Conditionality, coercion and other forms of power: International financial institutions in the Pacific

Research on conditionality has cast doubt on its effectiveness. Nevertheless, international financial institutions have continued to apply policy conditions to loans to developing country governments. The article aims to contribute to the current debate about conditionality in two ways. Empirically, it introduces recent evidence from countries and institutions not included in earlier studies (the World Bank and the International Monetary Fund in Papua New Guinea, and the Asian Development Bank in the South Pacific). Conceptually, it introduces arguments from political science to extend our understanding of the power relationships involved. Some conditions have clearly been applied coercively, particularly on 'Green' issues. Donors have also controlled the agenda of negotiations. But more productive and disciplinary forms of power are shown to be at work in conditionality, as in other forms of aid.