A Right by Any Other Name: The Evasive Engagement of International Financial Institutions with Human Rights

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I. INTRODUCTION

The actions of international financial institutions (IFIs) - the International Monetary Fund (IMF), the World Bank and its constituent agencies, and regional development banks - undeniably have a profound effect on human rights in both positive and negative ways.

Development projects sponsored by these institutions can bring improved infrastructure, employment, and sustained prosperity, often on a very large scale, to large numbers of people. These benefits often accelerate the realization of economic, social, and cultural rights, such as the rights to work, a reasonable standard of living, health, and education. In many cases, however, these projects negatively affect the rights of local people.

Infrastructure and mining projects frequendy require relocation of communities from the development site. Relocation impacts the right to housing, and depending upon the conditions of the new location, the rights to work, food, and enjoyment of culture, among others. A new development that causes pollution, particularly to waterways, may infringe upon the rights to water, health, food, and perhaps even life.

Loans and financial assistance packages, and the associated involvement of IFIs in restructuring economic policies in recipient countries, can have a positive impact on human rights in those countries. As discussed in Part V below, the increased focus of development programs on poverty alleviation has a clear synergy with the realization of human rights. To the extent that macroeconomic restructuring succeeds in preventing future economic crises in the relevant country,1 human rights interests are served by preventing a situation in which the state simply cannot afford to implement resource-intensive programs such as the provision of health care, education, and social security. The same positive effect flows from the debt relief programs IFIs promote, which maximize the resources available to the state for the fulfillment of human rights. When macroeconomic reforms include significant cuts to social spending, privatization of essential services, labor market reforms, or other measures that result in loss of livelihood or access to services for certain groups or individuals, however, their consequences can include a diminution of human rights unless appropriate safeguards are put in place.

Other IFI programs also have the potential to contribute to the realization of human rights, such as those promoting good governance, judicial independence, and anticorruption measures. These programs can support human rights both direcdy, by promoting the right to a fair trial, for example, and indirectiy, by promoting transparency and removing conditions diat allow oppression to flourish.

The goals and programmatic focus of IFIs have become more conducive to the promotion of human rights goals over time, particularly in relation to poverty alleviation. Calls for accountability for human rights violations also have become more frequent and attract increasing support. Meanwhile, the IFIs' attitudes toward their role in human rights have evolved significandy. For several decades, IFIs insisted they were purely economic institutions that had nothing to do with human rights, and indeed expressly were prohibited from addressing human rights concerns. Today, that position has dissipated, although the attitude that has replaced it varies by the institution and program in question.

The World Bank in particular now acknowledges - one might say even extols - its positive contribution to human rights. It also takes note of its potentially negative impact on human rights, and many of its policies can be characterized as human rights safeguards or safety nets. The IFIs' use of poverty and social impact analyses demonstrates their consciousness of the potential effects of their programs on human rights and a determination to minimize any harm from the outset. In their policy documents and everyday work, IFIs generally do not use the language of human rights law. …