inate debt and maintain sustainable economic development. However, any number of criticisms have been levied against these institutions by analysts who believe that the IMF and the World Bank actually serve the interests of their controlling members and not the interests of poor nations or debtor nations. Calomiris (2000), for example, contends that both agencies have a poor record of sponsoring successful programs, whether these programs focus on development or debt relief. Calomiris (2000) also maintains that the ineffectiveness of the IMF is an artifact of its crisis lending mechanism, which is not designed to fulfill the role of providing effective liquidity assistance.
All that IMF and development bank lending accomplish is to transfer resources to debtor countries during severe economic crises. These transfers do not appear to improve securities markets or spur growth, but rather to facilitate bailouts of insolvent domestic banking and business entities (Calomiris, 2000).
Guttal (2000) claims that experience over the last 40 years
...