[stop-imf] New studies of Guyana, Senegal economic policy

[Robert Weissman]

Two new studies from the Social Justice Committee show World Bank and
IMF control of economic and anti-poverty programs in Third World
countries to be damaging to government, citizen efforts.

*Guyana: Experience of Economic Reform under World Bank and IMF
Direction <www.s-j-c.net/English/ejustice/publications/GuyanaSenegal.htm>*

*Driving Under the Influence: Senegal's PRSP Process
<www.s-j-c.net/English/ejustice/publications/GuyanaSenegal.htm>*

9 Nov 2005
http://www.s-j-c.net/English/ejustice/publications/GuyanaSenegal.htm

Tight control by the World Bank and IMF resulted in ineffective economic
reform and poverty reduction programs, according to two new studies from
the Social Justice Committee and Halifax Initiative Coalition, Canada.
Control of the policy process by these institutions tended to stir
resentment in the societies the programs were supposed to help, because
of low level of country ownership and civil society participation in
program design and implementation.

The studies of economic policy in Senegal and Guyana, two heavily
indebted poor countries, identified that problems with economic reform
and poverty reduction programs in those countries were due mainly to:
- excessive control by the World Bank and IMF of the direction, scope
and timing of economic reform and poverty reduction programs,
- the low level of actual country 'ownership' of economic policies and
poverty reduction strategies, and
- lack of processes of empowerment and capacity-building of affected
citizens.

The papers point to the need for greater country autonomy in charting
development paths and for greater civil society involvement in the
process. In particular, the papers highlight the continuing lack of full
disclosure of relevant information and the informed consent by people
affected.

The *Guyana* study, by Derek MacCuish, describes the relationship
between the financial institutions and the government to be one of
tension and mutual distrust, with policy decisions taken in a context of
conditions attached by the financial institutions to debt relief and
financial aid, rather than one of mutual respect, shared perspective,
and agreement on objectives. The reform process has tended to be
technocratic and directed by the financial institutions at the expense
of national ownership and the strengthening of civil society capacity.
This contributes to a reluctance to involve and empower civil society
organizations, which remain isolated from decision-making processes and
without effective avenues of engagement.

This isolation weakens key programs like the Poverty Reduction Strategy,
and depriving it of legitimacy in the eyes of civil society. Reforms in
major economic sectors were launched without adequate social impact
assessment or public accountability, while reductions in government
spending sought by the financial institutions were pursued at the
expense of policies of social stability and job creation.

The study of *Senegal*=92s Poverty Reduction Strategy process, by Wendy
Philips, indicates that it suffered from a lack of government capacity,
and a highly protracted and limited participatory process that fell
short of being country owned or country driven. The Senegalese
government responded primarily to the demands of the financial
institutions, resulting in a process that conformed to the
macro-economic prescriptions of the institutions at the expense of local
social priorities and democratic participation.

The Senegal study concludes that progress toward poverty reduction and
national control over development would be strengthened through
increased support to local governments and civil society organizations
to build capacity to carry out and engage in poverty reduction policy
initiatives.

For info, contact Derek MacCuish at the Social Justice Committee -
sjc@web.ca