INTRODUCTION
B. Holding Version of Corporate Organization
VI. FROM CONFLICT TO ORDER OR FROM ORDER TO CONFLICT?
the unions and organized business and within the governing Tripartite Alliance.
It is also clear that influential elements within the major union federation see corporatism as an instrument for working class hegemony.
VI. FROM CONFLICT TO ORDER OR FROM ORDER TO
not be overestimated. The caution applies particularly in the case of a relatively weak economy which is highly dependent on inflows of foreign investment and which is thus sensitive to global economic and political forces. South Africa has been analyzed in overly ideological terms before, but the pragmatists were much closer to the mark. It could be that Cosatu’s militant and ideological face indicates a decline in its power. It could be that the manifest ideological disagreements will be undermined surreptitiously but certainly by the many negotiated agree- ments which are being reached on specific issues at many levels of society, and in Nedlac itself. But there is also the possibility that pragmatism could wither away if the material conditions for its sustenance cannot be created. Then ideol- ogy rules the political process and the prospects for order recede.
ENDNOTE
1. In 1994, the ANC presented the RDP as the basis of its electoral campaign. The RDP originated in the union movement, but went through some revision (from relatively socialist to a position reaching towards neoliberalism before it was released for ‘‘elec- toral approval’’ (see Webster and Adler 1997). In essence, it proposed economic growth, social development, and the redistribution of wealth and opportunities, with the state playing a guiding role in the economy. Analysts disagree whether or not the RDP has any Keynesian elements. See Adelzadeh (1996) and Le Roux (1997).
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4
International Financial Institutions and the Politics of Structural
Adjustment
The African Experience
Mark Owen Lombardi and Sandip Singh Sahota University of Tampa, Tampa, Florida
I. INTRODUCTION
The experience of several developing countries with the IMF supported ad- justment programs seem to indicate that the strategy supported by the IMF is conducive to improved economic performance.
IMF Occasional Paper 1181 But when these general principles get translated into specific programs for action, there seems to be a wide gulf between the fund’s and the African’s diagnosis of the true cause of the malaise, the prescriptions of remedies, the perceptions of how the remedies will work in practice, and the periods within which a more healthy and normal condition will return.
C. M. Nyirabu, Governor, Bank of Tanzania2 As Africa wallows in its second decade of adjustment, the effectiveness of Struc- tural Adjustment Programs (SAPs), commonly advocated by International Finan- cial Institutions (IFIs) is still being challenged. For two decades, numerous Afri- can governments have resorted to agreements with the International Monetary Fund (IMF) and the World Bank that have left them reeling from the shock therapy of adjustment policies.3Today most African states are mired in a cycle of debt, unemployment, capital drain, declining exports, and limited investment as SAPs have thus far failed to adequately respond to Africa’s needs. The result 65
is a grave social, political, and economic crisis as fragile states struggle to halt declining standards of living and the social and political decay that often accom- pany economic collapse.
In addition to the economic burden imposed by SAPs, IFIs (and their West- ern governmental sponsors) linked political liberalization to debt relief and for- eign investment resulting in significant political transformations further destabi- lizing the African political economy. Many African regimes are now grappling with the demands of IMF/World Bank conditionalities that bring short-term eco- nomic upheaval (e.g., rising unemployment, spiraling inflation, reduced state sub- sidies, and decreased currency value) and subsequent political instability while simultaneously heeding calls for political liberalization along Western democratic lines. In several respects Africa now lies prostrate on the operating table of West- ern medicine where the ‘‘cure’’ seems as bad as if not worse than the ‘‘disease.’’
Governments and people across Africa are trying to comprehend how this Structural Adjustment Regime (SAR) will address their daunting economic prob- lems when its effectiveness in halting Africa’s economic decline has thus far been suspect. They are also struggling with political and social reforms amidst an economically unstable environment adding to the sense of disorder and decline that already pervades the African political landscape. How will the two-pronged attack on the economy and the political structure be successful when the intellec- tual linkage of political liberalization and economic development so prevalent in Western discourse remains questionable? How can Africa withstand the
‘‘remedy’’ of SAPs when the very fabric of some societies is splitting apart under the imperious weight of economic collapse? Can Africa find any path out of the SAR in an era of political marginalization by the North and victorious arrogance in the Western capitalist world? Are there avenues of reform and change that can halt the decline and at least give Africans a fighting chance at sustainable development? What are the ways that NGOs, local states, and IFIs can refashion strategies that will meet both economic and political realities in various African societies? It is these and other questions that we attempt to ana- lyze in this paper.
This paper briefly traces the development of the SAR and its central pre- cepts. We then outline the general economic performance of the SAR in the 1980s and ’90s. From this performance, we analyze the politics of adjustment policy focusing on the intellectual linkage of political liberalization and economic re- forms and its fundamental problems in conceptualizing the relationship between NGOs, the State, and the people. Finally, we evaluate the theoretical basis of neo-liberalism and explicate how the theoretical assumptions underlying the SAR are flawed. Our central thesis is that the SAR is flawed at the theoretical level due to its spurious assumptions regarding the linkage of economic and political liberalization along with its orthodox and somewhat antiquated notion of inter- actor relationships within the international political economy.