IFIs must respect human rights

2 November 2001

The World Bank and the IMF are bound by obligations enshrined in international human rights covenants, and must incorporate human rights considerations in the formulation and review of their Poverty Reduction Strategy Papers (PRSPs). This was asserted by the UN Sub-Commission on the Promotion and Protection of Human Rights at the conclusion of its 25th meeting.

The resolution on Globalisation and its Impact on the Full Enjoyment of All Human Rights reaffirmed the importance and relevance of human rights obligations in international trade, investment and finance and urged governments and international economic policy forums to respect human rights in their policymaking.

The Sub-Commission, an advisory body to the UN Commission on Human Rights, recommended that governments engaged in PRSP preparation incorporate references to human rights and ensure the realisation of human rights objectives set in the PRSPs.

During the deliberations of the Sub-Commission, the IMF had claimed that it did not have to abide by human rights standards. Grant Taplin, assistant director of the Fund’s Geneva office had told the committee of 26 jurists that the IMF did not have a mandate to promote human rights nor is it bound by “various human rights declarations and conventions”. Taplin added that “human rights were not mentioned in the Articles of Agreement”.

Conclusions of the Sub-Commission were strongly influenced by a report by UN Special Rapporteurs Joseph Oloka-Onyango and Deepika Udagama which criticised the Bank and Fund’s human rights record. The Onyango-Udagama report argued that the critical role played by the Bank and Fund in shaping the global economy has had significant influence on human rights in the countries affected by their policies.

In particular, the report noted the ineffectiveness of the HIPC and PRSP strategies in alleviating poverty and pointed out that the lack of borrower country participation in both processes amounted to a breach of human rights of self-determination and public participation. “Under the PRGF, it is still the staff of the Fund and the Bank who retain the authority to decide whether the conditions are being met … effectively negating the claims of local ownership and participation,” said the report.

The report also criticised the Bank and Fund’s emphasis on free market reforms and conditionalities, saying that it deprived communities of the right to health, education and basic welfare. It called for a restatement of the human rights obligations of these institutions, requiring them to adhere to the UN Declaration on the Right to Development asserting that all human rights must be recognised and protected during the process of development.

The report challenged the conventional notion that international law, including human rights law, governs only states and not multilateral entities. It also added that multilateral organisations, aside from breaching their own obligations, could also undermine or usurp states’ efforts in adhering to theirs through conditionality requirements. “While it is true that such organisations are essentially made up of states, such a supposition does not address the relations of power, resources and inequality that sates are confronted with in the context of their operations and policy formulation,” the report concluded.

NGOs have welcomed the Sub-Commission’s resolution. A joint statement by the Lutheran World Foundation, the World Organisation against Torture and the International NGO Committee for Human Rights in Trade and Investment said the resolution sent an important signal and clear message to international economic policy fora to take human rights seriously when formulating their policies.

Sub-Commission on Human Rights Resolution 2001/5 and Progress report by J Oloka-Onyango and D Udagama, both at UN Sub-Commission on Human Rights website (To find documents, click on ‘Sub-Commission on Promotion and Protection of Human Rights’. When the page is displayed, click on ’53rd Session’. When this page is displayed, click on ‘Report’ for the progress report and ‘Resolution’ for the resolution)

For a draft report on the compliance of the World Bank’s policies on indigenous peoples with human rights principles, see Universal Rights or a Universe unto Itself ? Indigenous Peoples’ Human Rights and the World Bank’s Draft Operational Policy 4.10 on Indigenous Peoples