Just recently in Ecuador, large scale, indigenous-lead protests broke out against a controversial loan from the IMF, which has required the Moreno government implement widespread austerity and a repeal of a fuel subsidy that largely benefitted the poor, which represent a large sector of Ecuadorian society. This was seen by elites in the country as well as the US and international markets as a positive, as it would “balance the budget” of the country through cutting spending, and allowing the public sector to be privatized through a process called “structural adjustment,” which is pushed by the IMF as a condition of receiving loans.
These “fiscally responsible” neoliberal policies are completely ignorant of the reality on the ground, however. The people of Ecuador don’t see it as a technocratic method of balancing budgets, they see it as an assault on their livelihoods. Poverty is rampant in the country and many cannot afford the newly inflated prices, which have increased by as much as 120%.
Ecuador is a prime example of neoliberalism at its worst. It fails to understand, or perhaps willfully ignores the fact that policies which benefit MNCs and private capital do not necessarily benefit that populace as a whole.
Oftentimes these policies result in the sale of public resources to the highest bidder and the destruction of public services, leaving the local population with no recourse but to either accept living in poverty with no escape, or resist, which can be an immense risk. The United States has brutally overthrown many left-wing and populist governments in the region which have decided to resist neoliberal policies, and others have become increasingly authoritarian, such as Venezuela.
The IMF and international organizations should begin to consider public opinion in developing countries, and make “structural adjustments” to policy to better suit the economies and democratic will of the people. Otherwise, these developing nations will continue to resist these policies, resulting in untold destruction. Ultimately many of these resistance movements will succeed without policy change by these liberal institutions, which could see diminished relevance in the near future in many countries.