Africa’s development dilemma – Part II


Abdullahi Borus second article in the three part-article series, where he’s discussing Africa’s development dilemma.


In terms of the overarching policy dominance, the contest between Africa and the World Bank didn’t end with LPA and World Bank, it continued in the late 1980’s. This time round the contest was between AAF-SAP and the World Bank’s Structural Adjustment, with each side trying to express the validity of their arguments. Policy ownership and projection in the case of Africa, has always been hampered by the fact that, as much the policies had valid, the Pan African development initiative has always been the challenged by availability to fund the said policies. In most cases this leads to them capitulating to the externally driven policy, which in most cases doesn’t respond to the local reality. In this second part of the easy, I shall tackle the contest between the World Bank and African states within the framework of The African Alternative Framework to SAP for Socio- Economic Recovery and Transformation (AAF-SAP) and the World Bank’s Africa’s Adjustment and Growth in 1980’s AAF-SAP and World Bank’s Structural Adjustment Program in 1980’s “The contest over development agendas became especially intense and bitter with the introduction of Structural Adjustment Programmed. …the indictment largely stemmed from the, Africa’s Adjustment and Growth in the 1980’s, a publication that the World Bank had put out in 1989 to demonstrate the soundness of SAP Program. It’s allegedly carelessly insensitive attempt to justify the policy prescription of the Breton Woods Institutions appears to have deeply offended the African intelligentsia and policymakers.


800px-World_Bank_income_groups

Blue colour – High income

Green colour – Upper-middle income

Purple colour – Lower-middle income

Red colour – Low income

(Source: commons.wikimedia.org)


Having compared this World Bank report with its own practical experience and midterm review of UNPAARD, they felt that it was openly and crudely manipulative and that it misrepresented the African crisis by focusing on disingenuous explanations and statistical analysis” The thrust of argument of the report was that countries that stringently pursued the World Bank’s prescription have registered more economic growth than those countries that did not. However, this argument was not supported by facts, something the World Bank admitted to in its subsequent reports. “Only seven of the 18 countries with World Bank programs showed improved growth performance, 14 suffered declines in investment rates, and “the impact of these [adjustment] operations is, overall, disappointing,” such that “fewer than 20 percent of the [structural adjustment] projects were substantially effective” (World Bank, 1992, p. 27). Thus, by the mid-1990s, the Bank had accepted the assessment that adjustment had been largely unsuccessful in the sub-Saharan region, and, coincident with this, had redefined adjustment as stabilization” The criticism of the World Bank’s rational was not limited to African leaders alone. Leading agencies like the UN, after years of demurring, disagreed with the World Bank’s assessment. UNECA argued that, contrary to the World Bank’s claims, the non adjusting countries were out performing the adjusting countries. According to the UNECA, for the period 1980-87 “the performance of Sub Saharan Africa with strong Sap’s Programs was the worst of any group; a negative annual growth rate of 0.53 percent contrasted with a positive 2.0 percent for countries with weak SAP programs and a relatively strong 3.5 percent for non adjusting countries in sub-Saharan countries”


In order to see the graphics, download the PDF–->Sourcegood

(Source: IMF Internal Review and H. Bredenkamp, principal author of IMF Internal Review.)


As with LPA, in order to counter the World Bank’s argument, African leaders produced an alternative development paradigm, the African Alternative Framework to Structural Adjustment Programmers for Social Economic Recovery and Transformation and Recovery (f). AAF-SAP was adopted by the African Ministers of Finance and Economic Planning and Development, and endorsed by the Head of States and Governments, the Summit of Non Aligned Countries and United Nations General Assembly in 1989. Just as the Berg report followed the Lagos Plan of Action, Sub Saharan Africa: from Crisis to Sustainable Growth followed AAF-SAP. How does AAF-SAP differ from the orthodox SAP?


“The characteristic of AAF-SAP is that it is human -centered. It distances itself completely from orthodox, mechanistic models or approaches that has reduced the entire business of adjustment to the attainment of a few balances such as a balance of payment equilibrium and reduced government budget deficits without any regard to the implications on the social sectors and the overall welfare of the people”


One of the weaknesses of the SAP was that it is blind to social costs. Because the Breton Wood institutions face no elections like the African governments do, they can afford to ignore the social costs of the proposed policy directions.


The dilemma for African leadership then is, should they follow these stringent measures which they know will result in social cost to their people, or follow an indigenous agenda which they do not have the means of implementing. In this circumstance, they were caught between a rock and a hard place. Many African countries, while opposed to SAP, had to follow them anyway, and the economic and political repercussions were clear. For instance, in Nigeria,

“SAP deepened the division between the military and the civilians, and between ethnic groups as the elite invoked the ethnic identity. Regionalism and religious differences became politicized as elites came under pressure to find a base of power at the time of political anxiety and economic crisis… Nigeria fell into deep political crisis: two presidents disputing political legitimacy, most nationalities demanding a sovereign national conference to reconsider basis for political association in Nigeria, several group seeking a confederation, and a few clamoring for succession” While the SAP is short term and only deals with the economy, AAF-SAP is holistic.

 

“ASAP is a holistic approach to social economic change. Policies should not focus, on a few limited economic variables but should situate the process of change in the whole political and social context…it also means that policy makers should not focus on the short term or long term. Both the long term and short term should be part of the same continuum depending on the prevailing circumstances”


A criticism of SAP is its one strategy fits all approach which recommends readymade, magic bullet solutions. On the contrary “AAF-SAP, only proposes a menu of policies that it believes can select from a design their own specific programmers of adjustment with transformation” This thinking is as a result of the realization that there is no one policy agenda recommendation that can uniformly address unique problems facing different countries.

References:

1. Ake, Democracy and Development, 1996, page 34.

2.Paul Mosley et’al , Assessing Adjustment in Africa 1995.

3.Ake, Democracy and Development, 1996, page 35.

4. Adeneji, Structural Adjustment and Crisis in Africa, Page 19.

5. Ake, Democracy and Development, 1996, page 34.

6. Ibid,page 21.

7. Adeneji, SAPand Crisis in Africa, page 20


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