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Structural Adjustment Program: Nadim Prince

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STRUCTURAL

ADJUSTMENT
PROGRAM

NADIM 24021
PRINCE 24019
STRUCTURAL • Policies implemented by
ADJUSTMENT the International
Monetary Fund (IMF)
and the World Bank.
• Created with the goal of
reducing the borrowing
country’s fiscal
imbalances.
• SAPs are supposed to
allow the economies of
the developing countries
to become more market
oriented.

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CONDITIONS • CUTTING
EXPENDITURE
• DEVALUATION OF
CURRENCIES
• TRADE
LIBERALIZATION,
OR LIFTING IMPORT
AND EXPORT
RESTRICTON
• PRIVATISATION
• ENHANCING RIGHT
OF FOREIGN
INVESTORS

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HISTORY

1. BRETTON WOODS INSTITUTIONS,


THE IMF AND THE WORLD BANK

2. ORIGINATED DUE TO A SERIES OF


GLOBAL ECONOMIC DISASTERS
 
CRITICISMS

1) PRIVATIZATION
2) AGRICULTURE
3) ENVIRONMENT
4) GENDERED DIFFERENCES
PRIVATISATION

A common policy required in structural


adjustment is the privatization of state-
owned industries and resources.
Ostensibly, this policy aims to increase
efficiency and investment, and decrease
state spending. State-owned resources are
to be sold whether they generate a fiscal
profit or not.

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AGRICULTURE

• The agricultural, anti-land reform and


food trade policies associated with SAPs
have been pointed to as a major engine
in the urbanization of the global South,
the ballooning of megacities, worldwide
migration towards the global North, and
the growth in urban poverty and slums.

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ENVIRONMENT

LOCAL ENVIRONMENTS
C A N E A S I LY B E C O M E
C A S U A LT I E S O F P R O -
TRADE POLICIES.

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GENDERED EFFECTS

P O V E R T Y I S A G E N D E R E D I S S U E . T H AT I S ,
V A R I O U S D I F F E R E N C E S I N C I R C U M S TA N C E S
BETWEEN MALES AND FEMALES CAUSE
V A R I A N C E S I N T H E W AY P O V E R T Y A F F E C T S
E A C H . W I T H T H AT S A I D , S T R U C T U R A L
A D J U S T M E N T P R O G R A M S FA I L TO A D D R E S S
POVERTY AS A GENDERED ISSUE.[

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IMF SAPS’ VERSUS WORLD BANK SAPS’
While both the International Monetary Fund (IMF) and World Bank loan to
depressed and developing countries, their loans are intended to address different
problems.

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IMF SAPS’
IMF LOANS FOCUS ON TEMPORARILY
FIXING PROBLEMS THAT COUNTRIES FACE
AS A WHOLE. TRADITIONALLY IMF LOANS
WERE MEANT TO BE REPAID IN A SHORT
DURATION BETWEEN 2½ AND 4 YEARS.
TODAY, THERE ARE A FEW LONGER TERM
OPTIONS AVAILABLE, WHICH GO UP TO 7
YEARS. AS WELL AS OPTIONS THAT LEND
TO COUNTRIES IN TIMES OF CRISES SUCH
AS NATURAL DISASTERS OR CONFLICTS.

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WORLD BANK SAPS’

World Bank SAPs or Structural


Adjustment Loans (SALs) focus
on providing loans and grants to
countries that provide funding on
a project basis.

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DONOR
COUNTRIES
The IMF is supported solely by its
member states, while the World Bank
funds its loans with a mix of member
contributions and corporate bonds.
Currently there are 185 Members of the
IMF (As Of February 2007) and 184
members of the World Bank

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Thank you

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