On Legal Issues Of IMF Conditionality

One of the purposes of the International Monetary Fund is to give confidence to members by making the general resources of the Fund temporarily available to them under adequate safeguards."Adequate safeguards"means that IMF could apply conditions to members in providing fund aid. In the process from the first appearance of conditionality in 1952 Executive Board Decision to further regulation of conditionality in 2002 New Guideline on Conditionality, IMF conditionality is being doubted and criticized in practice development. Especially after Asia financial crisis in late 90's and debt crisis of Argentina and other countries in the beginning of the 21st century, IMF conditionality is being animadvert fiercely than ever, no matter the substantial and procedural aspects. From various perspectives each side puts forward reform suggestions toward IMF conditionality. Meanwhile, the focus is gradually shifting to the reform of IMF and new international economic order.The thesis chooses the title"On Legal Issues in IMF Conditionality"and discusses some legal aspects of IMF conditionality. The thesis consists of four chapters: Chapter one is about definition and development of IMF conditionality. Through comparing definitions made by experts abroad and home and official reports, the first section makes definition analysis and draws a more comprehensive definition. On this basis, the second section gives a comprehensive introduction about the historical development of IMF conditionality.Chapter two is about analysis of legal regulations of IMF conditionality, which includes IMF agreement and Executive Board Decisions. The efficacy of law regulations about IMF conditionality in IMF agreement is higher than that in Executive Board Decisions, while Executive Board Decisions still play an important part in IMF conditionality practice. If IMF agreement is compared as skeleton of IMF conditionality, Executive Board Decisions are compared as flesh and blood of IMF conditionality. Chapter three is about study on legal problems of IMF conditionality, which includes discussion on substantial and procedural problems on the basis of definition, historical development and legal sources analysis of IMF conditionality. Substantial problems include ignorance of the special circumstances of member states, infringement of economic sovereignty of member states and little effect toward member states. Procedural problems include lack of transparency and reasonable voting system.Chapter four is about reform of IMF conditionality. On the basis of reform trends in IMF and reform suggestions developing countries and other aspects put forward, this part makes some analysis and draws some conclusions. Reform of IMF conditionality is still on the road. However, on the whole, the settlement of problems is amendment of IMF agreement, adding procedural stipulations, while the innermost lies on reform of the existing voting system and establishment of just and reasonable international economic order.