ALERT: GOLD SALES FOR DEBT CANCELLATION - NOT FOR THE IMF'S "ESAF"!

The U.S. Treasury Department plans to ask Congress very soon for authorization to sell part of the IMF’s stock of gold. Treasury and the IMF say that the proceeds would be used for debt relief, but in fact most of the money would end up going to the IMF’s Enhanced Structural Adjustment Facility (ESAF).

ESAF is the program which inflicts the harshest structural adjustment measures on countries whose governments can’t get credit or capital from any other source. Those measures, which require governments to emphasize export production over food security, lay off public sector employees, slash public spending (such as health and education), raise taxes, raise interest rates, open up economies to foreign corporations, end subsidies, and end support of local manufacturers have devastated economies around the world and left countries deeper in debt and more impoverished.

According to the IMF’s own staff review, annual real per capita GDP growth averaged 0.0% for countries with ESAF programs over the period 1991-1995, whereas non-ESAF developing countries experienced, on average, 1.0% annual real per capita GDP growth. African countries with ESAF programs fared even worse, with an average annual .3% decline in real per capita incomes over the period of IMF structural adjustment from 1991-1995. At the same time the external debt burden of ESAF countries has grown larger as a share of their economies.

The IMF claims that ESAF is an integral component of its approach to debt relief, because it is the IMF program designed particularly for severely-indebted low-income countries. The IMF refuses to participate in the World Bank-designed debt relief program (the Heavily Indebted Poor Countries [HIPC] Initiative, which is itself seriously flawed) until it gets all the funds it wants for ESAF. If it manages to get enough ESAF funding over the next year, it will be able to rely on repayments on loans to fund the facility indefinitely. That would mean that the IMF would be able to continue imposing structural adjustment perpetually, with no oversight from Congress or anyone else.

Many G-7 countries, bending to the pressure exerted by the international Jubilee 2000 movement, have put forward debt relief plans that would be financed largely by selling IMF gold. Their good intentions, however, will be canceled out by the damage wrought by structural adjustment if the money goes to ESAF.

Please write your members of Congress today to insist that IMF gold be sold to provide immediate debt cancellation for impoverished countries -- with no structural adjustment conditions attached. Demand that no further funding go to ESAF.

Write Representatives at: U.S. House of Representatives / Washington, DC 20515

Write Senators at: U.S. Senate / Washington, DC 20510

Call legislators through the Capitol switchboard: 202/224-3121

For more information, call 50 Years Is Enough: 202/IMF-BANK