The International Monetary Fund's Standby Arrangements with Portugal. An Ex-Ante Application of the Washington Consensus

At two different moments (1978-1979 and 1983-1985), Portugal had to call upon the International Monetary Fund (IMF) for financial assistance in order to resolve serious balance of payment crises. In both cases, the terms for the implementation of IMF conditionality were agreed before the so-called Washington Consensus (WC) was established in 1989. The paper examines to what extent the Portuguese experience under the stand-by arrangements agreed with the IMF would later be embodied in the WC strong conditionality practices. Several similarities were apparent, since many of the WC prescriptions were basically influenced by IMF conditionality practices, which had been adapted during the 1980s to include further structural measures. Some significant differences can also be noticed: as the theoretical and ideological background of the we would only be crystallized in the second half of the 1980s, the we basically focused on Latin American developing economies, while Portugal, a European high-medium income country, had been implementing major institutional reforms since 1977, in order to meet the terms required to become an EEC member.