Title: 2015 World Bank Group / International Monetary Fund Spring Meetings. With the waning of North-South private capital flows, indebted countries became increasingly dependent on the IFIs, which conditioned new lending on the implementation of SAPs. Kritisiert werden die Strukturanpassungsprogramme auch von dem US-amerikanischen Wirtschaftswissenschaftler und Nobelpreisträger Joseph E. Stiglitz. The lender services the loan based on the assumption that certain fiscal policies will take place within the borrow- country. Likewise their late concern for good governance only surfaces after successive SAPs have already dismantled many important state institutions and continue to undermine the ability of governments to exercise control over national economic development. The country in need (the borrower) approaches the IMF and World Bank (the lenders) for a loan. The U.S. plays a fundamental role in designing and financing structural adjustment programs of the main IFIs, namely the World Bank and the International Monetary Fund (IMF), as well as those of the regional multilateral banks such as the Inter-American Development Bank (IDB). Page 4) notes that a UN survey of 12 African structural adjustment programmes (SAPs) found little improvement in export earnings following such devaluation and that, since the demand for most of Africa's exports are inelastic - price fluctuations change demand very little devaluation of African currencies has led to steep declines in export revenues. Immediate debt relief for impoverished countries should be a priority for the U.S. and the IFIs. They generally entail severe reductions in government spending and employment, higher interest rates, currency devaluation, lower real wages, sale of government enterprises, reduced tariffs, and liberalization of foreign investment regulations. What are Structural Adjustment Programmes (SAPs)? " It is most likely that the countries in which SAPs are implemented differ in terms of their economies and pre-program conditions from non-program countries but also from each other. Economic Structural Adjustment Programs (ESAP), Paper 5 Zimbabwe History Advanced level. The debt crisis, which reached crisis proportions by 1982, gave the IFIs the leverage needed to impose SAPs on the debt-ridden countries of the South. Diese Wegbereiter zur von Weltbank, WHO und IWF verlangten Good Governance nötigten bittstellenden Staaten nicht selten einige ihrer Souveränitätsrechte ab. The SAPs are supposed to allow the economies of the developing countries to become more market oriented. Since 1983, Ghana has been undergoing World Bank and International Monetary Fund (IMF) sponsored Structural Adjustment Programs (SAPs). The economic policies dictated by the IFIs and Washington have greatly facilitated the process of global economic integration. Even when a SAP-directed economy is growing, it is generally failing to create employment and generate the revenues needed to pay for the unregulated influx of foreign imports. Good governance measures are now a criteria for the IFIs’ stamp of approval. Ekei Etim (op. Jason Oringer, Carol Welch, The policies are designed to tackle the root cause of the problem and provide a framework for long term development and long term growth. The objective of social investment funds is to provide temporary relief and stave off political unrest until the benefits of neoliberal reform start trickling down. This perception is driven by the experience of the structural-adjustment programmes that the international financial institutions (IFIs) insisted on in the 1980s and 1990s. Few would deny that such problems as persistent budget deficits, inefficient and ineffective government enterprises, and rapid inflation require reforms. Overwhelming debt burdens, often resulting from poorly conceived development projects and North-imposed SAPs, prevent governments from retaining revenue and dedicating sufficient resources to health, education, the environment, and community development. The implementation of the SAPs, it is claimed, has arrested Ghana's economy from complete collapse, resulted in consistent growth in GDP averaging 6% over the past decade, reduced inflation levels, created budget surplus, and increased export earnings. Summary. These claims are made sometimes more stridently, sometimes more cautiously and with qualifications. These changes brought economic incentives more into line with the country's underlying comparative advantage. reallocation of resources between sectors, changes in the distribution of income and institutional reform. Diese Maßnahmen sind für jedes Land einzeln zugeschnitten, jedoch weisen die meisten folgende Merkmale auf: Haushaltsdisziplin, Subventionsabbau, Deregulierung, kompetitive Wechselkurse, Abbau von Devisenverkehrsbeschränkungen, Privatisierung von Staatsbetrieben. Increased unemployment and decreased government services are the most direct blows, but changes in the tax system often emphasize easy-to-collect, regressive sales taxes that also disproportionately affect the lower classes. But the IFIs only tend to adopt neostructuralist programs of social investment after the dirty work of neoliberal structural adjustment has been mostly completed. liegen in ihrer Zuständigkeit.“. Structural adjustment programs, or SAPs for short, are a complex of loans that the World Bank (WB) and the International Monetary Fund (IMF) offer to a country suffering from an economic crisis. The emphasis placed by SAPs on increased exports can hasten the destruction of ecosystems by accelerating extractive enterprises such as the timber, mining, and fishing industries. Structural Adjustment Policies: Main Features and Social Implications The U.S. should encourage the recognition by the IFIs of the need for selective economic intervention by governments to regulate and guide sustainable and equitable growth. Content under a Creative Commons Attribution licence, by Carol Welch, Friends of the Earth, and Jason Oringer, The liberalization of trade does make imported items less expensive, but most people in low-income countries consume little besides basic necessities. The term "Structural Adjustment Program" has gained such a negative connotation that the World Bank and IMF launched a new initiative, the Poverty Reduction Strategy Initiative, and makes countries develop Poverty Reduction Strategy Papers. Through its aid and trade policies, Washington has worked to restructure the economic policies of the Southern nations. Thus, reforms intended to open countries to foreign trade, investment, and finance may result in increased exports and greater access to foreign capital, but they also heighten financial volatility and speculative investment, flood the affected countries with imported luxury goods, undermine local industry, and constrict local buying power. Sometimes SAPs are imposed despite overt opposition. Structural adjustment " is the name given to a set of "free market" economic policy reforms imposed on developing countries by the Bretton Woods institutions (the World Bank and International Monetary Fund (IMF)) as a condition for receipt of loans. Although there may be a new dynamism in certain elite sectors, social and economic insecurity deepens for most people in countries subjected to SAPs. The bank from which a borrowing country receives its loan depends upon the type of necessity. Designed by Baker and Brady of the U.S. Treasury Department, debt-renegotiation plans also ensured that neoliberal structural adjustment became a prerequisite for debt relief. A structural adjustment program is a plan implemented by the World Bank and the International Monetary Fund (IMF) in a developing nation to try to get their economies to be more productive. Structural adjustment is a term used to describe the policies requested by the IMF in condition for financial aid when dealing with an economic crisis in. The result can be increasing political instability (such as riots over food prices), outbreaks of guerrilla violence, and widespread disaffection with (and nonparticipation in) electoral political systems. Die Maßnahmen, deren Ursprünge auf die Bekämpfung der Schuldenkrise der 80er Jahre in den Entwicklungsländern zurückgehen, basieren auf marktwirtschaftlichen Prinzipien. By SAPs benefit a narrow stratum of the private sector—mostly those involved in export production, trade brokering, and portfolio finance. Um einen Schuldenerlass zu erhalten, müssen die Länder nun so genannte Armutsbekämpfungs- und Wachstumsprogramme durchführen (Poverty Reduction and Growth Facility, PRGF). The weak state of the domestic market exacerbates the worsening socioeconomic conditions. Furthermore, U.S. and IFI debt-relief programs should be delinked from SAP conditionalities. In addition, U.S. trade representatives began to insist on changes in other nations’ economic policies to facilitate increased U.S. trade and investment. Yet SAPs are largely imposed on developing countries without sufficient input from the very sectors of society that will be subjected to them. The neoliberal philosophy of economic development revived the old precepts of economic liberalism, which hold that an unregulated free market and private sector are the engines for unrestricted growth, the benefits of which will trickle down from the owners of capital to the entire population. As a result, the standard structural adjustment package advocated by the IFIs and the U.S. government fails to address a country’s individual needs, thereby generating an array of economic, social, political, and environmental problems. A structural adjustment is set of economic reforms that a country must adhere to in order to secure a loan from the International Monetary Fund and/or the World Bank. The U.S. should take the lead in advocating a major role for borrowing governments and their citizen representatives in determining loan conditions. The U.S. should broaden the focus of its foreign economic policy away from the narrow and misplaced objectives of SAPs to give more consideration to other issues such as sustainable growth, equitable distribution, employment generation, and community development. Through its financial clout in the IFIs, its central role in shaping global economic integration, and its own bilateral lending programs, Washington has the power to change or eliminate SAPs. Washington’s foreign policy should encourage sustainable, equitable development that benefits local people rather than international traders and financiers. The longer term Structural Adjustment Programme is aimed at the promotion of production and resource mobilisation through the promotion of commodity exports, public sector reform, market liberalisation and institutional reform. SAPs usually include several basic components geared toward reducing inflation, promoting exports, meeting debt-payment schedules, and decreasing budget deficits. The most recent change in SAPs is the IFIs’ promotion of good governance. April 1, 1998. The most important change the U.S. could initiate is to make binational and multinational financial agreements a more inclusive and open process. FOR OFFICIAL USE ONLY FOREWORD Under the Structural Adjustment Program (SAP) introduced in 1986, Nigeria reformed its foreign exchange system, trade policies, and business and agricultural regulations. Instead, it continues to pursue short-term gain, viewing the strict economic reforms required by SAPs as the best way to promote U.S. economic welfare. SAPs often succeed in achieving specific objectives such as privatizing state enterprises, reducing inflation, and decreasing budget deficits. Following an ideology known as neoliberalism, and spearheaded by these and other institutions known as the Washington Consensus (for being based in Washington D.C.), Structural Adjustment Policies (SAPs) have been imposed to ensure debt repayment and economic restructuring. Many people consider them agencies of misery, poverty and social distress. Although the IFIs and the U.S. government have touted SAPs as a solution to the economic problems facing the world’s poor and middle-income countries, the unstated goal of IFI-mandated structural adjustment is to integrate the countries of the South more completely into the North-dominated global trading, finance, and production systems. Layoffs of government workers, wage constraints, higher interest rates, reduced government spending, and the shutdown of domestic industries all contribute to the shrinking of the domestic market. Though macroeconomic factors need not be excluded from Washington’s policies, they should be part of a broader definition of U.S. national interests overseas and should encompass more than simply facilitating U.S. trade and investment. Understandably, the World Bank maintains that its structural adjustment programmes (SAPs) have been ‘successful’. IMF Lending to Poor Countries—How does the PRGF differ from the ESAF? Therefore, the conventional structural-adjustment programmes emphasised liberalisation, deregulation and privatisation. SAPs are based on a short-term, profit-maximization model that perpetuates poverty, inequality, and environmental degradation. The insistence by SAPs on the deregulation of laws and the downsizing of enforcement agencies further obstructs a government’s capacity to protect its environment. In agriculture, SAPs augment the economic liberalization resulting from free trade agreements, undermining peasant agriculture while reinforcing export-oriented agribusiness (and its dependence on dangerous agrochemicals). If economic standards and the adoption of economic policies are conditioned to financial assistance, they should not be stricter than those that the U.S. and other donor nations find acceptable for themselves, and they should be mutually agreed upon by both the U.S. and the borrowing country. It managed seven structural adjustment programs—covering the automotive industry, Arrium, Alinta, BlueScope Steel, Caterpillar, Queensland Nickel ‘Structural Adjustment’ or simply ‘adjustment’, emphasises the fact that in some instances successful stabilization requires structural changes in the domestic economy, e.g. Structural adjustment programs (SAPs) consist of loans provided by the International Monetary Fund (IMF) and the World Bank (WB) to countries that experience extensive economic crises. Social safety nets and good governance reforms do not compensate for the serious flaws that SAPs introduce by deregulating laws and diminishing the state’s capacity to protect the welfare of its citizens. Loan conditions and program documents should be publicly available so that all parties are informed and accountable. In this latter regard, SAPs have been successful. Washington should insist that all potentially affected sectors of the debtor country’s society are represented in the negotiating processes. Structural Adjustment Programs have been adopted by Kenya since the late 1980s along IMF-WB lines in order to solve the problems of growing foreign debt, fiscal and balance of payments (BOP) deficits, shortage of foreign exchange, stagnant productive sectors (especially the export-oriented sectors), and rising levels of unemployment.
2020 structural adjustment programs