Resisting NGOs: How Argentina Paves the Way
The role of non-state actors such as the World Bank, World Trade Organization, and the International Monetary Fund in the political efficacy of the state is complex to understand.
These organizations in the eyes of developed countries are there to provide monetary support to developing countries struggling with debt and infrastructure issues. Countries such as Argentina and Kosovo could use additional money to help their countries, so having an outside organization offer it’s fiduciary support is an attractive offer. However, this support is not without costs. Support offered by non-state actors is given in exchange for leverage. Organizations like the World Bank will provide loans to help as long as they have leverage in the country’s political, social, and economic decision making. Once you have the help from these organizations, the political spheres of these developing countries now have an additional stakeholder to consider, and this stakeholder they will expect their loans to be paid back in the future.
Because of the control non-state actors can have over a country once their monetary support is given, many countries are resisting their influence and developing ways to navigate a disruption to their system of deposits and withdrawals. John Glenn in his essay Welfare Spending in an Era of Globalization: The North — South Divide, says that “the ability [of non-state actors] to ‘vote with their feet’ by moving their capital to those states with the most favourable economic environments furnishes them with the potential to exert influence on the policies of states.”
Greece’s financial crisis is a great example of why countries might resist the help and guidance of NGOs. The IMF alongside two European NGOs gave their economic support, but it came with conditions according to a recent New York Times article: “Lenders imposed harsh austerity terms, requiring deep budget cuts and steep tax increases. They also required Greece to overhaul its economy by streamlining the government, ending tax evasion and making Greece an easier place to do business.” The crisis in Greece remains stagnant and ever present.
In 2003, Argentina decided to not buckle down under the IMF’s pressure. Instead of enforcing their list of conditions, they defaulted, making them the first country non-bankrupt country to default. Their decision forced the wallet of the IMF to “roll over its debt.” Since this, Argentina has experienced prosperity and growth in their economy by following the beat of their own drum. Argentina paved the way for countries like Russia and Venezuela to also resist the harsh stipulations of the IMF and find new opportunities for revenue and growth showing that NGOs aren’t the only option to turn to when handling financial crisis.
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