Private capital is double-edged. A loan, governmental or institutional, has one advantage. It can be renegotiated, providing breathing space for the emerging country. Foreign investors can take their money out, without notice or recourse. Many view this as unacceptable.
Sovereignty is threatened.
National governments can no longer be sure they will always have supreme and exclusive control over their own currency, policies and domestic financial markets. The Asian financial crisis provides an example. Organizations, like the IMF, exerted heavy handed influence over monetary and fiscal policies in several countries during 1997-99. In a sense, by detaching financial governance from government, the IMF brought about a new financial order. They also enraged several governments, who balked at the obligation to appease outsiders.