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conditionality


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The practice by which the International Monetary Fund (IMF) makes its loans conditional on the borrowing country adopting an approved adjustment programme or policy package. Conditionality is justified on the argument that the IMF has limited total resources, and that there is no point in using them in cases when a country's trade or macroeconomic policies make it unlikely that their balance-of-payments problems can be solved even with an IMF loan.

Subjects: Social sciencesEconomics


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