Search Results

This chapter presents an overview of the sovereign-debt initiatives from the last twenty-five years. It examines the programs devised by creditors, namely the World Bank and IMF, during the 1980s and 1990s, that aimed at addressing the mounting problem of developing-country debt. The “austerity” lending of the 1980s and the structural adjustment programs of the 1990s are discussed, and the inherent failings that characterized those efforts, including reduced public investment which has led to economic stagnation, are criticized.

The first section of this chapter examines the political and economic context of change in developing countries: the two themes are the evolution of the international economy, especially since the 1970s, and the political impact of the ending of the cold war. The next section addresses the key issues of liberalization and globalization, which preceded the end of the cold war but are now influenced by that event. The next section identifies the deepening of liberalization and globalization, and the phenomenon of regional integration and asymmetric competition between developed and developing countries. A more detailed discussion of two important expressions of liberalization and globalization follows, in the context of the political implications for developing countries: these are the importance of structural adjustment programmes for the advance of the new market forms and their associated ideology, and the GATT Uruguay Round of trade negotiations. The two final sections of the chapter evaluate the use of political power by developed countries to achieve economic ends, and a concluding section assesses the possible future pattern of interaction between developed and developing countries.

This chapter examines the impact of the structural adjustment programs of the International Monetary Fund (IMF) and the World Bank on poverty reduction. It argues that structural adjustment, measured by the number of adjustment loans from the IMF and World Bank, reduces the sensitivity of poverty reduction to the rate of growth. Economic growth does reduce poverty but there is no evidence for a direct effect of structural adjustment on the average rate of growth. In fact, the poor benefit less from output expansion in countries with many adjustment loans than in countries with few.

Discusses policy change in the midst of markets and non‐market institutions. Accounting prices are particularly difficult to estimate in non‐market institutions because of an absence of market prices to serve as guide. Moreover, changes in public policy (e.g. changes in the structure of taxes and trade) frequently affect the macro‐economy. Involving as they do large changes to an economy, their evaluation requires more complex estimation procedures. Accounting prices don’t suffice. By means of three examples, I offer a sketch of how social cost–benefit analysis is useful for identifying what the evaluator ought to try to measure and why. The first example is a miniature, involving communal management of irrigation systems in Nepal; the latter two are altogethergrander, illustrating some of the environmental implications for poor countries of structural adjustment programmes and trade liberalization.

We consider the impact of Fund-supported programs in fragile and conflict-affected states (FCS) on aid flows and what factors determine program success. Using several indicators of fragility in a multivariate setting, we find that the catalytic role of IMF engagement on aid is significant in general and particularly so in fragile states. There is clear evidence that risks are more elevated in FCS due to conflict and political instability. Probit analysis for metrics of program success indicates that programs in FCS have a significantly higher probability of non-completion than non-FCS. We find a strong negative effect of high public debt on program completion. Usage of prior actions is associated with weaker program performance, suggesting that their use occurs in situations that are perceived as more risky. We recommend a greater focus on the drivers of conflict and instability in FCS and consideration of program measures that contribute to better economic outcomes.

This chapter focuses on poverty reduction strategy papers (PRSPs). PRSPs were introduced by the World Bank and International Monetary Fund (IMF) in September 1999 as a new requirement for countries to receive concessional funding and debt relief. PRSPs are national planning frameworks, and describe a country's macroeconomic, structural, and social policies and programs to promote growth and reduce poverty, as well as associated external financing needs. PRSPs may signal an improvement on structural adjustment programs (SAPs) but still have some distance to go in recognizing and addressing issues such as equity and gender disparities. Although it is too soon to appraise the outcomes of PRSPs, some skepticism has been voiced in some quarters that they are SAPs by another name.

This chapter traces the shift in the pharmaceutical markets in Kenya, Tanzania, and Uganda from markets dominated by originator (brand-name) drugs produced by western companies to markets dominated by generic drugs produced in the global South, most prominently, in India. The rise of Indian exports was not simply a consequence of conditions in India, as it is often suggested. In East Africa, it was also a consequence of market liberalization imposed through Structural Adjustment Programs (SAPs) on the three countries in the 1980s and 1990s. Specifically, the removal of foreign exchange restrictions—combined with inadequate regulation of the pharmaceutical market—allowed an unmonitored entry of drugs into the private market. The chapter then describes the ongoing efforts by multinational pharmaceutical companies to slow down that shift—especially by strengthening intellectual property rights. It also examines why reports on the prevalence of Chinese drugs in East Africa are greatly exaggerated.

This chapter focuses on population policy in Nigeria, beginning with the first Nigerian national population policy, introduced in 1988 as the “Four is Enough” campaign, and ending with the 2012 London Summit on Family Planning initiative. While the 1988 policy led to increased availability of contraceptives, women’s groups complained about the policy’s focus on women’s fertility and its failure to incorporate reproductive health into its purview. Others criticized the emphasis on contraceptives when free primary healthcare was curtailed as part of the national structural adjustment program in 1986. This disconnect between the government population policy and local concerns has contributed to continuing high levels of fertility. Without sufficient health services to reduce maternal and infant mortality or government provision of electricity and water to improve living standards, population policies remain irrelevant when having many children is a means of offsetting the uncertainties of everyday life in Nigeria.

This chapter examines the concept of mobility that has animated the quest for survival in the most difficult times in Zimbabwe. In 1980 the government of Robert Mugabe's party ZANU (PF) embarked on a robust Socialism-anchored policy of state-subsidized free education, free health, social welfare, and road construction. Ten years later, Mugabe agreed to the International Monetary Fund (IMF) and World Bank's economic structural adjustment program (ESAP) that removed most of the social responsibilities of the government to the people. One of the most remarkable things that happened in the period during and after ESAP was how people returned to modes of innovation, creativity, and entrepreneurship—criminalized under colonialism—to eke out survival in an increasingly harsh economic environment. This chapter considers the different transient workspaces that animate creativities and life amid the economic crisis in Zimbabwe and how the de- or re-spiritualized aspects of such creativities persist, sometimes in the original essence, other times in modified form.

Many of the countries that are now among the poorest are stuck in a syndrome of fragility. Social, political, and economic characteristics interact in a dysfunctional, but locally stable, equilibrium. The transition from this trap requires highly distinctive International Financial Institution (IFI) policies. For much of the time, since the society is trapped by its own internal pressures, no IFI action can ignite transformation. But fragility periodically triggers potential change and during these “pivotal moments” IFI help can be decisive. However, because the situation is highly constrained, normal programs are liable to be ineffective. The path out of fragility must be set by the government and kept sufficiently simple that success gradually cumulates from seemingly modest early steps. The sinews of state effectiveness can be built, but the process of building them is analogous to erecting scaffolding: it cannot be understood by studying states that have long been in a well-functioning equilibrium.

This chapter presents an assessment of the IMF’s role in countries in fragile and conflict-affected situations, drawing primarily on the findings of a recent evaluation report by the Independent Evaluation Office. The IMF is widely acknowledged to have made significant contributions to helping build core economic policy institutions, achieve macroeconomic stability, and promote macro-critical reforms in these countries. Quantitative analyses based on a “dynamic” list of fragile states suggest that the IMF’s program engagement has been positively associated with increased tax revenue, higher GDP growth, and greater official aid inflows. Even so, the IMF’s business model, focused on short-term macroeconomic stabilization, has a tendency to treat fragile states like any other country and does not always fit well with their long-term sustained development needs. The chapter argues that the IMF’s support for fragile states has yet to achieve its full potential and identifies areas where effectiveness can be strengthened.

While corruption exists in all polities, the form it takes, its extent, and its political and socio-economic functions vary enormously across time and place. This chapter takes a wide and close look at corruption. As wide, the chapter locates corruption within the “gray zones” between the legal and the illegal, and shows how corruption is shaped by the complex and shifting interactions between state and nonstate actors in mobile settings. The chapter challenges the essentialism, cultural determinism, and functionalist explanation that characterizes and constrains dominant approaches to corruption in contemporary Africa, showing how they tend to obscure corruption’s social, historical, and moral underpinnings and logics. As close, the chapter examines elite corruption and profiteering in Nigeria since independence in October 1960, especially the systematic plundering of Nigeria’s oil-dominated national economy and the consequent emergence of a crisis of values in everyday, urban life. The analysis in this chapter extends to the checkered story of post-1999 institutionalist efforts to combat political corruption.

This chapter focuses on the origins and changing dynamics of the dreaded National Union of Road Transport Workers (NURTW) tax collectors—the mafia-like motor park touts (agberos)—and the intimidating and violent tactics and strategies they deploy to extort illegal fees of all sorts from informal transport operators in Lagos. Situating the emergence and reach of agberos within the widespread crisis of the structural adjustment program (SAP) introduced in 1986 in Nigeria, this chapter directly relates the transformation of agberos (from callers of passengers to violent extortionists) to their adverse incorporation into the NURTW as tax collectors and political thugs, which altered their initial role in the road transport sector. The chapter argues that efforts by the Lagos State Government to rid the roads of agberos since 1999 is inspired by its contested neoliberal urban reform project which responds to the logic of the market rather than the needs of the poor. Yet the role of “big politics” (in form of the unholy alliance between the NURTW and the state) helps explain the botched attempts to remove agberos from the roads.