NGOs Accuse IMF Of ‘Colonial Debt Enforcement’ In New Global Report

A coalition of international organisations has accused the International Monetary Fund (IMF) of perpetuating “colonial-style” economic policies that disproportionately harm low-income countries, despite its public commitment to reform.

The criticism is contained in a new report released on Tuesday by ActionAid, Education International and the Tax and Education Alliance, alongside several partner organisations.

Titled Still Cooking with a Failed Recipe, the report argues that the IMF continues to impose rigid fiscal policies that prioritise debt repayment over essential public services such as healthcare and education.

Spending Gaps and ‘Double Standards’

According to the report, African countries spend an average of 7.6 per cent of their national budgets on public sector wages—below the global average of 9 per cent—yet are still urged to cut spending.

The report highlights what it describes as stark double standards in IMF advice. While countries like the United Kingdom are encouraged to increase public spending—currently at 15.9 per cent of GDP on public workforce—lower-income nations such as Nigeria and Nepal, which spend significantly less (1.9 per cent and 2.5 per cent respectively), are advised to freeze or reduce expenditure.

The organisations argue that such policies undermine the ability of developing countries to rebuild their economies while servicing external debt obligations.

‘Outdated Recipe’ for Development

Secretary-General of ActionAid, Arthur Larok, described the IMF’s approach as outdated and harmful.

“The IMF’s recipe book is completely outdated. By forcing lower-income nations to squeeze public workers, cut social spending, and prioritise foreign creditors, the IMF is functioning as a global debt enforcer rather than a development partner,” he said.

The report is based on an analysis of 29 IMF documents spanning February 2022 to February 2025 across 11 countries, including Nigeria, Ghana, Kenya and Brazil.

Impact on Social Services and Gender Equality

The study found that IMF-backed policies often result in reduced funding for critical social programmes. In some cases, countries such as Senegal reportedly allocate as little as 0.1 per cent of their budgets to social programmes, compared to around 20 per cent in the UK.

It also raised concerns over the IMF’s tax recommendations, particularly the promotion of value added tax (VAT), which advocacy groups say disproportionately affects low-income households and women.

Roos Saalbrink criticised the logic behind wage cuts in essential sectors.

“Cutting the wages of nurses, teachers and doctors is presented as necessary for priority spending, ignoring that these workers are themselves the priority,” she said.

Similarly, Jennifer Lipenga said the IMF’s tax policies fail to consider gender impacts or align with global commitments such as the Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW).

Calls for Structural Reform

The report concludes that the IMF remains structurally unreformed and “no longer fit for purpose,” urging governments to explore alternative global financial frameworks.

Among its recommendations is the establishment of new multilateral mechanisms, including a United Nations-led tax convention and a sovereign debt framework, to replace what it describes as an outdated global financial system.

The organisations also called for broader debt cancellation measures, noting that many low-income countries now spend more on debt servicing than on healthcare.

Spokespersons for the report’s authors are available for further media engagement through ActionAid’s media office.