ActionAid Federation has expressed concern over the International Monetary Fund’s (IMF) debt sustainability assessments, saying they continue to prioritise governments’ loan repayment capacity at the expense of investments in essential public services.
The Federation said the IMF’s approach was undermining efforts to reduce inequality and achieve sustainable development in borrowing countries, including Ghana, particularly in critical sectors such as health and education.
The concerns are contained in the Federation’s latest report titled: “Still Cooking with a Failed Recipe: A Review of IMF Country Advice on Social Spending, Public Services, Debt, Tax and Gender Equality.”
The report examined the impact of IMF policy advice on borrowing countries.
A copy of the report, made available to the Ghana News Agency in Tamale, indicated that despite the IMF’s stated commitment to protecting vulnerable populations and promoting sustainable development, its country-level policy advice continued to place greater emphasis on fiscal consolidation and debt repayment than on social investment.
The report reviewed 29 IMF documents issued between February 2022 and February 2025 across 11 countries – Ghana, Brazil, Kenya, Malawi, Nepal, Nigeria, Senegal, Uganda, the United Kingdom, Zambia and Zimbabwe.
The documents examined included Article IV consultation reports, lending programme documents and technical assistance reports.
The review of the report revealed a significant gap between the IMF’s stated commitments and the policy recommendations it provided to member countries.
It said IMF debt sustainability assessments remained largely focused on governments’ capacity to service debt, with limited consideration for social spending needs, human rights obligations and long-term development priorities.
It observed that none of the IMF documents reviewed for the eight African countries compared external debt repayments with spending on health and education, even though debt servicing exceeded health expenditure in seven of those countries.
It said IMF-supported debt restructuring had generally failed to create sufficient fiscal space for governments to increase investments in health, education and other critical public services.
Citing available research, the report said countries that were advised to continue servicing debts in full recorded an average 18 per cent reduction in health expenditure and a 16 per cent decline in education spending.
It said the findings came at a time when 54 countries were facing debt crises, while an estimated 3.3 billion people lived in countries spending more on debt servicing than on health and education.
It called on governments to adopt progressive and gender-responsive tax reforms capable of increasing tax-to-GDP ratios by at least five percentage points by 2030 to strengthen domestic resource mobilisation and finance quality public services.
It also urged governments to review policies that facilitated capital outflows and supported negotiations towards a United Nations Framework Convention on International Tax Cooperation to promote fairer and more equitable global tax systems.
It further recommended that IMF loan agreements, technical assistance arrangements and other international economic agreements be subjected to parliamentary scrutiny and broad public consultation to enhance transparency, accountability and safeguard national interests.
