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IMF: Scant transparency for COVID-19 emergency loans

Anti-corruption measures a step forward, but weak implementation

The International Monetary Fund (IMF), despite overall progress in its anti-corruption efforts, has not ensured sufficient oversight of its COVID-19 emergency loans, Human Rights Watch and Transparency International said today. As a result, it is hard for members of the public in many countries to track the governments’ COVID-19 spending, to identify potential corruption or to determine whether the deprivation of basic rights connected to the pandemic is being addressed.

Human Rights Watch and Transparency International assessed the effectiveness of the IMF’s approach during the pandemic by analysing how well four governments – Cameroon, Ecuador, Egypt and Nigeria – carried through on the measures included in their loan agreements. Between January and March 2021, the organisations analysed documents published by these governments, as well as loan agreements and other documents published by the IMF.

See the analysis

Since March 2020, the IMF has provided about US$108 billion in financial assistance to around 85 countries to support their response to the pandemic. Due to the IMF’s improved attention to combating corruption, about half of these loan agreements included specific anti-corruption measures related to COVID-19 spending and procurement. In some cases, the IMF obtained strong transparency commitments that spurred publication of valuable information. Some governments amended procurements rules to enable publication of the names of beneficial (that is, real) owners of companies awarded contracts. This information is key to preventing conflicts of interest and tax evasion and allowing the public to track who benefits from public contracts. However, weak implementation impeded the potential of this progress.

"The IMF’s call to governments during the pandemic to ‘spend as much as you can but keep the receipts’ showed concern for corruption risks,” said Sarah Saadoun, senior business and human rights researcher at Human Rights Watch. “But this approach will only be effective in addressing rights issues if it ensures that those ‘receipts’ are publicly accessible, comprehensive and credible.”

Transparency International also conducted a comprehensive review of anti-corruption measures included in emergency loan agreements prior to 23 July 2020, at which point most of the IMF’s immediate COVID-19 support had been approved. In Cameroon and Nigeria, Human Rights Watch interviewed medical staff and people who lost earnings due to the pandemic. Human Rights Watch, in March 2021, wrote to the finance ministries of each of the four governments and to the IMF. Only the IMF responded, which is reflected in the analysis.

The IMF’s approach to stemming corruption for its emergency lending relies heavily on public oversight, particularly from civil society groups and the media. To facilitate oversight, the data needs to be accessible and sufficiently detailed to assess and track spending, and conditions need to be in place to ensure that concerns can be raised safely. The IMF also needs to remain actively engaged to ensure robust implementation by governments, including through future surveillance and lending programs.

To its credit, the IMF has increased engagement with civil society groups since the onset of the pandemic, including by initiating workshops and calls with IMF staff. The IMF also met with civil society groups, though typically after loans were already approved.

“The IMF has made progress ensuring greater transparency in its loan agreements, but this needs to go much further,” said M. Emilia Berazategui, Global Advocacy Lead at Transparency International. "Successful anti-corruption outcomes take time and perseverance. If the IMF wants to ensure that the most vulnerable communities receive the support and resources they are promised, it is critical that they continue to press governments to prioritise integrity and transparency. The COVID-19 pandemic has made clear that this is a matter of life and death.”

Robust IMF lending is critical for many governments to have sufficient resources to respond to the pandemic by providing adequate and accessible healthcare as well as addressing its economic impacts. It is equally critical for governments to spend these funds transparently and accountably so they reach those in need. To build on its progress and ensure an effective approach to anti-corruption, the IMF should:

  • Ensure that governments receiving the money make specific, concrete, and time-bound commitments as part of the loans agreements.
  • Work with governments to clarify and detail best practices for fulfilling transparency commitments, including those related to user access, and beneficial ownership information.
  • Host a database of relevant documents to standardize the format and facilitate universal access. Pursue a consistent approach to assessing government implementation and linking findings to surveillance and lending transparency.
  • Demonstrate how its spending secures basic rights for all without discrimination, including the right to health and to an adequate standard of living. It should consult with civil society as part of its assessment and publish the results.
  • Publicly report on the level of implementation of the transparency/anticorruption commitments that governments made as part of the loan agreements.
  • Revise its 2011 policy on emergency assistance or separately develop guidelines for addressing corruption risks in crisis situations.
  • Ensure that governments credibly carry out commitments to conduct and publish audits in a timely manner.



Human Rights Watch

Sarah Saadoun

E: saadous@hrw.org

T: +1-917-502-6694

Transparency International Press office

E: press@transparency.org

T: +49 30 34 38 20 666