Vol. 1, No. 187, 30 December 1997
ONE THIRD OF HUNGARY'S PRISONERS COMPLAIN ABOUT
HUMAN RIGHTS ABUSES. One third out of 700 prisoners
questioned in a survey said they were subject to police
abuses. The results of the poll, conducted by the Hungarian
Helsinki Committee and the Institute of Juridical Politics and
the Constitution, was published on 23 December. The poll
also found that foreign prisoners, gypsies and young
offenders were more often exposed to police violence than
others. The human rights groups also criticized poor
conditions and overcrowding of the prisons. FS
HUNGARY ENDS ANONYMITY FOR AIDS SUFFERERS. A new
law will take effect on 1 January, obliging people tested
HIV-positive to give identification to the health authorities.
The law covers altogether fifty contagious diseases.
According to the World Health Organization, Hungary had
265 cases of full-blown AIDS in September. Human rights
groups and former Health Minister Judit Csehak have
expressed concern that the new law may be
counterproductive and scare people away from AIDS tests,
fearing stigmatization. FS
HUNGARY'S GREENS ADVERTISE FOR ELECTION CANDIDATES.
The Green Party has launched an advertising campaign in
daily newspapers, seeking parliamentary candidates for the
upcoming elections. The Greens, who gained less than one
percent in the 1994 parliamentary elections, are short of
members. Party chairman Zoltan Medvecki told Reuters on
29 December that "We don't think our members are the
wisest people in the country so we would like to give a
chance to the most suitable candidates." FS
1997: Another Busy Year for the IMF in the Post-Communist
by Michael Wyzan
The International Monetary Fund (IMF) continues to
play the dominant role in providing financial support for the
balance of payments of post-communist and developing
countries. The fund has the dual role of providing such
support and of encouraging economic reform by attaching
stringent conditions to its loans.
In 1997 the IMF approved new credits for Albania,
Armenia (actually, the second annual loan under a three-
year facility), Azerbaijan, Bulgaria, Croatia, Estonia, Georgia
(an identical situation to Armenia's), Kyrgyzstan, Latvia,
Macedonia, Mongolia, Romania, Tajikistan, and Ukraine.
Among the transition countries not listed, some -
including Kazakhstan, Lithuania, Moldova, and Russia -
attempted during the year to qualify for the release of
tranches under existing loans. The Visegrad countries have
had sufficiently strong private capital inflows not to rely on
the IMF for balance-of-payments support, although Hungary
was awarded a two-year loan in March 1996, which it has
not drawn upon.
The IMF suspended lending in1995 to Belarus and
Uzbekistan out of dissatisfaction with their weak reform
efforts, in the latter case citing the restrictive foreign
exchange regime introduced that year. Two further striking
cases are Federal Yugoslavia and Turkmenistan. The former
has been under UN sanctions and is not yet a member of the
IMF; the latter is a member, but has not been sufficiently
reformist to quality for support.
Bulgaria and Romania won large new loans in April (in
this endnote, all agreements are dated based on when hey
received approval from the IMF's Executive Board), as new,
reformist governments vowed to put their predecessors'
sluggishness behind them. The Bulgarian loan is supposed to
provide $657 million over 14 months, while the Romanian
one is slated to provide $414 million over 13 months.
Subsequently, the fund pronounced itself satisfied with
Bulgarian economic policy, and released additional loan
tranches in July, August, and December.
Romania's relations with the fund in1997 were
problematic, however. In the summer the IMF criticized the
size of the budget deficit, continuing high inflation, and price
controls on energy and food products. It was especially
concerned about the slow pace of liquidation and
privatization of state enterprises, prompting the government
to announce in August the closure of 17 enterprises. That
move led to the Fund's releasing of the second tranche in
The IMF remains concerned about slow privatization
and high inflation in Romania. However, a privatization
decree issued on 21 December, if passed by parliament in
February, may help convince it to release the next tranche in
Albania received $12 million from the IMF in
November for "emergency post-conflict assistance." In
August, the IMF HAD set as conditions for renewed lending
that the authorities close the remaining pyramid schemes,
privatize or liquidate two of three state banks, reform the
civil service, create an agricultural land market, improve tax
collection, raise tax rates, and cut government spending.
Agreement was held up until November by legal problems
involving the closure of the pyramids. Tajikistan received a
similar, $10 million, loan in December.
At the other end of the spectrum are Estonia and
Latvia, which both received standby loans late in 1997 -
worth $22 million and $45 million, respectively - which they
do not intend at present to draw upon.
Relations between the IMF and Croatia made headlines
in an unusual way in1997. Under pressure from the United
States, the fund in July refused to release a $40 million loan
tranche. The U.S. cited Zagreb's balking at releasing war
criminals to the Hague. Those individuals were apprehended
and dispatched to the Netherlands in October, and the IMF
approved the release of the money, but Croatia then decided
it did not need the funds after all.
Russia and Ukraine, two of the IMF's biggest
borrowers, experienced ups and downs in their relations
with it IN 1997. In October, the fund, citing poor tax
collection, announced that it would not release a $700
million tranche of a loan to Russia until early 1998.
However, an IMF mission in December recommended
releasing it, citing progress in that area.
Ukraine received a one-year, $542 million standby
loan in August. That is not as good news as it seems, since
Kyiv and the IMF had been negotiating over a $2.9 billion,
three-year loan, but in the end the fund decided that reform
progress had been insufficient.
Relations with the IMF mirror the overall direction of
transition economies. Relations remain on track between the fund
and the Transcaucasian states, even though Georgia and Azerbaijan
were slow starters on reform. In contrast, the IMF, citing
problems with privatization, energy pricing, and the budget deficit,
postponed from June until July releasing one loan tranche to
Moldova (an early CIS reformer); it then delayed until early
1998 releasing the next one.
*Michael Wyzan is an economist living in Austria.
Copyright (c) 1997 RFE/RL, Inc.
All rights reserved.