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Structural Adjustment

Structural Adjustment

(2008)

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Abstract

Structural adjustment programmes are the largest single cause of increased poverty, inequality and hunger in developing countries. This book is the most comprehensive, real-life assessment to date of the impacts of the liberalisation, deregulation, privatisation and austerity that constitute structural adjustment. It is the result of a unique five year collaboration among citizensā€˜ groups, developing country governments, and the World Bank itself. Its authors, the members of the Structural Adjustment Participatory Review International Network (SAPRIN), reveal the practical consequences for manufacturing, small enterprise, wages and conditions, social services, health, education, food security, poverty and inequality. The stark conclusion emerges: if there is to be any hope for meaningful development, structural adjustment and neoliberal economics must be jettisoned.
Structural adjustment has been the most controversial economic and social policy model foisted onto a reluctant Third World in the past two to three decades. SAPRIN has been a pioneering network tracking, critiquing and acting on its damaging effects. This vitally important book cogently summarizes the various effects of structural adjustment and should be read by all who care about the developing world.' Martin Khor, Third World Network 'Structural Adjustment: The SAPRI Report illustrates the devastating impact that structural adjustment policies, undemocratically imposed by the international financial institutions, have had on national productive capacity, employment, wages and the growing number of people in poverty. It captures what we in Mexico and Latin America have fought against for the past two decades and is all the more pertinent given the intensifying challenges to neoliberalism in the region.' Cuauhtemoc Cardenas, former Senator, Governor and Mexican presidential candidate 'An excellent expose of how people's human rights are being sacrificed on the altar of the free market in the name of development.' Fantu Cheru, former UN Special Rapporteur on Structural Adjustment 'This book documents a unique exercise in broad-based civil society participation, collaboration and engagement with official institutions. It represents a strong challenge to governments and the World Bank to open up economic policymaking to reflect local knowledge and realities.' Lidy Nacpil, Jubilee South and Secretary General, Freedom from Debt Coalition (Philippines) 'We urgently need to change the way the aid business is conducted, including structural adjustment. This global report contains findings that warrant close examination by the international financial institutions, development agencies, and national governments.' Jan Vandemoortele, Bureau for Development Policy, UNDP '...is an excellent and important book, one that helps to illuminate and further problematize a critical concept in contemporary international development. The book should be of keen interest to economists, development practitioners and theorists, and social movement activists alike. The introductory chapter is particularly fascinating and insightful.' Pablo S. Bose, York University, Toronto 'Exposes a human reality among the poor in developing countries, which may belittle or even falsify official statistics...it is high time that the report is finally available as a book.' Modern African Studies
SAPRIN is a global network established to expand and legitimize the role of civil society in economic policymaking and to strengthen the organized challenge to structural adjustment programs by citizens around the globe. It is composed of broad-based civil society networks in Argentina, Bangladesh, Ecuador, El Salvador, Ghana, Hungary, Mexico, the Philippines, Uganda and Zimbabwe, which along with non-governmental organizations based in Europe, Canada and the United States comprise SAPRIN's Steering Committee. The network has brought together trade unions, small business and farmers' associations, environmental and indigenous peoples' organizations, women's and community groups, religious and human rights organizations, development and research institutes, NGOs, and associations of youth, pensioners and the disabled. SAPRIN's diverse program has included extensive citizen mobilization, local workshops and national public fora, participatory field research, economic literacy training, and the development and promotion of alternative economic policy proposals at the country level on four continents. At the global level, SAPRIN's advocacy work vis-a-vis the World Bank, United Nations agencies and national governments has focused on the elimination of adjustment conditionality and on the democratization of the economic policymaking process and on opening it to new policy options. The SAPRIN Secretariat is based at The Development GAP in Washington, D.C.

Table of Contents

Section Title Page Action Price
Cover Cover
About this book i
About SAPRIN ii
Table of contents v
Tables, Boxes and Figures viii
Acronyms ix
Acknowledgements x
SAPRIN and World Bank Global Steering Committee Members xiv
1 Structural Adjustment and the SAPRI/CASA Experience 1
The Origins of Structural Adjustment 1
The Genesis of SAPRI 5
Forging a Joint Initiative with the World Bank while Maintaining Civil Society Independence 7
Civil Society Mobilization and Participation 12
National Public Fora: Infusing the Economic Policy Debate with Local Knowledge 21
Joint Research to Deepen Local Civil Society Assessments of Adjustment Policies 24
World Bank Distances Itself from the Emerging SAPRI Findings 31
Elaborating the Results of the Global Policy Assessment\r 33
2 Trade Liberalization Policies and Their Impact on the Manufacturing Sector 36
Design of Trade Policy Reforms 39
Macro and Sectoral Outcomes of Trade Policy Reforms 48
Distributional Impacts of Trade Policy Reforms 62
Conclusion\r 69
3 Financial Sector Liberalization: Effects on Production and the Small Enterprise Sector 72
Background and Process of Financial Sector Liberalization 73
Impact of Financial Sector Reforms 75
Conclusion\r 83
4 Employment under Adjustment and the Effects of Labour Market Reform on Working People 87
Country Characteristics 88
Adjustment Programmes, Employment and Poverty 91
Labour Market Reforms and Flexibilization 101
Wages and Working Conditions 104
Conclusion\r 107
5 The Economic and Social Impact of Privatization Programmes 110
Reasons for Privatization 111
Privatization Programmes and Processes 113
Economic Results of Privatization 114
Social Impact of Privatization 122
Transparency 126
Conclusion\r 127
6 The Impact of Agricultural Sector Adjustment Policies on Small Farmers and Food Security 132
Objectives, Policies, Strategies and Design of Agricultural Reform 133
Economic Impact of the Reform Policies 135
Social and Environmental Impacts 143
Conclusion\r 149
7 The Socioeconomic and Environmental Impact of Mining Sector Reform 153
Background 153
Adjustment Policies, Legislation and Actions Affecting the Sector 155
Economic Impacts 157
Social and Community Impacts 160
Environmental Impacts 165
Conclusion 170
8 The Effects of Public Expenditure Policies on Education and Healthcare under Structural Adjustment 174
Adjustment Policies Addressed 176
The Impact of Adjustment Reforms on Public Spending for Education and Healthcare 177
The Impact of Reforms on Access to, and Quality of, Education and Healthcare Services 185
The Impact on the Poor of the Elimination of Basic Subsidies 197
Conclusion\r 199
9 Structural Adjustment, Poverty and Inequality 203
The Impact of Trade and Financial Sector Reforms on Manufacturing, Employment and Small and Poor Producers 204
The Impact of Reforms on Agricultural Production, Small Farms, Food Security and Poor Communities 207
The Impact of Labour Market Reform and Privatization on Wages, Employment and Poverty 211
The Impact of the Privatization of Public Utilities and Public Expenditure Reform on the Availability of Affordable Services and on Poverty 213
Weak Macroeconomic Performance under Adjustment 217
Shaping a Different Future 220
SAPRIN National Steering Committees 226
Bibliography of SAPRI/CASA National Reports 231
Index 236