The saps implemented in african countries were expected to ultimately reduce poverty by fostering economic growth and by shifting relative prices in favour of agriculture and rural areas where most of the poor live world bank, 1981. The impact of structural adjustment programmes on the. Lessons from structural adjustment programmes and their. The structural adjustment programme has not been able to get zambia out of its cycle of rising foreign debt. It describes how saps are being implemented and what results they have produced over the past 20 years. Using heckman regressions we find evidence that participation in imf programs is connected to higher poverty rates and a more unequal. This reduced zambias heavy dependence on copper, leading to a growing trend towards nontraditional exports including agroprocessing, primary products and textiles. By the early 1980s, however, it was clear that the 1970s reform had failed.
Structural adjustmenta major cause of poverty global issues. Political and economic liberalisation in zambia 19912001 lise rakner the nordic africa institute, 2003 rakner i page 1 wednesday, october 1, 2003 2. The impact of structural adjustment programmes in africa. Zambia itself is one of subsaharan africa s most highly urbanized countries. This reduced zambias heavy dependence on copper, leading to a growing trend towards nontraditional exports including agro. Political and economic liberalisation in zambia 19912001. The problems of gender relations in africa have been exacerbated by saps in a number of important ways. As a result, the structural adjustment program found its birth in international forums and not in african legislatures. The two bretton woods institutions require borrowing countries to implement certain policies in order to obtain new loans or to lower interest rates on existing ones.
Anticipating a rise in copper prices, the government borrowed heavily to sustain the economy. About onehalf of the countrys 16 million people are concentrated in a few urban zones strung along the major transportation corridors. Structural adjustment programmes and industrialization. Jan 31, 2012 the structural adjustment programs saps are created with the goal of reducing the borrowing countrys fiscal imbalances. How the imfworld bank and structural adjustment program. In addition, there was not only a reluctance by zambian policymakers to. The paper argues that sap is an inappropriate public policy for zimbabwe. Compared to many other southern african countries, zambia has relatively abundant land and water. The zambian prsp revolves around three main themes. Education under structural adjustment per cent of the government annual expenditure being used to support the mining industry kelly, 1991.
In fact saps were meant to reverse the damage which zambianisation had inflicted on postcolonial zambian economy. The economy of zambia is one of the fastest growing economies in africa and its capital, lusaka is the fastest growing city in the southern african development community sadc. Structural adjustment programmes saps or economic recovery programmes. The impact of economic structural adjustment programs esaps. May 20, 20 here, the saps were used to breakdown the socialist system of governance, cut down national social spending and allow free markets to run the economy rather than the state.
An overview of zambias economic and poverty situation introduction poverty is the most profound challenge that zambia faces today. Structural adjustment programmes saps that were wholly externally driven, the. Since the late1980s, the view that saps are based on wrong assumptions about africa and are inimical to the continents longterm development have gained ground as has the position that saps have either created or worsened poverty levels or at the very least, have ignored the adverse effects of the programme on the poor. The impact of nationalization policies on the zambian economy. But the way it has happened has required poor countries to reduce.
Regional instability would now, more than before, be to the detriment of both. The following outline of chapters shows the areas that the article has focused on. To the extent that saps failed to promote growth, no improvement in poverty can be expected from growth effects. The effect of structural adjustment programmes on the delivery of veterinary services in africa. In the short term this development might seem profitable, but may have long term adverse effects on the resource base and the national economy. In line with other newly independent african countries, the.
The impact of economic structural adjustment programs. Africa and increase it utilization of its raw materials and human resour ces. This article also gives a short analysis of the roles of the world bank, the imf and the local political elites in this process. Copper mining in zambia page 3 paper 165 july 2008 the core business of mining and the politicisation of the zccm board led. The impact of colonialism on african economic development.
The latest jctr 2001 monthly food basket survey shows that it is becoming more and more. By 1982, the real price of copperwas at its lowest for nearly 40 years krumm, 1984, in kelly, 1991. A large share of the blame for this disaster can be put at the feet of the collapse of the world price of. Copper mining in zambia page 3 paper 165 july 2008 the core business of mining and the politicisation of the zccm board led some observers 2 to conclude that this may have been responsible for the poor performance of the mines in the 1980s and early 1990s. Structural adjustment programs saps consist of loans provided by the international monetary fund imf and the world bank wb to countries that experienced economic crises. As the zambian economy experienced a prolonged recession in the 1980s, exacerbated by balance of. Agriculture, fishery and forestry, which account for 20 per cent of zambian gdp, shrunk by 2. How does political instability affect economic growth. Doc impacts of saps on zambia obert hagwena academia.
Internationally it is recognised that, since the 1980s, saps have helped more. To assist african development, structural adjustment programmes saps provided conditional lending thomson, 2010. The effect of structural adjustment programmes on the delivery of veterinary services in africa 3 officially recognized as part of the animal health delivery system. I will then underscore the effect of the crisis on the zambian economy before i look at the policy responses, the challenges and then conclude. Despite these measures, zambia had negative economic growth between 1991 and. Macroeconomic case study on zambia zambia, africa at. Namibia and ghana in 1997 angniman, 1997, ilemobade, 1996. Pdf the political economy of policy failure in zambia.
Coupled with the dwindling income from zambias exports was the rise in the prices of oil imports. Development should start by encouraging zambian companies to develop its country by employing local resources. Consistent implementation of a structural adjustment programme. African countries, globalization, economic development. Namibia did not undergo a sap and in zimbabwe veterinary services were not included in the sap. The effects of the two evils of nepotism and corruption are not apparent to the naked eye but the reality is that it does have a negative impact on any the economy. The structural adjustment programs saps are created with the goal of reducing the borrowing countrys fiscal imbalances. The paper examines the impact of selected structural adjustment policies on food production in zambia. There are number of jobs that the government has given to foreign investors.
Structural adjustment programs saps were prescribed for africa beginning in the early 1980s when it became apparent that there was a big economic crisis looming over africa. This is equivalent to 20 percent of zambias gdp similar to what china invested in infrastructure in the mid2000s, and is about double the countrys rate. Analysing the effects of financial liberalization on zambias. However, more specific liberalisation measures include. The effect of salinity on the survival and growth of batanga lebretonis steindachner from the lagos lagoon, nigeria was monitored in the laboratory for 24 weeks. In the past decade, the zambian government made an essential move towards privatized and open market economy. While gender inequality in africa predates saps, the effects of saps and the policy climate they create are inimical to the promotion of social programmes and measures to address this issue. The african economy was significantly changed by the atlantic slave trade through the process of imperialisnl and the economic policies that accompanied colonization. Here, the saps were used to breakdown the socialist system of governance, cut down national social spending and allow free markets to run the economy rather than the state. Zambia itself is one of subsaharan africas most highly urbanized countries. Analysing the effects of financial liberalization on. The bank from which a borrowing country receives its loan depends upon the type of necessity. In discussing this topic, i will begin by highlighting, albeit briefly, the origins of the current global economic crisis. Structural adjustment and the debt crisis saps were born as a result.
During the past decade, most countries in africa have undertaken structural adjustment programs saps of one form or another. In line with other newly independent african countries, the goz transferred ownership to. Africa, economic development, agricultural policies. The effects of structural adjustment programs on poverty and income distribution by doris a. Oberdabernig abstract the focus of this work is to measure the effects of structural adjustment programs saps of the international monetary fund imf on poverty and income distribution.
First, that given the appalling state of soes in uganda, and its negative effects on the economy, privatisation was the most ideal choice for government. Stabilization policies aim at returning an economy to an equilibrium. Jun 29, 2018 in fact saps were meant to reverse the damage which zambianisation had inflicted on postcolonial zambian economy. The ultimate goal of these policies is to reduce the incidence of poverty in zambia and to improve the wellbeing of the zambian people. Analysing the effects of financial liberalization on zambias economic growth stephen maimbika, university of namibia, namibia. Has pf mismanaged zambias economy or are external factors. A read is counted each time someone views a publication summary such as the title, abstract, and list of authors, clicks on a figure, or views or downloads the fulltext. About onehalf of the countrys 16 million people are concentrated in a few urban zones. Macroeconomic case study on zambia by dr eric gondwe.
Zambia particularly in the field of gemstone and industrial mineral, which offer great potential. An evaluation of the policies, procedures and experiences caleb m. The dependence of zambian maize production on imported fertilizers and. In view of the above analysis it can be concluded that zambianization was a politically sound policy which was meant to consolidate the newly elected unip government power. The outlook for the zambian economy remains favourable in the medium term, underpinned by robust growth and singledigit in. We control for economic factors and include regional submodels to test for robustness. The saps are supposed to allow the economies of the developing countries to become more market oriented.
This policy framework paper pfp gives an overview of the governments adjustment program for the period 19992001. The effects of structural adjustment programs on poverty. After 1975, zambia faced falling copper prices initially thought by government as temporal, political turmoil in neighbouring countries and severe effects of the first oil shock. Did structural adjustment programmes assist african development. This study examines the impact of esaps on the living standards of zimbabwe people and draws some parallels between the impact of economic policy on social welfare of particularly impoverished women and children in zimbabwe and the united states. The clearest impact of privatisation is that it places ownership of the copper mines in private hands, rather than being in the control of government, and in zambia s case, because there are few if any zambian companies with enough wealth to buy a copper mine, it places ownership in the hands of foreign firms rather than zambian nationals. Between the periods 19701975, 19761990 and 19911999, per capita gdp fell by 0. In nigeria, the most prominent and vocal opposition against sap came from the. The impact of privatisation on the zambian economy from 1975 zambias economy underwent a world record breaking decline. It is a social crisis with the majority of people denied a minimum decent living standard.
As such, the profession produced an ample literature documenting the negative effects of political instability on a wide range of macroeconomic variables including, among others, gdp growth, private investment, and inflation. This study examines the impact of structural adjustment policy sap on the welfare of zimbabweans, particularly women and children and draws some parallels with economic policy in the us and its effect on social welfare programs and the poor. The impact of structural adjustment programmes on the natural. Second that despite this, there is contention that the process has been poorly managed and that the timing and sequencing of the program were not proper. Saps in tanzania, we have experienced increased allocation of protected areas land to lodge development, hotel construction on fragile beach areas or over utilization of the national parks.
Pdf the impact of globalization on african countries. African countries, globalization, economic development, information technology. The process by which countries economies become increasingly interwoven and affected by each other. How the imfworld bank and structural adjustment programsap. Larry liu the zambian economy and the imf one of the most concerning trends in developmental. Jan, 2015 as this ran through angola, a liberalised zambian economy would benefit only from angolas peaceful, orderly transition thomson, 2010. In general, adjustment meant liberalising and privatising, although saps were wider in scope in that their developmental aims were highly political. The paper argues that economic structural adjustment programs esaps, introduced by the world bank. Fundanga and andrew mwaba introduction the term privatization is often loosely used to mean a number of related activities, including any expansion of the scope of private sector activity in an economy and the adoption by the public. The impact of structural adjustment programs saps on the performance of sub saharan africa ssa has been deeply investigated and, despite what the international monetary fund imf and the world bank claimed, adjustment policies have often had a negative impact on the poorest and most vulnerable sections of the regions population. The highly indebted zambia had to adhere to saps for more borrowing which included currency devaluation hence further increase in commodity prices, privatisation of the economy which resulted in mass job losses due to liquidations of industries, retrenchments and collapse of most enterprise. Using a fouryear panel of postharvest data, a system of six. Newsrescue below is a brief background of the events that led many countries to accept saps.
Whereas in 1990, the economy was dominated by stateowned enterprises, government administered price structures and protective mechanisms, zambia today has a much more open economy where prices are largely market determined and the greater part of previously stateowned enterprises have been restructured and divested to the private sector. Did structural adjustment programmes assist african. May 26, 2009 newsrescue below is a brief background of the events that led many countries to accept saps. At independence in 1964, zambia inherited a private sector driven economy dominated by the foreignowned mining sector contributing almost 50% of gdp and even more of government revenues.
Zambian woman quoted above, who are feeling the effects of. Nov 07, 2012 africa and increase it utilization of its raw materials and human resour ces. The effects of structural adjustment programs on poverty and. Lessons from structural adjustment programmes and their effects in.
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