LITERATURE REVIEW
3.7.2 The Moderates (or Liberals)
2. The setting of symbolic rents meant that the governments were not able to recoup their investment to replicate the housing construction process, let alone take care of maintenance. In the end, less and less housing was made available whilst the need for it was going up, opening the system to corrupt practices.
3. Centralised planning, design and housing construction without the consent or consultation of the households led to unsuitable houses being built; the typical socialist concrete high rise tower blocks.
4. State control and protection of the construction (housing market) is said to have killed off the competitive urge of the construction industry hence eliminated the incentive to maximise profit that could have been used to reinvest in housing and national income.
5. Inefficiency in the housing market is blamed on state intervention and state control of the housing market, although Baken and Van der Linden (1993) have argued that this phenomenon (inefficiency) is equally prevalent in housing markets of advanced capitalist states.
No doubt, the Neo-Marxist school has made a positive contribution to the housing and development debate. However its greatest weakness has been its failure to offer an alternative model in the wake of the crippling Third World debt and the resultant economic structural adjustment programme and enabling shelter development strategy.
international financial institutions was prompt and the social action programme was born.
There is now vast literature that shows that the immediate net impact of the Economic Structural Adjustment Programme on poor households in urban communities of Africa is to further reduce their incomes. Even the UNCHS (1996, p.116), in supporting Adjustment polices, have conceded that ESAP has had negative effects on poor urban households.
Although there have long been serious problems with urban poverty in the Southern Hemisphere, it was only in the 1980s that it was given more attention as economic crises and the impact of structural adjustment increased the number of households with incomes below the poverty line and increased the intensity of their deprivation (UNCHS, 1996).
Such findings have only reinforced the arguments against the removal of
government benefits (subsidies) to the poor in the hope that the market will take care of them. Research by Hardoy and Satterwaite (1981) also dispels the criticism that public agencies have failed to provide adequate housing to the public, especially the poor. In a study of seventeen countries drawn from the Gulf region, Africa, Asia and Latin America, they found that only Singapore had almost solved its housing problem with two-thirds of the housing stock provided by the public housing body: The Housing and Developing Board. They drew the conclusion that it was not so much the operation apparatus that mattered but the state of the economy in the success of housing provision. In their comparison of the seventeen countries they found that only Singapore, Mexico and Tanzania had comprehensive settlement policies and political will to tackle housing problems, but yet only Singapore had nearly achieved that using the public enterprise. In the other sixteen countries, the informal sector seemed to fare better. Singapore's economy was then, (1960-1978) the fastest growing amongst the seventeen, at 7.45% per annum.
Week (1993) is another prominent development economist critical of economic structural adjustment and its effects on low-income countries. Writing in the FAO Journal (Ceres, No. 143, September-October 1993), Week (1993) argues that the economic structural adjustment has failed to achieve its intended targets in most of the low -income countries despite the World Bank's policies (The Courier, 1994, p.64). Sinha (1995) has also argued "the outcome of stabilisation and structural adjustment policies, largely based on the neo-classical economic rationale, was justifiable neither in terms of the analytical nor the historical literature". He further goes on to demonstrate how the contradictions in policy and the ideological nature of the host countries have "inhibited successful implementation and accentuated poverty and inequity in developing countries ".
Sinha also questions the theory of free trade as applied to developing countries.
He notes that all developed countries only adopt free trade upon reaching technological maturity, a factor missing in developing countries. He then
wonders, "Why the change in principle?" He is equally unconvinced on the conditional devaluation as he argues;
Currency devaluation in countries dependent on imports of food, machinery and intermediate goods, raised cost of production and the living costs, thus furthering inflationary pressures. Even if such devaluation raised prospects for increased export earnings, a part of the stimulus effect was to undercut by the increase in production costs. Besides the very act of devaluation imposed on debtors an enlarged burden of debt repayment and servicing. Consequently, International Financial Institutions policies became an exercise in debt enhancement rather than debt reduction. Above all, devaluation results in increased costs of living, drastic reduction. Above all, devaluation results in increased costs of living, drastic reduction in government expenditures, and reduction in wages (Sinha, 1995).
This study seeks to explore if truth can be found in this particular condition on the effects of ESAP on the contribution of construction industry vis-a-vis Shelter Development strategy.
3.7.3 Provider and Supporter Paradigms
In as much as government can do to scale up the supply of affordable shelter to low-income people, two distinct paradigms have been operative. The first- provider paradigm is the one that has been dominant in housing history (Hamdi, 1990). It is the one most governments and most housing managers advocate. In the mid- 1980s it privately became popular in Zimbabwe. The second, Supporter paradigm is favoured mostly by fund providers and
academics. It is mostly required by multilateral agencies since it takes control of housing production. This paradigm is the one the Zimbabwe sought to follow by adapting the Shelter Development Strategy under IMF conditionalities. ThUS, the Zimbabwean government had to police the legislature, at the same time be the policy framework maker and enforcer for the private sector's working
environment in the shelter provision. The objectives intended by Zimbabwean government were to:
• Allocate resources for people to organize their own shelter.
• Decentralize resources to support local enterprises and homeownership.
• Fragment shelter production and support smaller builders.
• Integrate development activities and link shelter to larger urban systems of employment and production.
The methodology to be employed to achieve these objectives was:
• Build programmes and allocate resources for small projects.
• Manage resources to increase volume.
• Build fast by building incrementally.
• Promote variety, improvisation, infill sites and services.
The Zimbabwean government had its targeted key actors. These were NGOs CBOs, Small contractors, Informal and formal Community developers,
consultants, families and government agencies. This study will closely examine how this paradigm will work on the Zimbabwean scenario under local
social-economic and political climate in regard to IMF conditionalities.
3.8.0 Summary
This chapter traced the origins and context of the current global phenomenon of Economic Structural Adjustment Programme and the enabling Shelter
Development Strategy and discussed the postulated national development gains in the construction industry, supposed to accrue to the countries applying them.
Preliminary research in some countries does not give conclusive results to generalise the implications of the aforementioned policies and does not give insights of what the future for Sub-Saharan African housing and construction industry holds in light of the Neo-Liberalist policies being applied.