Use of IMF Credit The maps show the upward global trend in use
of IMF credit This indicator can, in some respects, serve as a proxy for the general economic health of a country or region, with rapid increases in the use of IMF credit corresponding to times of widespread economic crisis. However, it is important to note that when using the "use of IMF credit" indicator is that there it does not describe the conditions upon which a country is allowed to draw on funds at the IMF. Using IMF funds does not necessitate a structural adjustment program, and many countries drawing on IMF funds need not enact any policy reforms in order to be approved to receive funding. The IMF does, however, provide consultation and advise to all countries that draw upon their credit. Regional Observations: In Latin America and Sub-Saharan Africa, we
observe large jumps
in the average use of IMF credit between
the 1970s and 1980s (see figures 2 and 3). These increases
are directly attributable to the world debt crisis of 1982
and its aftermath. As illustrated in the graphs below, growth
in the use of IMF credit in both Latin America and Sub-Saharan
Africa is rapid between 1982 and 1987; the increase is particularly
dramatic in Latin America. Following the 1982 debt crisis,
use of IMF credit in Sub-Saharan Africa is sustained just below
its peak in 1987, indicating ongoing economic hardship and
continued adjustment in the region. Use of IMF credit in Latin
America has been more volatile, with large increases associated
with both the 1982 debt crisis and Mexico's economic crisis
in 1994. In the 1970s and 1980s, countries in the East
Asia and the Pacific regions drew a relatively smaller amount
from the IMF than Latin America and Sub-Saharan Africa, particularly
with regards to the size of the economies that encompass the
East Asia region (including China, Japan, and South Korea).
However, with the onset of the East Asian financial crisis
in 1997 we observe dramatic increases in the use of IMF credit
between the 1980s and 1990s on the maps (see figure 4). Of
particular note are the increases in South Korea, Vietnam
and 
Another noteworthy measurement is the relative size of the regional economies mentioned above in the world economy compared to the share of total IMF credits that these regions draw upon. According to World Bank data, Sub-Saharan Africa typically produces just over 1% of global economic output, comprising just under 1.2% of total world GDP between 1970 and 2000. During this same time period, Sub-Saharan Africa drew on an average of 15.7% of all IMF credit dispersals. Similarly, while Latin America's share of world economic output averaged 6% from 1970 to 2000, the region absorbed 32% of all IMF credit dispersals during this phase. In contrast, Latin America and Sub-Saharan Africa contribute far less to funds at the IMF than the United States, Japan, and the EU. Distribution of IMF funds to the developing world can, in a sense, be seen as a transfer of subsidized loans from developed to developing nations. On the other hand, IMF credit dispersals are used in part to repay debts to private lenders from industrialized countries, and allow those with more control over the allocation of funds at the IMF a large say in how recipient countries set economic policies. Thus, control of IMF funds give industrialized countries leverage in economic policymaking decisions outside of their own national borders, and are used in part to bail out private international banks that invest in risky segments of the developing world. The following map shows the concentration of voting power at the IMF in the industrialized west, Saudi Arabia and Japan:
Caveats and Methodological Issues of the "use of IMF credit" indicator A methodological problem associated with this data set involves deflating prices into "real" as opposed to "nominal" terms to allow for an accurate comparison of the indicator between decades. The data available was given in nominal terms - a measure called "current US dollars". This measure indicates the number of dollars dispersed to countries at the time of arrangement, but fails to take inflation into account and therefore distorts the results by not accurately reflecting the purchasing power of the credit issued. To deflate the data the UC Atlas of Global Inequality uses an indicator called the US "Consumer Price Index", or CPI. This allows us to look at the data in "real", or inflation adjusted terms that make the dollar value of the data equivalent for every year. There is an additional methodological issue associated with this method, however. Deflating data by US CPI shows us what US citizens must give up to provide credit, but does not necessarily accurately reflect what the recipient country is able to purchase with the aid. In order to show this, the data would have to be put in terms of the currency of the recipient country and deflated by the recipient country's CPI. Due to a lack of data, we were unable to run this calculation. The data, however, still accurately displays the relative intensity of IMF lending in different countries and regions over the past three decades. |
over the past three decades, representing the
growing presence of the IMF in the international economic arena.
Correspondingly, the maps show the growing importance of the
IMF as an international economic regulatory institution, playing
an increasingly large role in determining national economic
policy and structure. According to World Bank data, the average
overall use of IMF credit per decade increased, in real terms,
by 21% between the 1970s and 1980s, and increased again by
just over 22% percent from the 1980s to the 1991-2000 period
(see figure 1). Average per country use of IMF credit over
these time periods increases at similar rates. 
.