The most relevant effect of these IMF imposed policies, is the widening gap between the rich and poor countries. As globalization progresses, development gap has widened and the disparity between developed and underdeveloped nations when it comes to availability of opportunities, resources and wealth have been widely increased (Structural Adjustment Policies…. ). While the activities imposed by IMF under the tenets of globalization have been proven to have beneficial gains in developed countries, on the other hand, it delivered a wide variety of problems for less developed countries.
Few of the most pressing issues that strict adherence to IMF dictates in the globalized arena are as follows: (1) deprived access to water and sanitation; (2) inability to protect natural resources which results to increase in pollution; (3) high occurrences of HIV and increased number of deaths from curable diseases; (4) increasing number of illiteracy due to limited access to education; (5) people are either unemployed or underemployed; and (6) more and more people are living below minimum wage (Structural Adjustment Policies…. ).
Accordingly, it created avenues and more opportunities at pushing mass layoffs in employment area, cutbacks in providing social and public services, accelerated the destruction of environment resources and the loss of local authority over their own governments (Structural Adjustment Policies…. ). In addition, employment has been widely affected at the peak of globalization. The impacts of the policies have been highly global and encompassing that it has affected every member country that IMF had. IMF policies greatly influenced the stagnation of labor markets.
The direct economic impact of IMF in local areas has been so great that local authoritative forces has become less involved and less effective in managing local businesses including the right for maneuvering employment status of the people. Country Case Example The most adverse victims of the IMF regulations are those who belong in the Third World Countries. Take for example, the case of the Philippines. Philippines being a known ally of the United States of America, has been granted a number of loans from the IMF-World Bank.
One of the prominent debts were after the occurrence of World War, and during the terms of several Philippine presidents. And over time, drastic measures have already been undertaken for strict government compliance towards IMF policies. One of the calls that the Philippine government has complied to is the opening up of market and Philippines' natural resources and corporations towards foreign control. Through the Parity Rights Act, foreign entities were given and equal hand to manipulate Philippine resources.
A large number of formerly government owned and controlled corporations have been transferred to private entity control, which apparently is also allowed by the government. In addition, to attract foreign investors, the Philippine code was fabricated in a such a way that it created loopholes that can allow low wage for workers. And in most cases where industries are owned by foreign corporations, local employees and workers are held susceptible and vulnerable to abuse and maltreatment by their employers.
Further, development projects in industry areas funded by IMF also catered to foreign needs. The Subic area has been used both as an industrial center and at the same time a foreign controlled military camp wherein foreign armies control and occupies the area. Aside from being a military concentration camp visually and technically “owned” by the US Army, at the event wherein the site was no longer useful to them, it was turned into a dump site where the harmful toxics were thrown and disposed of improperly causing hazards and damage to local residents of the area.
Thus, the Philippine case alone is a proof of the atrocities that adherence to IMF have forced on their member countries. Years after the Philippines has joined the international institution, still, Philippines is one of the most deprived countries which belonged to the Third World group. The national budget is more driven towards repaying the debts which, at the end of year, the interest doubles thus making it even harder for the Philippine government to pay it. The results of such would be poor provision of social services in the country, which involves education, sanitation and health services among the few.
Another distinct and adverse effect of IMF policies in the Philippines, is the lost of sovereignty – both in making economic and political decisions. US through IMF has been able to manipulate Philippine government in such a way that the policies that are being passed strictly adhere to the wants and needs of IMF, US and other developed countries, rather than catering to Filipino citizens. Conclusion Thus, though IMF advocate “helping and catering to the needs of the underdeveloped countries”, international observation among its member countries could prove otherwise.
Strict adherence to their policies have been proven to be detrimental to the status of less developed countries. While it has promoted policies that catered to the needs of more powerful countries, it has done no good for the benefit of poor nations. Rather, poor nations have become subjects for mere oppression, injustice and source of raw materials and cheap labor for the benefit of more powerful and rich nations.
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