IMF Accused Of Triggering Niger Famine

A while back, in my review of the San Francisco Mime Troupe's "Doing Good", I confessed I could stand to learn a lot more about the World Bank and IMF. I haven't had much free time lately to follow up, but I did catch an article in TIME Magazine repeating an accusation that misguided IMF policies triggered the current famine in Niger.

It looks like the accusation was first published in an August 1st article in The Independent. The online version of The Independent requires a subscription, but the article has been repeated on several websites:

"IMF and EU are blamed for starvation in Niger"

"Ms. Sekkenes [the head of a medical aid group] said the International Monetary Fund and the European Union had pressed Niger too hard to implement a structural adjustment programme. "'No sooner had the government been re-elected [this year] than it was obliged to introduce 19 per cent VAT on basic foodstuffs. At the same time, as part of the policy, emergency grain reserves were abolished.'"

A spokesman defended the IMF in a letter to The Independent:

"The IMF has never supported or encouraged the abolition of government grain reserves."

Niger’s government and IMF staff did consider “steps to expand agricultural production” and expand the VAT to include milk, sugar, and flour, he acknowledged. “IMF staff specifically recommended that a poverty-impact assessment of the proposed measures be carried out. At any rate, the VAT extension was soon rescinded because of public protests and could have had little effect on the crisis,” he said.

I skimmed through some of the IMF documents on Niger (there's a lot there) and couldn't find any smoking gun where the IMF explicitly demanded a tax on food or a reduction of grain reserves. The documents do show the IMF requested that the Niger government modernize its tax collection system and get tougher on collecting taxes.

The Niger government may have gone beyond the IMF's recommendations, coming up with the 19-percent tax on food on its own. Still it is reprehensible that the IMF staff would even consider taxing staple foods. Taxing basic groceries is just plain wrong in my book. I'm sure most people would agree.

If anybody out there can point me to more information on this topic, I'd appreciate it.