IFI Conditionality Matures and Perhaps Withers: A View From Uganda

 

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There was a time when  universal convergence of core principles was within sight.  A complex of international institutions, interlinked with a tightening network of global trade, all tied together by a rising cadre of functionally differentiated techno-bureaucrats embedded within the institutional organs of critical institutions in public and private life appeared to make the forward movement along the Globalization Path unavoidable. A significant element in this convergence  movement was the emphasis on capacity building, and guidance, by the representatives of global convergence especially within developing states. Capacity building  had a social and a financial dimension.  It required resources, and it required training--that is the naturalization of the outlooks and cognitive baselines necessary to the cultivation of ideological solitary necessary to project capacity as a normative as well as a technical object. 

IFIs became an important instrument in this effort. And a fundamental element of convergence capacity building was an alignment to what IFI's do--lend money and protect their interests in the financial capacity of the borrower and the fulfillment of the purposes toward which funds were made available.  IFI conditionality became a "thing", and then it acquired breadth and depth, and then it also acquired a smoldering resentment among borrowers who began t find it hard to distinguish between IFI conditionality guidance and control with that of former hierarchs. Resistance resulted--and not just the usual heroic performance of the3 theater of anti-domination mass agitators. That resistance acquired more than rhetorical utility as the conceptual structs of the old system of convergence struts gave way ironically because of the temporal convergence of a number of factots that had been simmering for a while, including but not limited to cultural revolution in OECD States, a resurgence of more traditional sovereignty-nationalism in the Global South, and the rise of alternative universal systems.

It is on this context, then, that one might begin to see cracks in the authority of conditionality, and the power of IFIs to more or less effectively use them to achieve their goals. Among these cracks, and one that ought to matter to elites in the liberal democratic center whose views tend to drive these things,  is Uganda.

On June 5, 2025, the World Bank resumed lending to Uganda, ending a two year suspension triggered by the Anti-Homosexuality Act (AHA) of 2023. The Bank cited "mitigation measures"  intended to protect marginalised groups. Ironically, Uganda has not repealed AHA, and the appeal against it remains stalled. This isn't progress; it's surrender in slow motion. The World Bank blinked, revealing the crumbling foundation of conditionality, the once powerful notion that global financial institutions could influence domestic policy through aid. . . .  (Mark Umona, Uganda, World Bank and the quiet collapse of conditionality, Monitor (Uganda) 23 June 2025). 

The full reporting may be accessed here; the future of conditionality remains to be seen. Perhaps conditionality shopping, rather than the end of conditionality, will become normalized--as AIIB and IMF/World Bank diverge, at least to some extent, and new IFIs or IFI substitutes with a "mission" emerge. Very grateful to my former student Jonathan Kiwana for bringing this to my attention.