Structural Adjustment Research Paper

Structural Adjustment

Have Structural Adjustment Programs in Africa met their stated objectives and what have some of the ‘side-effects’ of these policies been?

Since the early 1980s, the World Bank and the International Monetary Fund (IMF) have been actively involved in the management of the economies of many developing countries, including more than forty in Africa.

A definition of structural adjustment can be defined as the process whereby economic policies and relevant institutions are reformed with a view to enhancing economic growth, improving resource allocation, increasing economic efficiency and increasing the economy’s resilience to changes in its domestic or global market. This process is normally supported by policies designed

As a result of these achievements, the World Bank, IMF and Western countries have hailed Ghana as the most successful case of Structural Adjustment Programs in Africa. The implementation of Structural Adjustment Programs in Ghana over this 16 year period has consisted of 6 phases which involved compressing government expenditure through massive cuts in social services and retrenching public sector workers, adjusting the exchange rate through discrete devaluation of Ghana’s currency (the cedi), abolishing domestic price controls, mobilization of government revenue through broadening of the tax base, and the strengthening of tax administration. However, the latter half of this paper will deal with exposing the repercussions of these changes in

The Economic Restructuring Program in Ghana may have succeeded in effecting essential macro-level level changes, however, it has not succeeded in improving the quality of life at a micro-level. Unemployment, poverty and socio-economic disparities have not been alleviated and instead have been worsened. Basic indicators of well-being such as malnutrition and under five mortality rates have not improved very much since the introduction of the Structural Adjustment Programs. Primary school enrolment has dropped, and the percentage of expenditure spent on education and health is still below the level reached before the introduction of the Structural Adjustment Program. While Ghana has managed to achieve a 4-6 percent growth rate throughout most of the adjustment era, Kwadwo argues that it has been projected that the average person will have to wait for 30 years to raise their incomes above the poverty lines whilst some of the poorer will have to wait 40 years. The repercussions of the Structured Adjustment Programs in Ghana are not an isolated case. Wherever Structural Adjustment Programs have been the main staples of economic management, unemployment, poverty and inequalities tend to increase. In the words of an