The IMF/World Bank reform package: an analysis
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IMF/World Bank structural adjustment programmes have been widely criticised for their role in worsening the economies of the borrowing countries and deepening poverty among the borrowing country populations. It needs to be emphasised that the need for economic adjustment in developing countries is not at issue here. It is evident that in many developing countries, years of heavy protectionist measures designed to prevent competition for highly subsidised, inefficient local industries undermined initiative, investment and productive potential, while overvalued currencies encouraged imports at the expense of exports. This inevitably increased local industry’s dependence on imported capital goods which undermined markets for local manufacturing companies. It is also evident that gross mismanagement of the economy by local ruling elites, in addition to numerous other global and environmental factors, led to declining economic growth rates, high debt burdens and deterioration of services in most developing countries in general and post-colonial Sub- Saharan Africa in particular.