IMPOVERISHING A CONTINENT:
The World Bank and the IMF in Africa
Asad Ismi
Canadian Centre for Policy Alternatives
July 2004
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CONTENTS
Introduction
The World Bank and the IMF
The U.S. Connection
Structural Adjustment
LIC-FLIC
Adjusting Africa
- Impacts of Adjustment
Zimbabwe
Ghana
Cote d'Ivoire
Conclusion
Endnotes
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INTRODUCTION
Just between you and me, shouldn't the World Bank be encouraging more
migration of the dirty industries to the LDCs [less-developed
countries]?... I think the economic logic behind dumping a load of
toxic waste in the lowest wage country is impeccable and we should face
up to that...I've always thought that underpopulated countries in
Africa are vastly under-polluted, their air quality is probably vastly
inefficiently low compared to Los Angeles or Mexico City...The concern
over an agent that causes a one in a million change in the odds of
prostrate cancer is obviously going to be much higher in a country
where people survive to get prostrate cancer than in a country where
under 5 mortality is 200 per thousand...The problem with the arguments
against all of these proposals for more pollution in LDCs (intrinsic
rights to certain goods, moral reasons, social concerns, lack of
adequate markets, etc.) could be turned around and used more or less
effectively against every Bank proposal for liberalization.
- Lawrence H. Summers, chief economist of the World Bank, in an
internal memo dated December 12, 1991. Summers went on to become the U.
S. Treasury Secretary in the Clinton Administration as well as
president of Harvard University. (See Appendix).
The World Bank and the International Monetary Fund (IMF) are the two
most powerful institutions in global trade and finance.(1) Since 1980,
the United States government which dominates both bodies, has used them
to economically subjugate the developing world. The World Bank and the
IMF have forced Third World countries to open their economies to
Western penetration and increase exports of primary goods to wealthy
nations. These steps amongst others have multiplied profits for Western
multinational corporations while subjecting Third World countries to
horrendous levels of poverty, unemployment, malnutrition, illiteracy
and economic decline. The region worst affected has been Africa.
For two decades the World Bank and the IMF have forced developing
countries to create conditions that benefit Western corporations and
governments. These conditions are known as Structural Adjustment
Programs (SAPs). SAPs require governments to: cut public spending,
(including eliminating subsidies for food, medical care and education);
raise interest rates, thus reducing access to credit; privatize state
enterprises; increase exports; and reduce barriers to trade and foreign
investment such as tariffs and import duties. These measures are
supposed to generate export-led growth that will attract foreign direct
investment and can be used to reduce debt and poverty. (2)
According to a three-year, multi-country (including three African
countries) study released in April 2002 by the Structural Adjustment
Participatory Review International Network (SAPRIN), which was prepared
in collaboration with the World Bank, national governments and civil
society, SAPs have been "expanding poverty, inequality and insecurity
around the world. [They have] torn at the heart of economies and the
social fabric...increasing tensions among different social strata,
fueling extremist movements and delegitimizing democratic political
systems. Their effects, particularly on the poor are so profound and
pervasive that no amount of targeted social investments can begin to
address the social crises that they have engendered."(3)
SAPRIN explains this damning indictment by identifying four ways in
which reforms under SAPs have impoverished people and increased
economic inequality. Firstly, trade and financial sector reforms have
destroyed domestic manufacturing leading to massive unemployment of
workers and small producers. Secondly, agricultural, trade and mining
reforms have reduced the incomes of small farms and poor rural
communities as well as their food security. Thirdly, labour market
flexibilization measures and privatizations have caused mass lay-offs
of workers and resulted in lower wages, less secure employment, fewer
benefits and "an erosion of workers rights and bargaining power."
Privatization of major national assets and essential services has also
allowed multinational corporations to remove resources and profits from
countries as well as increase rates for water and electricity which has
hit the poor the hardest. Fourthly, the cutting of health and education
spending under SAPs and the introduction of user fees for these
services, when combined with higher utility rates, has resulted in "a
severe increase in the number of poor as well as a deepening of
poverty."(4)
In the following sections we look at the effects of conditions imposed
by the World Bank and the IMF's SAPs, on Africa generally and on three
African countries, Zimbabwe, Ghana and Cote d'Ivoire, in particular.
But first an overview of the World Bank, the IMF and structural
adjustment.
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THE WORLD BANK AND THE IMF
The World Bank or the International Bank for Reconstruction and
Development (IBRD) and the International Monetary Fund (IMF) were
created in 1944 by leaders of the 44 nations at the Bretton Woods
Conference. The Bank was responsible for financing long-term productive
investment in member countries while the IMF was to provide loans to
overcome short-term balance of payments deficits. Western leaders
feared an unregulated world market would mean a return to depression,
poverty and another world war.(5) At Bretton Woods (located in New
Hampshire, U.S.), "the decisive factor was the reality of American
power." With much of Europe destroyed by the Second World War, the U.S.
was economically the world's most powerful country; thus a U.S. vision
prevailed at the conference and the World Bank and the IMF were created
along U.S. lines. Unlike the U.N. also founded at the time, the World
Bank and the IMF were controlled by one-dollar one-vote rather than one-
country one-vote. Washington alone has a veto over decisions about the
mandates and structure of the organizations. This is because the U.S.'
voting share is 17.16% in the IMF and 16.41% in the World Bank and in
both organizations changes to the Articles of Agreement require 85% of
the votes. Japan holds the next highest voting shares with 6.27% and
7.87% respectively.(6) The U.S. also has the unique privilege of
appointing the President of the World Bank and is the only country
entitled to a permanent place among the Bank's executive directors.(7)
The World Bank Group is made up of five organizations: The IBRD which
provides loans and development assistance to middle-income and
creditworthy poor countries; International Development Association
(IDA), the Bank's concessional lending arm, focused on the poorest
countries to which it provides near zero-interest loans. International
Finance Corporation (IFC) which finances private sector investments in
the developing world and provides technical assistance to governments
and businesses. Multilateral Investment Guarantee Agency (MIGA) which
encourages foreign investment in developing countries by providing
guarantees to foreign investors against loss caused by non-commercial
risk. Lastly, the International Centre for Settlement of Investment
Disputes (ICSID) provides international facilities for arbitration of
investment disputes.(8) As constituted, the World Bank is supposed to
be both a bank and a development agency focused on poverty alleviation
whereas the IMF is only a financial institution (for more on the IMF
see section on structural adjustment below).
The U.S. Connection
Washington's predominance ensured that whatever their theoretical
mandates might be, the World Bank and the IMF would become instruments
of U.S. foreign policy. The role of both has been to fully integrate
the Third World into the U.S.-dominated global capitalist system in the
subordinate position of raw material supplier and open market. As such
these institutions complement the U.S.' use of the Pentagon and the CIA
to crush Third World governments aspiring to independent development. A
good example of this kind of coordination was the ending of World Bank
loans in 1972 to the elected government of Salvador Allende in Chile-
the first step in a U.S.-planned destabilization. President Richard
Nixon and his National Security Adviser, Henry Kissinger, used the Bank
to (as the President stated) "make the Chilean economy scream." The
subsequent economic crisis "paved the way for the bloody coup of 1973."
The U.S. then poured aid on the military dictatorship of General
Augusto Pinochet who killed Allende and up to 130,000 Chileans in a 17-
year reign of terror. From 1973 to 1976, the World Bank gave Chile
$350.5 million, almost 13 times the $27.7 million it gave during the
three-year Allende presidency. (9)
Robert McNamara, who became the World Bank's president in 1968, best
epitomized the close U.S. connection. McNamara had been Secretary of
Defense before being transferred to the World Bank by President
Johnson. The Secretary had grown disillusioned with his idea of bombing
North Vietnam since this had failed to stop Northern support for
insurgency in South Vietnam. Under McNamara's presidency (1968-1981),
the World Bank experienced its most dramatic growth with annual lending
growing from U.S.$2.7 billion a year to U.S.$12 billion.(10) McNamara
sought to speed up the Third World's integration into the global
capitalist order by promoting "export-oriented growth." He declared
that development which depended on small, protected internal markets
was "a losing strategy." Instead, Third World economies should attach
themselves to the expanding markets of the U.S. and other wealthy
countries. McNamara wanted the World Bank to support "special efforts...
in many countries to turn their manufacturing enterprises away from the
relatively small markets associated with import substitution towards
the much larger opportunities flowing from export promotion." (11)
Structural Adjustment
The debt crisis in the 1980s gave Washington the opportunity to "blast
open" and fully subordinate Third World economies through World Bank-
IMF structural adjustment programs (SAPs). (12) Starting in 1980,
developing countries were unable to pay back loans taken from Western
commercial banks which had gone on a huge lending binge to Third World
governments during the mid to late1970s when rising oil prices had
filled up their coffers with petro-dollars.(13) The World Bank and the
IMF imposed SAPs on developing countries who needed to borrow money to
service their debts. The World Bank's SAPs, first instituted in 1980,
enforced privatization of industries ( including necessities such as
healthcare and water), cuts in government spending and imposition of
user fees, liberalizing of capital markets (which leads to unstable
trading in currencies) market based pricing (which tends to raise the
cost of basic goods) higher interest rates and trade liberalization.
SAPs evolved to cover more and more areas of domestic policy, not only
fiscal, monetary and trade policy but also labour laws, health care,
environmental regulations, civil service requirements, energy policy
and government procurement. (14)
With the imposition of its own SAPs in 1986, the IMF became "one of
the most influential institutions in the world." Its 2,500 staff
dictate the economic conditions of life to over 1.4 billion people in
75 developing countries. As one observer put it, "Never in history has
an international agency exercised such authority." Until the 1980s, IMF
involvement with Third World countries had been short-term and its
impact minimal but after the debt crisis it took on an greatly expanded
role in imposing austerity conditions on countries in financial
difficulties. (15) The Fund became the gendarme for Western commercial
banks ensuring that they would get repaid and helping them "consolidate
their power over poor nations." Borrowing countries knew that they
would not get further loans from other sources without the IMF seal of
approval. One observer called the Fund, "a sort of Godfather figure-it
makes countries offers they can't refuse." (16) Classic IMF
stabilization programs involve: a standard set of policies aimed at
reducing current account deficits. These invariably include a
contraction of the money supply and fiscal austerity measures aimed at
reducing "excessive demand" in the domestic economy; demands for strict
anti-inflationary monetary policy, privatization of public enterprises,
trade liberalization and dismantling of foreign exchange controls; more
flexible labour markets (in other words, a lowering of labour
standards) and reducing the size of the public sector. This has meant
cutbacks to education, health care and the social sector, and the
elimination of subsidies and marketing boards for agricultural products
as well as the privatization of such basic services as potable water,
health care and education. (17)
During 1980-93, 70 developing countries were subjected to 566
stabilization and structural adjustment programs with disastrous
consequences; the 1980s became known as the "lost decade." Between 1984
and 1990, Third World countries under SAPs transferred $178 billion to
Western commercial banks. So enormous was the capital drain from the
South that Morris Miller, a Canadian former World Bank director
remarked: "Not since the conquistadors plundered Latin America has the
world experienced such a flow in the direction we see today." (18) By
severely restricting government spending in favor of debt repayment,
the loan terms of the Bank and the IMF eviscerated the Third World
state leaving in its wake spiraling poverty and hunger fueled by
slashed food subsidies and decimated health and education sectors.
Growth stagnated and debt doubled to over $1.5 trillion by the end of
the 1980s, doubling again to $3 trillion by the end of the 1990s.(19)
As U.N. Secretary General Javier Perez de Cuellar noted in 1991: "The
various plans of structural adjustment-which undermine the middle
classes; impoverish wage earners; close doors that had begun to open to
the basic rights of education, food, housing, medical care; and also
disastrously affect employment-often plunge societies, especially young
people, into despair."(20)
After 15 years of following World Bank and IMF-imposed policies, Latin
America, by the late 1990s, was going through "its worst period of
social and economic deprivation in half a century." By 1997, nearly
half of the region's 460 million people had become poor-an increase of
60 million in ten years. Populations, overall, were worse off than they
were in 1980. The United Nations Economic Commission for Latin America
and the Caribbean (ECLAC) stated in 1996: "the levels of [poverty] are
still considerably higher than those observed in 1980 while income
distribution seems to have worsened in virtually all cases." (21)
SAPs imposed on Peru by the World Bank and the IMF pushed four million
people into extreme poverty, almost halved real wages, and cut those
with "adequate employment" to 15 percent of the workforce.
Consequently, there was a forced migration of impoverished peasants and
urban unemployed into coca growing (for drug traffickers) as an
alternative to starvation. In 1991, in exchange for $100 million from
the United States, Peru put in place the IMF structural adjustment
clause opening its markets to U. S. corn. As a result, by 1995, corn
cultivation had fallen tenfold and coca production had grown by 50
percent. Under these conditions, corruption flourished; indeed almost
an entire economy was criminalized. Increased coca production meant
more cocaine trafficking which led to deepening official corruption in
Peru as the amount of money in the hands of drug lords increased. (22)
An IMF-sponsored stabilization package implemented in Peru in 1990 had
the following consequences: "From one day to the next, fuel prices
increased 31 times-by 2,968%. The price of bread increased 12 times-by
1,150%. The prices of most basic food staples increased by six or seven
times-446% in a single month-yet wages had already been compressed by
80% in the period prior to the adoption of these measures in August
1990." (23) IMF SAPs were first imposed on Mexico in 1982; in the
following decade infant deaths due to malnutrition tripled, the minimum
wage fell by 60% and the percentage of the population living in poverty
rose from less than half to more than two-thirds. More recently, World
Bank-IMF SAPs played a major role in causing the collapse of the
Argentine economy in December 2001; these SAPs also fuelled the Asian
financial crisis of 1997. (24)
LIC-FLIC
The World Bank-IMF SAPs were "the second prong of the massive assault
that Washington mounted against the South" during the 1980s. The other
prong was "low-intensity conflicts" (LIC), the U.S. launched against
governments in Afghanistan, Angola, Nicaragua, Panama, and Grenada, and
against liberation movements in El Salvador, Guatemala, and the
Philippines. One observer has called the World Bank-IMF debt management
strategy, "financial low-intensity conflict" (FLIC). U.S. officials are
clear about the link between economic and military strategies in
controlling the Third World. The Presidential Commission on Integrated
Long-Term Strategy stated in 1988: "We... need to think of low-
intensity conflict as a form of warfare that is not a problem just for
the Department of Defense. In many situations, the United States will
need not just DoD personnel and material but diplomats and information
specialists, agricultural chemists, bankers and economists...and scores
of other professionals." (25)
The Reagan Administration came into office in 1980 determined to
discipline an increasingly independent Third World and make it serve U.
S. economic interests. The 1950-1980 era was marked by high economic
growth rates in parts of the developing world as well as successful
national liberation struggles. The Administration's sense of "a rising
threat from the South" was fed by the humiliating U.S. defeat in
Vietnam, the Nicaraguan revolution, the OPEC oil embargoes of 1973 and
1979, the threat of new cartels for other raw materials, the Iran
hostage crisis, restrictions on multinational corporations in Mexico
and Brazil, and the Third World's demand for a New International
Economic Order (NIEO). (26) Since the Third World state was the main
culprit in all these threats, this is what had to be broken down
through both LIC and FLIC. In the case of Nicaragua, Reagan used the
Contras to militarily attack the revolutionary Sandinista government
and the World Bank to pressure it economically as Nixon had done with
Chile. Thomas Clausen, Reagan's appointed World Bank President, stopped
all loans to Nicaragua in 1982. (27)
By 1993 when the Reagan-Bush period ended, "the South had been
transformed" by the LIC-FLIC combination. Radical governments and
liberation movements had been defeated, overthrown or compromised, the
state's role in the economy had been drastically reduced, government
enterprises had been privatized on a massive scale, limits on foreign
investment and protectionist barriers to Northern imports had been
removed (ensuring an open market) and the emphasis on export growth had
integrated Third World economies into the global capitalist system as
raw material suppliers. (28) Even Vietnam was under World Bank-IMF
tutelage. The World Bank and the IMF thus proved to be extremely
effective instruments of U.S. policy: their neocolonization of the
Third World through SAPs ensured that 80% of humanity would remain
servants of the West.
ADJUSTING AFRICA
According to the UN Economic Commission for Africa (ECA) "the major
thrust of economic policy making on the continent has been informed for
the last decade or so by the core policy content of adjustment programs
(of the type supported by the IMF and the World Bank)."(29) The New
York Times called the World Bank and the IMF, "the overlords of
Africa." Beginning in 1980, SAPs have been imposed on 36 of Sub-Saharan
Africa's 47 countries.(30) As a result of SAPs, Africa is more
integrated into the global economy than ever. SAPs' emphasis on export-
led growth has significantly expanded African trade levels. From 1989
to 1999, Sub Saharan Africa's trade as a percentage of GDP (a key
indicator of globalization) increased from 78.1% to 95.6%; in dollar
terms, trade grew from $175 billion in 1990 to $187 billion in 1999;
for the same period, foreign direct investment jumped from $923 million
to $7.9 billion in 1999 and portfolio investment (for equity) shot up
from $2 million to $3.9 billion; debt service increased from 12.9% to
13.9% of exports. Only official aid to Sub Saharan Africa fell from
$19.4 billion in 1994 to $12.5 billion in 1999.(31) But contrary to
World Bank dogma, export expansion and rising foreign investment in
Africa have not increased growth or reduced debt and poverty-in fact,
as seen below, they have had exactly the opposite effect. Most African
exports are raw materials and non-oil commodity prices have dropped by
35% on average since 1997.(32) Foreign investment contributes little to
African economies due to incentives given to the companies such as tax
holidays and profit repatriation allowances. After considerable social
and economic progress during 1960-1980, the following 20 years of
structural adjustment have devastated the continent.
Impacts of Adjustment
- Slower Growth
During 1960-1980, Sub Saharan Africa's GDP per capita grew by 36%; in
the 1980-2000 period it actually fell by 15%. As the Center for
Economic and Policy Research puts it, "These are enormous differences
by any standard of comparison and represent the loss to an entire
generation - of hundreds of millions of people - of any chance of
improving its living standards."(33)
- Increased Poverty
According to the World Bank, in 2003, over 350 million people (more
than half of Africa's population of 682 million) lived below the
poverty line of U.S.$ 1 a day, a 75% increase over the 200 million
figure for 1994.
- Lower incomes
Africa's estimated per capita income in 1990 was at the same level it
had been in 1960. Per capita incomes for most Sub Saharan countries
fell by 25% during the 1980s and for 18 countries these incomes were
lower in 1999 than in 1975. In 1960, Sub-Saharan Africa's per capita
income was about 1/9 of that in high-income OECD countries; by 1998, it
had deteriorated dramatically to about 1/18.
- Low Human Development Indicators
According to the UN Development Programme (UNDP), 80% of low human
development countries - those with low income, low literacy, low life
expectancy and high population growth rates - are in Africa.(34)
Average life expectancy for Sub Saharan Africa is only 47 years (the
lowest in the world), a drop of 15 years since 1980. Forty per cent of
the population suffers from malnutrition that causes low birth weight
among infants and stunts growth in children. In 2000, 30% of children
under five were underweight in Sub-Saharan Africa; thirty-seven percent
of such children were under height.(35)
- Increased Debt Burdens
Under SAPs, Africa's external debt has increased by more than 500%
since 1980 to $333 billion today. SAPs have transferred $229 billion in
debt payments from Sub-Saharan Africa to the West since 1980. This is
four times the region's 1980 debt. In the past decade alone, African
countries have paid their debt three times over yet they are three
times as indebted as ten years ago. Of Sub-Saharan Africa's 44
countries, 33 are designated heavily indebted poor countries by the
World Bank. Africa, the world's poorest region, pays the richest
countries $15 billion every year in debt servicing. This is more than
the continent gets in aid, new loans or investment. Jubilee 2000 U.K.
warns that "Foreign indebtedness now poses a fatal impediment to
Africa's development." In 1997, the UNDP stated that in the absence of
debt payments, severely indebted African countries could have saved the
lives of 21 million people and given 90 million girls and women access
to basic education by the year 2000. The All-African Conference of
Churches has called the debt "a new form of slavery, as vicious as the
slave trade." According to Africa Action, a Washington D.C.-based
advocacy group,: "The U.S. appears unwilling to support debt
cancellation for Africa because the U.S. actually gains a great deal
from Africa's economic enslavement. The U.S. and other rich countries,
as well as the World Bank and IMF, use Africa's debt as leverage to
manipulate the continent's economic fate to serve their interests."(36)
- Decrease in health care and increase in disease:
Africa spends four times more on debt interest payments than on health
care. This combined with cutbacks in social expenditure caused health
care spending in the 42 poorest African countries to fall by 50% during
the 1980s. As a result, health care systems have collapsed across the
continent creating near catastrophic conditions. More than 200 million
Africans have no access to health services as hundreds of clinics,
hospitals and medical facilities have been closed; those remaining open
were generally left understaffed and without essential medical supplies.
(37) This has left diseases to rage unchecked, leading most alarmingly
to an AIDS pandemic. With about 12% of the world's population, Africa
accounts for 80% of the world's deaths due to AIDS and almost 90% of
the world's deaths due to malaria. More than 17 million Africans have
died of HIV/AIDS and an estimated 28 million of the 40 million people
living with the disease worldwide are in Sub- Saharan Africa. More than
12 million African orphans have lost their mothers or both parents to
AIDS. Presently, Malaria is killing 900,000 people annually across the
continent and according to the World Health Organization (WHO) 3.3
million Africans will have tuberculosis by 2005.(38)
- Lack of clean drinking water:
More than half of Africa's population is without safe drinking water
and two-thirds do not have access to adequate sanitation. 39 Water
privatization schemes in Ghana and South Africa are further depriving
poor people of access to potable water.
- Decrease in education levels:
Ten African governments spent more on debt repayments than on primary
education and health care combined in 2002. Forty percent of African
children are out of school and Africa is the only region where this
number is rising.
Between 1986 and 1996, per capita education spending fell by 0.7% a
year on average. The adult literacy rate in Sub-Saharan Africa is 60%,
well below the developing country average of 73%.(41) More than 140
million young Africans are illiterate.(42)
Given the horrifying social impact of SAPs all over Africa, it is not
surprising that Emily Sikazwe, director of the Zambian anti-poverty
group "Women for Change," asked: "What would they [the World Bank and
the IMF] say if we took them to the World Court in The Hague and
accused them of genocide?"(43)
HIPC
In response to public demands to address the debt crisis of poor
countries and provide debt relief, the World Bank and the IMF
introduced the Highly Indebted Poor Countries (HIPC) initiative in
1996. This has been seen as a failure due to the limited debt relief
provided and its SAP requirements. Countries must successfully complete
six years of structural adjustment before they become eligible for debt
relief under HIPC. By the end of 2000, the 22 countries promised debt
relief under HIPC had their debt reduced by $34 billion which is
equivalent to only 8% of the total debts of the 52 low income countries.
(44) For Mali and Burkina Faso, an internal World Bank-IMF report
projects that debt service payments will actually increase after debt
relief under HIPC.(45) As Jubilee 2000 put it, "The HIPC is failing
because it is a creditor-controlled process, designed to limit creditor
losses, while increasing creditor leverage over HIPC countries. Its
objective is not debt sustainability for poor countries, but rather to
limit losses for rich countries."(46)
PRSPs
In another attempt at repackaging structural adjustment, the World
Bank and the IMF introduced Poverty Reduction Support Papers (PRSPs) in
2000 which were supposed to transform SAPs into poverty reduction
programs established by national governments who would consult with
civil society in writing the PRSPs. However, country experiences with
PRSPs show that the essence of SAPs has not changed; SAP orthodoxy is
being grafted on top of PRSPs. This is confirmed by John Page of the
World Bank who explained: "The PRSP is a compulsory process wherein the
people with the money tell the people without the money what to do to
get the money."(47) A recent report on the PRSP process in Uganda found
that "Ugandan NGOs were invited to provide input on the development of
the poverty-reduction goals, but not on the nature of the policies to
achieve those goals." The IMF publicly claimed that "key macroeconomic
policies, including targets for growth and inflation, and the thrust of
fiscal, monetary, and external policies, as well as structural policies
to accelerate growth, [would be] subjects for public consultation;"
these consultations, however never took place in Uganda. The PRSP loan
policies "were determined by the IMF and World Bank representatives in
consultation with small technical teams within the Ministry of Finance
and the Central Bank." (48) The Case of Uganda, April 2002, pp. 4-5.
ZIMBABWE
During the 1980s, Zimbabwe's economic growth rate averaged about 4% a
year. It's exports were increasingly manufactured goods, debts were
regularly repaid, food security was attained, and education and health
services were greatly expanded by major increases in government
spending. Consequently, the infant mortality rate fell from 100 per
1,000 births to 50 between 1980 and 1988 and life expectancy increased
from 56 to 64 years. Primary school enrollment doubled.(49)
Zimbabwe implemented structural adjustment in 1991 when it signed an
agreement with the IMF in exchange for a $484 million loan. The
government turned to the Fund in an effort to "jump start economic
growth" after several years of economic stagnation. The IMF's SAP for
Zimbabwe required reducing trade tariffs and import duties, eliminating
foreign currency controls, removing protections for the manufacturing
sector, deregulating the labour market, lowering the minimum wage,
ending employment security, cutting the fiscal deficit, reducing the
tax rate and deregulating financial markets.(50) These measures brought
"massive closings of companies," leading to increased poverty and
unemployment. The Zimbabwean economy went into recession in 1992 when
real GDP fell by nearly 8%. Twenty-five percent of public workers were
laid off and unemployment reached between 35% and 50% in 1997. By 1999,
68% of the population was living on less than $2 a day and with the
collapse of wages many workers lived far below the poverty line.(51)
Manufacturing production "has been the main victim of liberalization
policies" it's share of the GDP falling to 16% during the 1990s for the
first time since 1960, compared to an average of 25% during 1970-1990.
Manufacturing output declined more than 20% between 1991 and 2000 due
to high interest rates and the cost of foreign currency. The sector has
stagnated since the introduction of the SAP and the loosening of import
controls, and the 1990-97 period has been characterized by "a lack of
industrial development."(52) Zimbabwe's real GDP per capita fell by
5.8% during 1991-1996 and total private investment fell by 9% between
1991-96. During the same period, private per capita consumption dropped
by 37%. "This alone transformed the group of those who lost from the
reforms from a minority to a majority."(53) Employment growth in
manufacturing fell from 3% during 1985-1990 to -3% in 1999-2000.(54)
Real wages declined by 26% between 1991-96 to the point where even
those with full-time jobs were no longer guaranteed a living wage; food
prices rose faster than other consumer prices, having the greatest
impact on the rural poor.(55)
Farmers have been hurt by high interest rates, the removal of
subsidies on agricultural inputs and a reduction of government spending
on roads and transport systems. The price of fertilizer has shot up
300% in five years leading to the drastic reduction of acreage under
cultivation. Trade liberalization has resulted in a shortfall in maize
production (required for human consumption and livestock feed) which
experienced a persistent surplus before 1991. (56)
The IMF required that Zimbabwe reduce non-interest expenditures by
46%. Though the government never met this incredible target, health
care spending under the SAP fell to to 4.3% of the budget in 1996 from
6.4% in 1990. The per capita budget for health care fell from U.S.$22
in 1990 to U.S.$11 in 1996. As the SAPRIN study states "[Zimbabwe's]
public health budget is not enough to meet health needs. The per capita
budget has fallen since 1991 to a level where it does not even pay for
prevention, clinics and district hospital costs per capita." Education
spending also declined significantly under the SAP by 36% and 25%
respectively for primary and secondary education between 1990-94.
Teachers' wages fell by at least 26% during 1990-93.(57)
The establishment of user fees for health care services led to
dramatic cost increases for patients "in some cases exceeding 1000%."
This has resulted in "a serious negative impact on the utilization of
health care services in both rural and urban areas particularly for the
poor." The drop in health care spending has caused a 30% decline in the
quality of health care services. Twice as many women were dying in
childbirth in Harare hospitals in 1993 than before 1990. High rates of
stunting and wasting in children under five were found in 1998
especially in rural areas. Infant and child mortality rates have also
been increasing and life expectancy at birth has dropped from 61 to 48
years. By 1995, the number of cases of tuberculosis had quadrupled. As
a Harare newspaper put it, "In the context where the HIV/AIDS pandemic
is claiming 1,700 people a week....the deplorable state of the health
delivery system could be seen as a bombshell of seismic proportions."
One fourth of Zimbabwe's population is infected with HIV/AIDS.(58)
The IMF's fiscal demands have thus created a health care crisis in
Zimbabwe and reversed "the previous trend of improving health outcomes."
(59)
Similarly, the introduction of user fees in education has "led to a
dramatic increase in dropout rates." By 2000, only 70% of children
completing primary school were going on to secondary school and the
fourth and final year of lower secondary school had an average dropout
rate of 92% for males and 93.4% for females during 1990-97.(60)
SAPs emphasize export-led growth in order to generate foreign currency
to reduce debt. However, trade liberalization in Zimbabwe's case (and
that of many other countries) has led to imports growing more than
exports; this has raised trade and current-account deficits thereby
significantly increasing the country's debt burden.(61) Overall,
structural adjustment in Zimbabwe has gutted an economy making rapid
progress before 1991. The SAP has destroyed Zimbabwe's productive
capacity(62) causing massive unemployment and poverty; the reforms have
further impoverished Zimbabweans by denying them access to health care
and education.
GHANA
Structural adjustment has had a similar impact on Ghana where it was
first implemented in 1983 under a military government. Seen as a "star
pupil" by the World Bank and the IMF, Ghana privatized more than 130
state enterprises(63) including the mining sector (its main source of
revenue), removed tariff barriers and exchange regulations and ended
subsidies for health and education. As a result 20% of Ghanaians are
unemployed and the cost of food and services has gone beyond the reach
of the poor.(64) GDP per capita was lower in 1998 ($390) than it was in
1975 ($411); 78.4% of Ghanaians live on $1 a day and 40% live below the
poverty line; 75% have no access to health services and 68% none to
sanitation.(65) As with Zimbabwe, the World Bank's emphasis on export
expansion to reduce debt has only increased Ghana's external debt from
$1.4 billion in 1980 to $7 billion in 1999. This has made Ghana subject
to the World Bank's Highly Indebted Poor Countries (HIPC) initiative.
(66)
In agriculture, Ghana used to be self sufficient in rice but the World
Bank insisted that subsidies had to stop and markets had to open. As a
result, the Katanga valley, once Ghana's rice bowl now lies fallow and
U.S. rice has become the staple for Ghanaians. Why is this? Because U.
S. rice is subsidised and therefore cheaper than that grown in Ghana.
(67)
The introduction of user fees for health care in 1985 combined with
falling wages and increasing poverty has reduced out-patient attendance
at hospitals by a third especially in rural areas. As one observer put
it, "Patients pay for everything - for surgery, drugs, blood, scalpel,
even the cotton wool." This is what the World Bank calls "full cost
recovery" and it has priced the poor out of hospital care. Those who
use services and cannot afford to pay such as Betty Krampa, who gave
birth in Tarkwa General Hospital, are kept prisoner until the fees are
collected.(68) User fees in education have raised the primary school
drop-out rate to 40%. Sharp fee rises at the secondary and again at the
college level have led to only one in 400 Ghanaians being enrolled at
post secondary institutions. As the SAPRIN study notes, "User fees have
led to increasing inequalities both between and within communities as
the poor are left behind."(69)
Ghana's SAP experience has been particularly damaging in the areas of
mining sector reform and privatization of water. Gold mining is Ghana's
main source of revenue and foreign exchange. In 1998, gold exports
totalled $793 million which was 46% of gross foreign exchange earnings.
(70) Under the SAP, beginning in 1986, there has been massive
privatization of the mining sector accompanied by generous incentives
for companies which include the repatriation of up to 95% of their
profits into foreign accounts and the ending of income tax and duties.
Environmental regulation has been minimized. Such a favourable
investment climate has attracted multinational corporations and boosted
production. Seventy to eighty-five percent of the large-scale mining
industry is now foreign owned (the government owned 55% of all mining
companies before 1986) with more than half the 200 active concessions
belonging at least in part to Canadian companies. Ghana is now Africa's
second largest producer of gold after South Africa and gold constitutes
more than 90% of the total value of minerals output. Gold production
reached a record high in 1995 and has since gone up by a further 45%.
(71)
All this has, however, not benefited the Ghanaian economy and people.
As the SAPRIN study states: "liberalization, deregulation and
privatization of the mining sector have enabled transnational
corporations to remove resources and profits from poor countries while
failing to generate sustainable economic growth that is of net benefit
to national or local economies." Due to the tax breaks and incentives
given to foreign companies, mining's net foreign exchange contribution
to Ghana's economy has been minimal. The sector's contribution to
government revenue has also been small at 14.4% in 1995. Mining's
ability to generate employment is also limited given that all
operations are of the surface-mining kind which is capital-intensive.
The sector employs about 20,000 people but privatization and the
decline in commodity prices has led to cost-cutting which has meant
massive layoffs; many mines substantially reduced their labour force
particularly during 1997-2000. At the same time mining has caused high
unemployment in surrounding communities by taking away large tracts of
land from farmers and not providing enough jobs to make up for the
number of people laid off from agriculture.(72)
The district of Tarkwa which contains half of Ghana's large mines
shows the enormous social and environmental impact of the gold boom.
Mining here displaced 30,000 people during 1990-98, contaminated rivers
and streams and destroyed farm and forest lands. Two-thirds of the land
in Tarkwa has been sold off to multinationals with minimal compensation
to local owners. The dislocation effects "every aspect of the social
fabric" and has led to high levels of prostitution, a rise in the
incidence of AIDS, family disorganization and unemployment as people
lose their farms. The police have intervened when people have refused
to leave and demanded fair compensation from the company for their lost
land, crops and home. In December 1999, police shot and wounded nine
people during demonstrations against the lay off of 1,000 workers by
Goldfields (Ghana) Limited (18.9% owned by IAMGOLD Corporation of
Toronto). (73)
Air and water pollution stemming from mining operations in Tarkwa have
spread malaria, tuberculosis, silicosis, acute conjunctivitis and skin
diseases. The mines use cyanide heap leach technology which involves
spraying cyanide on ore to extract gold. The dams used to hold the
cyanide in tend to fail. In June 1996, a spill at Teberebie Goldfields
sent 36 million litres of cyanide solution into the Angonaben stream, a
tributary of the Bonsa River. Cocoa crops and fish ponds were destroyed
and local people complained of rashes. The affected farmers sued the
company for compensation in 1997 and the case continues.(74)
Not satisfied with mining's destruction of forestry, the World Bank
has pushed the government to intensify commercial forestry. Timber
production more than doubled between 1984 and 1987, speeding up the
destruction of Ghana's already diminished forest cover, which is now 25
percent of its original size. Ghana is expected to soon become a net
importer of wood from being a net exporter.(75)
The SAP has denied Ghanaians not only their most lucrative resource
but also their most basic and necessary one: water. The World Bank has
decreed the privatization of Ghana's water supply for the purpose of
"increased cost recovery" (as with health care and education) arguing
that a debt-laden government should not subsidize water and sanitation
(never mind that many industrialized countries do). Instead, consumers
will have to cover the costs of operating, maintaining and expanding
water services. This will mean higher water rates for people who have
already been made amongst the poorest in the world by the World Bank's
SAP. Thirty-five percent of Ghanaians lack access to safe water; poor
and very poor households who have no water pipes laid to their
residence make up 50 to 70% of Accra's (Ghana's capital) population.
These households buy water or get it from untreated hand-dug wells. As
Rudolf Amenga-Etego of the Integrated Social Development Centre in
Ghana explained: "Most people in Accra do not earn the minimum wage
[5,000 cedis a day] and a significant number have no regular
employment. An average price for a bucket of water which used to be 400
cedis rose to 800 cedis following an over 100% increase in water and
electricity tariffs announced on April 20, 2001. Privatization is
expected to increase water tariffs even further. The current water
tariff rates that the government of Ghana and the World Bank think are
below the market rate are already beyond the means of most of the
population. So how will the population possibly be able to absorb a so-
called "open market" price in the context of privatization?...As water
becomes less affordable, it is highly likely that there will be a
corresponding increase in diseases stemming from reduced access to
clean water."(76)
The water privatization process in Ghana has been marred by scandal
and accusations of corruption. In 2000, the government awarded the
contract to Enron/Azurix, a consortium of British and American
companies. Enron, the biggest bankruptcy in U.S. history, is now of
course a byword for fraud and corruption. The contract had to be
withdrawn due to public protest in reaction to allegations that a $5
million kickback had been paid to the Minister of Works and Housing.
The bidding process was started again but remained untransparent. Two
of the corporations bidding for the water service, Lyonnaise des Eaux
and Bouygues/Saur have annual sales larger than Ghana's GDP which
limits government influence over them. Both these companies have been
dogged by corruption scandals in France and Lesotho.(77) Joseph
Stiglitz, former Chief Economist at the World Bank, called
privatization, "briberization." He spoke of "national leaders told to
sell their countries' water and electricity companies, who were keen to
get commissions paid into Swiss bank accounts." As he put it, "You
could see their eyes widen" at the prospect and "objections to selling
off state industries were silenced."(78)
Clearly, the World Bank's structural adjustment of Ghana is a textbook
example of how to ruin a country. The ruthless denial of mineral
wealth, food, medical care, education and even water has made the
population destitute spectators to the plunder of Ghana by foreigners.
COTE D'IVOIRE
After two decades of economic growth starting in 1960, Cote d'Ivoire
experienced economic decline in the 1980s due to falling world prices
for coffee and cocoa, its main exports. The country came under World
Bank/IMF structural adjustment in 1989. Under the SAP, Cote d'Ivoire
was required to cut government spending by 30%, capital expenditures by
15%, increase taxes, privatize state enterprises, deregulate the labour
market, reduce the civil service, eliminate price controls, devalue the
currency.and enact trade and financial reforms.(79)
As one observer put it, "the social impact of IMF structural
adjustment on Cote d'Ivoire was severe." During 1989-1993, per capita
GDP fell by 15%. "Between 1988-1995, the incidence and intensity of
poverty doubled, with the number of people earning less than $1 a day
increasing from 17.8% of the population to 36.8%. In the largest city,
Abidjan, the rate of urban poverty rose from 5% to 20% between 1993 and
1995. During 1990-1995, public spending on education fell by more than
35% and that on health fell slightly. By 1995, only 45% of girls from
the poorest quintile of households were getting primary education. The
enrollment rate at the secondary level fell from 34% to 31% between
1986 and 1995. After user fees were mandated for the public health care
system by the IMF in 1991, many health problems deteriorated. The
incidence of stunted growth in children shot up from 20% in 1988 to 35%
in 1995. A study of the SAP carried out by Harvard University concluded
that "the required reductions in public expenditures were imposed on a
system which was already failing to meet basic social needs." As with
Zimbabwe and Ghana, structural adjustment only increased Cote
d'Ivoire's external debt which grew by $3.7 billion during 1989-1991.
According to the Harvard study, Cote d'Ivoire's external debt increased
from 132.4% to 210.8% of GDP.(80)
A horrendous consequence of increased poverty in both Cote d'Ivoire
and Ghana has been the encouragement of widespread child slavery. Cote
d'Ivoire is the world's leading cocoa producer with 40 percent of
global output and Ghana ranks second. Those who own the countries'
large cocoa plantations use children to clear land for the planting of
cocoa trees, and for weeding and harvesting crops. The boys and girls
who are as young as 7 years are unpaid or paid "pitiful amounts." Cocoa
is used to make chocolate and also in the beverage industry. According
to a documentary produced by Channel Four in England, 90% of the cocoa
farms in Cote d'Ivoire use child slave labour which harvests most of
the cocoa imported into England from there.(81)
Working conditions for the children have been described as "akin to
hell." They include twenty hour work days (seven days a week),
malnutrition, the threat of physical, psychological and sexual abuse as
well as poisoning by chemicals. The story of 'ID' (which he related
when he was 15) is typical: "Our day began at 5 am. Carrying heavy
tools on our head, we had to walk six kilometres through mud and stones
in bare feet to reach the fields. By the time we reached them we were
soaked through and exhausted. Once we arrived the overseer showed us
the area we each had to plant before the day's end. We were afraid of
what he would do to us if we could not finish the work. This threat and
the threat of being denied food if we could not finish in time forced
us to work quickly. The work was hard and bending all day gave us back
pains. If we were ill and couldn't work we were afraid that we would be
tortured to death. One day I witnessed two of my colleagues being
tortured for trying to escape. They became seriously ill and died."(82)
The children's parents are compelled by poverty to sell them to
middlemen for as low as $10. The World Bank agrees with UNICEF and the
ILO that poverty is the main cause for this trafficking in children.
(83) According to Anti-Slavery International, "slavery... needs to be
tackled at its source. Poverty and the lack of education and health
care are central to child trafficking's existence."(84) Thus, by
doubling poverty levels and reducing public access to health care and
education in Cote d'Ivoire and Ghana, the World Bank has literally
transformed debt into slavery confirming the statement made by the All-
African Conference of Churches.
--------------------------------------------------------------------------------
CONCLUSION: ALTERNATIVE STRATEGIES
Twenty years of World Bank and IMF SAPs have de-developed Africa and
left it in a state of economic and social collapse. The destructive
effect of these two institutions cannot be over-emphasized. The
elimination of the Bank and the Fund along with the end of SAPs is a
prerequisite for any kind of progress. This needs to be followed by the
total cancellation of Africa's debt. However, the World Bank and the
IMF are not the main problem; they are merely instruments for the
imposition of a U.S. imperial design upon Africa and the rest of the
Third World. Thus in the guise of economic measures, Africa is faced
with a political strategy to recolonize it and therefore must firstly
come up with a political answer. For this the continent needs to draw
upon its anti-imperialist revolutionary tradition personified by
leaders and thinkers such as Patrice Lumumba, Samora Machel, Thomas
Sankara, Kwame Nkrumah, Steven Biko, Frantz Fanon and Julius Nyerere.
Sankara, the late President of Burkina Faso, was overthrown and
assassinated in a military coup after refusing to pay his country's
debt. Shortly before his murder he stated in a speech at the
Organization of African Unity (OAU) Summit in 1986:
The Debt problem needs to be analysed starting from its origins. Those
who lent money to us are the same people who colonised us, are the same
who so long managed our states and our economies; they indebted Afrika
with `donations' of money. We were not involved in the creation of this
Debt, so we should not pay it.
The Debt, moreover, is linked to the machinery of neo-colonialism: the
colonisers became technical assistants; I would call them technical
assassins; and they suggested, recommended to us the financiers; they
told us about the financial advantages. That is why we indebted
ourselves for decades and renounced the satisfaction of our people's
needs. In today's shape, controlled and dominated by imperialism, the
foreign Debt is a well-organised tool of colonial re-conquest: in order
to make the Afrikan economy a slave of those who were so clever as to
give us capital with the obligation of reimbursing them. We are asked
to reimburse our Debt. But if we do not pay, the capital lenders will
not die; if we pay, we will die. We cannot pay; and we don't want to
pay.
We are not responsible for the Debt burden. We have already paid a lot
of the Debt. We are asked to co-operate in researching balance
mechanisms: balance in favour of those who own the financial
institutions and use the power against the peoples. We cannot be
accomplices. The Paris Club is there; let's create the Addis Ababa Club
for cancelling our foreign Debt. Our Club should say: our Debt will not
be paid. Don't think it is a proposal made only by young people like
us. Mrs. Bruntland said Afrikan countries cannot pay, as did Mr.
Mitterand and Fidel Castro. ... we should explain in other conferences
that we cannot pay. We must be united, otherwise, individually we will
be murdered. Avoiding Debt repayment is a condicio sine qua non to
allow us to free resources for our development.(85)
Only a revolutionary, anti-imperialist African leadership can
implement alternative development strategies at the national level.
These leaders would need to be united on a continental basis in their
refusal to pay the debt as Sankara emphasized. Their developmental
agenda would need to include:
(A) Participation:
There is a crucial need for governments to consult their poor
majorities, so damaged by SAPs, about the best development course to
take; development must not remain an "elite" issue. Farmers, workers,
women's groups and students amongst others should be engaged in
discussion and debate and participate in setting economic policy
according to national and regional priorities and not those set in
Washington for the interests of rich Western countries. This will
produce a diversity of solutions for different countries rather than
the irrational uniformity of SAPs. Such dialogue and diversity is the
key to successful development.
(B) Redistribution:
The first task of a radical state must be redistribution of wealth in
order to eliminate poverty and help create a domestic market. Since
most African countries are still largely agricultural this means large-
scale land reform. It also includes official provision of essential
services such as education, medical care, water and electricity, free
of charge.
(C) Promotion of Agriculture:
Land reform should increase production, and generate a surplus for
industrialization. Cheap agricultural imports should be banned in order
to protect farmers and farm inputs should be subsidized and credit
provided.
(D) An industrial strategy:
Industry should be agriculture-linked and aimed at supplying the needs
of farmers. The increased buying power of industrial workers will in
turn provide an expanding market for farm goods.(86) Such a strategy
emphasizes utilizing the productive labour of a country instead of
consigning workers and farmers to unemployment and poverty as SAPs do.
Only the encouragement of productive activity both agricultural and
industrial can generate jobs, income and a rising standard of living.
This will require protecting domestic industry through high tariffs and
import duties as well as stringent exchange controls and strict limits
on foreign investment.
(E) Regional Integration:
This will mean one African market for the continent's manufactured
goods which would lessen its external dependence, promote export
diversification and lead to greater value-added of local products.
Integration will also include setting up cartels for exports such as
coffee and cocoa to ensure a fair price. As one observer put it "The
new approach must also focus on the search for the continent's
collective self-reliance on essential and strategic needs, at the
agricultural and industrial level. For this, it is must be within
African integration, a fundamental framework of sustainable endogenous
development. It is a truism to say that without integration, Africa has
no chance to develop. The vicissitudes of history have made Africa one
of the most fragmented continents in the world. That is one of the
essential factors for its current marginalization."(87)
(F) South-South cooperation:
Greater trade and exchanges and political coordination with the rest
of the Third World will lessen African dependence on developed
countries and strengthen the continent's position in relation to the
West. The Group of 77 now contains133 countries (including many African
ones) which make up 80% of the Earth's population. At the Group's
summit in Havana in 2000, the delegates called for a "new Global Human
Order" aimed at reversing the growing disparities between rich and poor
and giving developing countries much more control over the world
financial system. Many Third World leaders sharply criticized the World
Bank and the IMF for stabilizing poverty.(88)
The Dakar Manifesto stressed that "The need for an approach to
endogenous development proceeds from the basic historical fact that
there is no "universal model", out of space and time, e.g., valid
everywhere and at all time. Development depends on the history, culture
and experience of a people. It cannot be a carbon copy of another
experience, especially one based on a reductionist view of the true
history of the people, full of abiding cultural prejudices and built on
the domination, exploitation and looting of the resources of other
peoples." The conference called for "a vision of development inspired
by the values of the African political, social, cultural, economic and
scientific Renaissance promoted by an African people's consensus. The
fundamental values associated with this Renaissance include restoring
confidence in Africans, rejecting all forms of exploitation and
domination, reinforcing the culture of solidarity and the spirit of
self-reliance, relying on the creative genius of the African people in
order to create a new civilization of autonomous development so as to
bring a great contribution to world civilization."(90)
--------------------------------------------------------------------------------
ENDNOTES
1. Halifax Initiative, "What is the G8?" p. 3; "The World Bank and the
IMF: Walking the Talk of the G7," p. 1.
2. Robert Naiman and Neil Watkins, "A Survey of IMF Structural
Adjustment in Africa: Growth, Social Spending and Debt Relief," Centre
for Economic and Policy Research (CEPR), April 1999, p. 4.
3. SAPRIN, The Policy Roots of Economic Crisis and Poverty: A Multi-
Country Participatory Assessment of Structural Adjustment, April 2002,
Executive Summary, p. 21.
4. SAPRIN, Executive Summary (ES), pp.18-19, Main Report (MR), pp. 173-
74.
5. Teresa Hayter and Catherine Watson, Aid: Rhetoric and Reality,
London, Pluto Press, 1985, p. 66; Halifax Initiative, "The World Bank
and the IMF: Walking the Talk of the G7," p. 3; Bernard Sanders, "The
International Monetary Fund is Hurting You," Z Magazine, July/August
1998, p. 94.
6. Halifax Initiative, op.cit., p. 1.
7. Richard Feinberg et al.,eds., Between Two Worlds: The World Bank's
Next Decade, New Brunswick, N.J., Transaction Books, 1986, p. 2. 0.
8. Halifax Initiative, op.cit., p. 2.
9. Walden Bello, "The Role of the World Bank in U.S. Foreign Policy,"
Covert Action Quarterly, Winter 1991-92, p. 21.
10. Halifax Initiative, op.cit., p. 2.
11. Bello, Covert Action Quarterly, op.cit., p. 22.
12. Ibid, p. 24.
13. Susan George, A Fate Worse Than Debt, London, Penguin, 1988, p.
46.
14. Halifax Initiative, op.cit., p. 2.
15. Halifax Initiative, op.cit., p. 3; George, p. 75; Richard Gwyn,
"IMF Now Defacto Government for Millions," Toronto Star, December 19,
1997.
16. George, pp. 48, 51.
17. Halifax Initiative, op.cit., p. 3.
18. Walden Bello, Shea Cunningham, and Bill Rau, "IMF/World Bank:
Devastation by Design," Covert Action Quarterly, Winter 1993-94, p.
44.
19. Halifax Initiative, op.cit., p. 3.
20. Quoted in John Raymond, "IMF Medicine is Killing Those it Aims to
Save," The Globe and Mail, February 7, 1991.
21. David Schrieberg, "Dateline Latin America: The Growing Fury,"
Foreign Policy, Spring 1997, pp. 165, 173.
22. Asad Ismi, "Plunder with a Human Face: The World Bank," Z
Magazine, February 1998, p. 10.
23. Raymond, The Globe and Mail, op.cit.
24. Bernard Sanders, "The International Monetary Fund is Hurting You,"
Z Magazine, July/August 1998, p. 95.
25. Bello, Covert Action Quarterly, Winter 1991-92, op.cit., p. 25.0.
26. Bello, Covert Action Quarterly, Winter 1993-94, op.cit., pp. 46-
7.
27. Bello, Covert Action Quarterly, Winter 1991-92, op.cit., p. 21.
28. Bello, Covert Action Quarterly, Winter 1993-94, op.cit., p. 47.
29. Naiman and Watkins, p. 20.
30. Walden Bello and Shea Cunningham, "The World Bank & The IMF," Z
Magazine, July 1994; Sanders, Z Magazine, op.cit., p. 95.
31. World Bank, World Development Indicators 2001, Washington D.C.,
April 2001.
32. World Bank, "Making Monterrey Work For Africa: New study
highlights dwindling aid flows, mounting challenges," Press Release,
April 10, 2002, www4.worldbank.org/afr/stats/adi2002/default.cfm ."
33. Mark Weisbrot, Robert Naiman, and Joyce Kim, "The Emperor Has No
Growth: Declining Economic Growth Rates in the Era of Globalization,
CEPR, November 27, 2000, p. 8.
34. United Nations, Development Programme (UNDP), Human Development
Report, 2001; UN, Economic Report on Africa 1999, www.uneca.
org/eca_resources/publications/ESPD;; Remi Oyo, "Africa-Population:
Women Want Bread and Butter Concerns Raised," Inter Press Service,
September 9, 2001, www.iisd.ca/linkages/Cairo/ips004.html; Ismi, Z
Magazine, p. 10; Ann-Louise Colgan, "Hazardous to Health: The World
Bank and IMF in Africa," Africa Action Position paper, April 2002, www.
africaaction.org/action/sap0204.htm. ; James Hall, "Technology Africa:
Poverty an Impediment to Internet Growth," July 18, 2003, Inter Press
Service, http://www.ipsnews.net/interna.asp?idnews=19300
35. UNDP, op.cit.; World Bank, "Making Monterrey Work For Africa...,"
op.cit.; 50 Years is Enough, op.cit.; Colgan, "Hazardous to Health," op.
cit.; Government of Canada, "Building a New Partnership for Africa's
Development," http://g8.gc.ca/summitafrica-e.asp.
36. 50 Years is Enough, "Africa Needs Debt Cancellation, Not More IMF
Programs," www.50years.org/factsheets/africa.html op.cit.; Africa
Action, "Africa's Right to Health Campaign: Debt Cancellation;" Ann-
Louise Colgan, "Africa's Debt - Africa Action Position Paper," July
2001, www.africaaction.org/action/debt.htm; ; Kwesi Owusu, John
Garrett, Stuart Croft, "Eye of the Needle: The Africa Debt Report (A
Country by Country Analysis), Jubilee 2000, November 2000, www.
jubilee2000uk.org/analysis/reports/needle.htm; ;Brahima Ouedraogo,
"Africa: NGOs Preparing for the World Social Forum," Inter Press
Service, January 9, 2002, http://www.corpwatch.org/news/PND.jsp?
articleid=1170; ; Naiman and Watkins, p. 19; Eric Toussaint (CADTM
COCAD,), "Debt in Sub-Saharan Africa on the Eve of the Third
Millenium," ; Jubilee USA, "Status of Debt in Africa: 2004," www.
jubileeusa.org ; Africa Action, "Africa's Debt: Fueling the Fire of
AIDS," http://www.africaaction.org/action/debt2003.pdf ; "Africa's Debt
and Iraq's Debt: Washington's Double Standard," April 21, 2004, www.
africaaction.org
37. Colgan, "Hazardous to Health," op.cit.; 50 Years is Enough, op.
cit.; Government of Canada, op.cit.
38. Colgan, "Hazardous to Health," op.cit.; Alex Kirby, "Water 'key to
ending Africa's poverty,'" BBC News, April 10, 2002,
39. Africa Action, "Africa's Right to Health Campaign: Background
Links on Africa's Health," op.cit.
40. Oxfam Briefing Paper no. 19
41. UNDP, op.cit.
42. Government of Canada, op.cit.
43. Mark Lynas, "Letter from Zambia," The Nation, February 14, 2000.
44. Halifax Initiative, "What is Our Position in Regards to the World
Bank," p. 6.
45. Naiman and Watkins, p. 9.
46. Jubilee 2000, "Progress Report on HIPC - Debt Relief for the
Poorest Countries," 29 October, 2001, www.jubilee2000uk.
org/databank/Briefings/HIPC301001.htm.
47. Halifax Initiative, "What is Our Position in Regards to the World
Bank, p. 6.
48. Warren Nyamugasira and Rick Rowden, New Strategies, Old Loan
Conditions: Do the New IMF and World Bank Loans Support Countries'
Poverty Reduction Strategies?:
49. Naiman and Watkins, p. 9.
50. SAPRIN,(MR) p. 33; Naiman and Watkins, , p. 10.0.
51. SAPRIN (MR), pp. 78-80, 83; Naiman and Watkins, p. 10.
52. SAPRIN, (ES), p. 4, 42, 51.
53. Naiman and Watkins, p. 10.
54. SAPRIN (ES), p. 8.
55. SAPRIN (MR), p. 87; Naiman and Watkins, p. 10.
56. SAPRIN, ES, p. 14; MR, p. 114.
57. SAPRIN, MR, p. 151; Naiman and Watkins, p. 10.
58. SAPRIN, (MR), pp. 74, 158, 162-63; Naiman and Watkins, p. 11.
59. Naiman and Watkins, p. 11.
60. SAPRIN (MR), p. 157.
61. Naiman and Watkins, p. 11; SAPRIN, (ES), p. 4.
62. SAPRIN (ES), p. 20.
63. Asare Kofi, "Ghana-World Bank: Star Pupil Has Second Thoughts on
Reform," InterPress Service, February 17, 1997. ; "Water, Land and
Labour: Impact of Privatization of Natural and Human Resources in the
Poorest Countries, as Compelled by the World Bank and IMF," p. 6.
64. Kofi, op.cit.
65. Rudolf Amenga-Etego, "Water Privatization in Ghana: An Analysis of
Government and World Bank Policies,"pp. 2, 15-16.
66. Kofi, InterPress Service, op.cit.; Ghana Reaches Decision Point
Under Enhanced HIPC Initiative, March 1, 2002, http://www.jubilee2000UK.
org/worldnews/africa.
67. John Kampfner, "Ghana-Prisoner of the IMF," BBC News, November 5,
2001, www.jubilee2000UK.org/worldnews/africa.
68. Kampfner, BBC News, op.cit.; SAPRIN (MR), pp. 155, 158-59.
69. SAPRIN (MR), p. 157.
70. MiningWatch Canada, "Reality Check-The Globalization of Natural
Resources: Mining and the World Bank/International Monetary Fund: A
Special Focus on Ghana," July 2001., p. 3.
71. SAPRIN (MR), pp. 131, 134; MiningWatch Canada, p. 3; Kampfner, BBC
News, op. cit.
72. SAPRIN (ES], p. 15; (MR), pp. 134-135; Mining Watch Canada, p. 3.
73. MiningWatch Canada, op.cit., p. 3; Kampfner, BBC News, op.cit.
74. MiningWatch Canada, op.cit., p. 4; SAPRIN (MR), p. 143.
75. Bello and Cunningham, Z Magazine, op.cit.
76. Amenga-Etego, op.cit., pp. 2, 3, 9-10.
77. Amenga-Etego, op.cit., pp. 11, 13, 15-16; "Water, Land and
Labour...," op.cit., p. 12.
78. "Water, Land and Labour...," op.cit., p. 8.
79. Naiman and Watkins, pp. 12-13.
80. Ibid, pp. 13-14.
81. Matthias Muindi, "The Bitter Taste of Chocolate: Child Labour in
Cote d'Ivoire and Ghana," Africa News, July 2001, www.oneworld.
org/themes/country.
82. Muindi, Africa News, op.cit.; Anti-Slavery International,
"Trafficking of children in West Africa - Focus on Mali and C?
d'Ivoire," June 2001, www.antislavery.org; "Child Trafficking in West
and Central Africa," United Nations Economic and Social Council,
Commission on Human Rights, Sub-Commission on Prevention of
Discrimination and Protection of Minorities Working Group on
Contemporary Forms of Slavery, 24th Session Geneva, 23 June - 2 July
1999.
83. Muindi, Africa News, op.cit.
84. "Governments Agree To Task Force on Cocoa Slavery," May 4, 2001,
www.antislavery.org .
85. Jubilee 2000, "Thomas Sankara, Late President of Burkina Faso on
the Debt," www.jubilee2000uk.org/databank/profiles/burkina0802.htm.
86. Robin Broad and John Cavanagh, "No More NICs," Foreign Policy,
Fall 1988, pp. 99-101.
87. The Canadian Ecumenical Jubilee Initiative, "The Dakar Manifesto:
Africa: From Resistance to Alternatives: Dakar 2000," Dakar, Senegal |
11-17 December 2000, www.ceji-iocj.
org/English/international/DakarManifesto(Dec00).htm#3.
88. "Developing Countries Challenge the Rich," The Globe and Mail,
April 15, 2000; "Third World Urges Global Human Order," Toronto Star,
April 15, 2000.
89. The Canadian Ecumenical Jubilee Initiative, "The Dakar Declaration
for the Total and Unconditional Cancellation of African and Third World
Debt; Dakar 2000: From Resistance to Alternatives," Dakar, Senegal, 11-
17 December 2000, www.ceji-iocj.
org/English/international/DakarDeclaration(Dec00).htm.
90. The Canadian Ecumenical Jubilee Initiative, "The Dakar Manifesto,"
op.cit.M.O<
--------------------------------------------------------------------------------
APPENDIX
Lawrence Summers Memo (on p. 4)
After the memo became public in February 1992, Jose Lutzenburger
Brazil's Secretary of the Environment at the time, replied to Summers:
"Your reasoning is perfectly logical but totally insane... Your
thoughts [provide] a concrete example of the unbelievable alienation,
reductionist thinking, social ruthlessness and the arrogant ignorance
of many conventional 'economists' concerning the nature of the world we
live in... If the World Bank keeps you as vice president it will lose
all credibility. To me it would confirm what I often said... the best
thing that could happen would be for the Bank to disappear."
Lutzenburger was fired soon after writing this letter.
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