Imf Structural Adjustment Programs in Africa - 1070 Words

IMF STRUCTURAL ADJUSTMENT PROGRAMS IN AFRICA INTRODUCTION Beginning in 1980, the International monetary Fund (IMF) started to impose Structural Adjustment Programs (SAP) on African debtor nations. SAP’s have been imposed on 36 African Sub-Saharan countries under the assumption that neo-liberal reforms lead to economic growth and an increased standard of living. For that reason, focus was put on macroeconomic policies with the open market based approach. SAP’s generally mandated: -the removal of protections in the manufacturing sector;the elimination of government subsidies for food and some other items -trade liberalization;reductions in barriers to trade, as well as foreign investment and ownership -increased role of the private†¦show more content†¦Forced liberalization of the groundnut sector in 2002 led to a state of famine in rural areas. Less that 30% of the groundnut crop was collected. Farmers lost millions of dollars in income and economic growth was cut in half. Nearly 80% of the population lives on less than $2 a day. In 1998 Senegal spent five times as much repaying foreign debt than as on health. The Senegales government, however, in order to obtain required debt relief, needed to pursue further implementation of SAP’s. THE IMPACT OF STRUCTURAL ADJUSTMENT POLICIES ON THE AFRICAN CONTINET By the 1990’s , most African countries were spending each year more on debt than on health care and education. More than 200 million Africans have no access to health services after the privatization of health sector and cuts in government spending. Each day 6000 Africans die from AIDS and each day an additional 11000 were infected (in 2000). Africa accounts for 80% of AIDS deaths worldwide, and 90% malaria-related deaths as well. In the education arena , the statistics are just as appalling: 40% of children are out of school and more than 140 million young Africans are illiterate. While African countries urgently needed to increase splending on health care and education, IMF SAP’s forced a large reduction in needed spending. With time, debt was increasing and basic needs suffered in Africa in order to repay the debt. Under SAP’s , Africa’s external debt has increasedShow MoreRelatedThe World Bank And The Imf Essay1328 Words   |  6 PagesThe World Bank and the IMF are collectively known as the Bretton Woods institutions. They were formed at a conference in Bretton Woods in New Hampshire with the aim to addressing concerns to do with stability of world economic markets. IMF is mainly tasked with offering surveillance, financial aid and technical assistance. IMF has 187 member states who each appoint a representative to the IMF’s board of Governors. 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