In December, the IMF’s Independent Evaluation Office (IEO) published its evaluation of the Fund’s Exceptional Access Policy (EAP). Established in 2002, the EAP was intended to impose stricter safeguards for countries seeking IMF loans beyond normal limits – standard borrowing caps based on a country’s IMF quota share. To qualify, countries must meet four criteria, including experiencing severe balance of payments pressures and demonstrating debt sustainability.
Political pressures and lack of even-handedness
The IEO evaluation raised significant concerns, noting that the EAP “has not provided a substantively higher standard for EA programs compared with NA [normal access] programs.” The Fund’s ad-hoc approach, “often in response to high-profile cases, created a perception of lack of evenhandedness,” exposing the IMF to “political pressure to provide EA even when the prospects for success were poor or the sovereign debt burden likely unsustainable, and increase risks for the Fund’s financial position.”
A 2020 study by US-based Boston University’s Global Development Policy Center found countries with greater voting power at the IMF, stronger trade ties with Western Europe, or alignment with Western Europe in the United Nations General Assembly tended to receive less stringent fiscal consolidation conditions in IMF programmes, overall.
Despite the fact that Argentina didn't comply with the conditions, the IMF approved the EA and continued disbursements until the government lost the 2019 electionFrancisco J. Cantamutto, Universidad Nacional del Sur, Argentina
Worsening debt risks and economic dependence
The IEO highlighted that over-optimism in debt sustainability analyses (DSAs) and macroeconomic projections was more pronounced in EAP programmes, whereby “Fund access effectively becomes a substitute for necessary restructuring.” Former IMF General Counsel Sean Hagan argued in a January 2025 Financial Times article that, “Private creditors are fearful of being subordinated to the IMF in the event of a future – and potentially very likely – debt restructuring.” The IEO stated that EAP was “generally ineffective in catalyzing private capital inflows, and they rarely involved debt restructuring.”
The IMF’s $57 billion loan to Argentina in 2018, the largest in its history, exemplifies these concerns. Despite doubts over Argentina’s debt sustainability, the IMF proceeded with lending under the EAP, with the Fund admitting in its ex-post evaluation it was “well understood to be high-risk.” The IEO report noted that DSAs are “confusing, unduly sensitive to assumptions, and too dependent on judgment,” risking the Fund’s credibility. Political pressure also shaped the decision – Argentina’s government said the loan backed former President Mauricio Macri’s re-election, a view shared by former US IMF Director Claver-Carone, who saw it as key to US influence in the region (see Observer Spring 2022).
Francisco J. Cantamutto, economist at Universidad Nacional del Sur and National Council for Scientific and Technical Research in Argentina argues, “Despite the fact that Argentina didn’t comply with the conditions, and this was warned by civil society and opposition congressmen, the IMF approved the EA and continued disbursements until the government lost the 2019 election. During this period, the Fund financed a capital outflow of $45.1 billion, against its own constitutive agreement. Yet, to this day, the Fund continues to impose heavy surcharges for this EA.”
The IEO made five recommendations to the EAP, including conducting regular reviews of access limits to assess whether they adequately serve members’ balance of payment needs, and introducing an exceptional clause for situations where EA programmes do not meet EAP criteria – though this risks creating a loophole for politically motivated access to EA, as noted by Sean Hagan. In her formal response, IMF Managing Director Kristalina Georgieva said that a Fund review of the rules governing EA was “needed to ensure that the policy remains fit for purpose in an evolving global context.”
