The International Monetary Fund made
incorrect forecasts about Indonesia, Korea and Brazil and made
errors in handling those countries’ economic crises, an
independent report from the IMF said.
The report, by the IMF’s independent evaluation
office, also blamed the fund’s major shareholders, which include
the U.S., for playing too large a role in dictating IMF policies.
Shareholders failed to initially authorize enough money to offset
the Korean crisis and pushed in Indonesia for an overhaul of the
judiciary that took the focus away from weakness in the banking
industry, the report said.
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In 1998, the Indonesian economy shrank 13 percent after
investors pulled out of the nation’s capital markets. That same
year, Korea’s economy shrank 6.7 percent, compared with a positive
forecast by the IMF, the report said. In 1999, Brazil’s economy
grew 0.8 percent, although the fund had forecast a contraction.
