The Audio Long Read From the archive: is the IMF fit for purpose?
Dec 10, 2025
Explore the complexities of the IMF's role in today's debt crisis as Jamie Martin highlights Pakistan's struggles with bailout conditions. Delve into how the IMF evolved from its non-interventionist origins to wielding tremendous power, especially during the 1990s. Uncover the backlash it faced during the Asian financial crisis and the geopolitical implications of dollar dominance. As China rises as a less conditional lender, questions arise about the IMF's necessary reforms and its potential to provide unconditional support.
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When Climate Disaster Meets Debt
- Pakistan faced catastrophic floods while negotiating an IMF bailout that required painful austerity measures.
- Jamie Martin describes how Pakistan risked default without a $1.17bn IMF deal tied to subsidy cuts.
Default Preceded A Political Upheaval
- Sri Lanka defaulted after resisting IMF reforms and suffered a popular uprising that toppled its government.
- Jamie Martin uses Sri Lanka to show the political risks of delaying IMF engagement.
Multiple Shocks Created Debt Vulnerability
- COVID-19, the Ukraine war, and US rate hikes combined to threaten a major global debt crisis.
- Jamie Martin links dollar strength and capital flight to rising borrowing costs for dollar debtors.