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Number of Downlaods: 27

Published Date: Nov 15, 1998

Structural Adjustment and Social Development: An Agenda for the Poor (R-17)

Jennifer Bennett, SDPI
1998

Introduction

Structural Adjustment Programs (SAPs) are not simple instruments for rectifying macroeconomic imbalances through the imposition of policies like currency devaluation, privatization, trade liberalization and cuts in government spending. They are, instead, carefully manoeuvred and structured political projects for social and economic transformation, at global and domestic levels, in the interest of the North. Poor developing countries are often given loans in the name of development. The main arbiters are the World Bank (WB) and the International Monetary Fund (IMF). The Third World leaders are told that in order to pay off loans and be eligible for more, they must implement ‘structural adjustment’ reforms, accompanied by conditionalities, dictated by the North. The vicious cycle never ends. The same conditionalities are imposed in every accepting country, regardless of the kind of economic or social crises experienced.

While the objectives for which Structural Adjustment (SA) policies were designed and implemented remain unsolved, its interminable adverse impacts afflicting most developing countries include crippling declines in Third World economies, social degeneration, rising unemployment and poverty, posing serious challenges to human resource development and wellbeing. The entire era of the last decade to the present is marked with debt crises, shrinking resources, structural changes, and glaring socioeconomic and environmental destruction in the developing world. Under the theme of ‘pay loans in order to be eligible for more loans’ the total external debt of developing countries increased from $ 100 billion in 1970 to $650 billion in 1980 and $1,300 billion in 1990. In 1994, the ratio of the incomes of the richest 20 per cent of the world to that of the poorest 20 per cent was 78 to 1, up from 30 to 1 in 1960(1).

This paper travels through the genesis of SA programs to validate the argument of maladjustment and maldevelopment as instigated by these policies. Taking Pakistan as a case in point, the argument is built around social and economic disparities, between the rich and the poor, how the already marginalized are further marginalized under the umbrella of SA and what countervailing strategies need to be pursued to promote human welfare. Specifically, it looks at the impact of SA reforms on the health sector.