International Financial Institutions give member states financial support for development in the form of loans. These loans are attached to conditionality requiring recipient states to undertake various reforms, including labour market reforms.  In addition, the policy advice, and technical support these institutions provide to the members have a bearing on labour policies in member countries.

Legal implications of loaning activities

The dissertation investigates the legal implications of the loaning activities of six International Financial Institutions, namely the World Bank, the International Monetary Fund (IMF), the European Bank for Reconstruction and Development (EBRD), the African Development Bank (AfDB), the Asian Development Bank (ADB), and the Inter-American Development Bank (IDB).

In accordance with the neoliberal policies of the World Bank and the IMF, freedom of association and collective bargaining are often considered obstacles to flexibility of the labour market and thus obstacles to economic development. These labour rights are therefore seen as instrumental values and are thus promoted only in cases where these IFI’s deem the rights necessary to enhance economic growth.

Instrumentalist approach to freedom of association and collective bargaining

“The World Bank and the IMF and their economic rationale have an instrumentalist approach to freedom of association and collective bargaining, where these rights are taken into consideration if and when they have an impact on the success of a program or project, like a variable in an equation, rather than a goal in itself”, says Mpoki Mwakagali, the author of the dissertation.

On the other hand, the EBRD hold these rights, as intrinsic values and therefore they tend to play a positive role in the application of freedom of association and collective bargaining. Finally the IDB the ADB and the AfDB are more in the grey area in respect of their activities actual effect on freedom of association and collective bargaining, despite the AfDB having incorporated these labour standards in its policies.

Compatibility with principles of international law

The dissertation also explores whether the conditionality in the loaning activities of the IFI’s is compatible with the principles of international law. The findings are that, even though the IFIs are subjects of International law, their human rights obligations are not very clear.

“Their functional immunity should not be absolute; if an IFI influences a recipient state to violate its human rights obligations, it should be possible to hold it accountable”, says Mpoki Mwakagali.

Finally, the dissertation discusses how IFI’s can play an enhanced role in the promotion and implementation of freedom of association and collective bargaining. Mpoki Mwakagali proposes that the IFIs should embrace a more holistic and sustainable concept of development which acknowledges and considers the correlation between economic growth and social and political values where human rights is not an option or just a means-the human rights-based approach to development.

Mpoki Mwakagali defended her thesis "International Financial Institutions and Labour Standards: A Legal Study of the Role of These Institutions in the Promotion and Implementation of Freedom of Association and Collective Bargaining." 27 April.

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