the proposal for the new Poverty Reduction and Growth Facility (as successor to the Enhanced Structural Adjustment Facility) be immediately withdrawn as irrelevant.

3. That the assets of the ESAF/PRGF be used to cancel the debts the countries defined by the World Bank as heavily indebted poor countries owed the IMF, and that any remaining funds be used to cancel the debts owed the IMF by the additional countries appearing on Jubilee 2000 U.K.‚s list of 52 countries in need of debt cancellation.

4. That the IMF structural adjustment/stabilization programs imposed on the East Asian economies in the aftermath of the Asian financial crises be immediately discontinued.

5. That Michel Camdessus, the IMF's Managing Director for over ten years, and his top staff, including Deputy Managing Director Stanley Fischer, express a new spirit of accountability at the IMF by immediately resigning.

6. That moves to amend the IMF's Articles of Agreement to require member countries to liberalize their capital accounts be explicitly abandoned as incompatible with the lessons of several recent financial crises.

7. That a global commission with over half its members representing civil society organizations (with others from governments and the United Nations) be immediately convened to determine whether the IMF shall continue to exist and, if so, what role it should play.