Communications News: Action Aid presses finance institutions over conditional aid

Action Aid is lobbying the World Bank and the International Monetary Fund to review their common practice of tying loans and aid to the privatisation of utilities.

A report launched by the charity last week found that both organisations are still pressing poor countries into privatising water and energy services by giving conditional aid.

Money Talks is being sent to key personnel at both institutions. It uses research in India, Ghana and Uganda to explode the myth that the privatisation of utilities benefits the poor. It says that in Ghana, urban water systems are collapsing after a decade of under-investment and political wrangling over privatisation, while the World Bank continues to press for water privatisation in Uganda.

"They claim to support democracy, so they should be careful not to use their huge financial power in undemocratic ways," said Patrick Watt, one of the report's authors.

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