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Why do some economies adjust more successfully than others? lessons from seven African countries

Listed author(s):
  • Husain, Ishrat
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    The sustained application of adjustment policies is explicable in terms of two variables - domestic ownership and capacity. These findings carry important implications for the future policies of African governments and their external partners. There is an urgent need for the African governments to go beyond their limited and small groups of technocratic advisers and civil servants to consult, educate, and inform the representatives of the civil society and opinion-makers in the design and implementation of adjustment policies and institutional restructuring. A strong, committed, and visionary leadership that places these policy reforms in the context of the country's long-term development can bond and cement diverse and divergent viewpoints and nurture a shared visionfor the future. For the international financial institutions and external donors who are supporting African governments, the narrow, short-term, and conditionality-driven enforcement and compliance of agreements needs to be replaced by a medium- to long-term framework of macro, sectoral policy, and investment and institutional changes developed and owned by government - keeping short-term capacity as given constraints, but taking measures to develop this capacity within the long-term framework. This framework can then be translated into time-bound, specific action programs on various agreed-on changes between the donors and the African governments. Both the African governments and their external partners have to rethink the measures that will build, save, use, and enhance the capacity of African governments, private sectors, nongovernmental organizations, professional groups, universities, and research institutes. The adversarial relationship between the government and the private sector will have to be transformed into a symbiotic and constructive partnership aimed at achieving the long-term developmental goals. The effectiveness of the present practices of delivering the technical assistance by external donors has been sufficiently questioned, and a new way of delivering this assistance employing capacity building and utilization as the overreaching objective needs to be developed. The transferability of institutions or policies from one setting to another has always proved difficult, but adapting successful practices that have worked elsewhere should be encouraged.

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    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 1364.

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    Date of creation: 31 Oct 1994
    Handle: RePEc:wbk:wbrwps:1364
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