Somalia had an economy based on trade between small breeders and small agriculture. Despite drought, the country remained self-sufficient on alimentary product during the 60’s and 70’s. During the 1970’s decade population transfer programs permitted the development of an important commercial sector: Breeding. until 1983, breeding represented 80% of Somalia importation takings. At the beginning of the 80’s the IMF and the World Bank imposed a program of reforms. This program led to the collapse of the fragile balance between Nomad and sedentary sector.
One of the goal of this plan was to collect money to refund the IMF and other creditors from several debts. In 1989, the IMF loan was void because Somalia had failed to pay previous interests. Somalia had to comply with the SAP in order to have new loans. The results are well known: The collapse of the state, civil war, famine and finally the intervention of the United Nations and US soldiers (Le des ordre des nations, p 21).
The effects the SAP’s on society are felt by the poorest. For exemple, spending on healthcare has fallen in most of the world’s poorest countries since 1980. In Uganda 4$ is spent per person on healthcare compared with 23$ per person on debt repayment. Because of budget cuts, Sub-Saharan Africa is very vulnerable to basic disease such as Cholera, that are making a come back at a catastrophic pace, owing to the breakdown of water and sewage systems triggered by the economic crisis (Dark Victory, p 55).
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The IMF encourages governments to cut back spending and to downsize government department, thus a rise in employment. the damage in Education Sub-Saharan Africa is significant.
for example the percentage of 6-11 years old enrolled in school has fallen from approximative ly 60% in 1980 to less than 50% in 1990 (web).
The cut in subsidies for farmers is important. Farmers have less mone while they have to compete with the cash crops. Pesticide and herbicide are expensive and debt among the farmers are frequent. Only few rich farmers are able to survive and often work for multinationals. Because poor countries are encouraged to grow mono crops, they cause a glut in International Market and price tend to fall.
Farmers are forced to work for more lower wages than ever. The goals of the SAPs have failed. the world Bank chief for Africa has admitted: “we did not hint that the human cost could be so great, and the economic gains so slow in coming” (Dark Victory, p 55).
Solutions available The World Bank has to reform its structure to be more efficient.
It is important to improve communication between the World Bank and the populations concerned with its policies. Patricia Adams says that “the public is barred from learning about bank designs on their local environment and bank policies for their country’s economy.” Executive directors do not have any restrictions to use their position for personal gain. No police investigation can be made because the World Bank directors have the legal immunity. A solution is proposed by the Jubille 2000 project. Jubille calls for cancellation of the debts of the poorest countries. Mozambique has to pay 33% of its GDP for the repayment of its debts.
This money could be used to improve the healthcare, the education and unemployment. Conclusion SAPs have slowed and decrease the overall development of Sub-Saharan Africa and other countries. The SAPs’s measures have worsened the economic condition.
