Structural Adjustment, Policy and Administrative Reforms The Impact of International Reforms

Policy Reform The Current State of Management of Policy Reform and Structural Adjustment a. IMF stabilization and trade liberalization b. Currency reform, auctions- end of subsidies (end urban privileges)

Policy Reform c. Market prices for agriculture and industrial goods d. Deregulate the economy e. Most Importantly: Free Trade f. Administrative Reform: Privatization

Policy Reform-Conditionality Conditionality- World Bank and UNDP and the "Management" Team of Resident Ambassadors SAPs- Focus on Policy and Administrative Reforms in return for loan restructuring and foreign aid

Structural Adjustment Problem of debt: Considered a Third World Problem: Jamaica- #1 a. Donor monies drive the system in the degenerated state b. Reagan and Thatcher c End of Cold War and Dismantling of the Soviet Union

Structural Adjustment Second World as new debtors- Chad vs. Russia a. Transitional States-Hungary vs. Mongolia b. Rise of Asia and trade blocks c. Crisis in Asia and their return to debt management

Policy Reforms- Issues 1. Opposing views of many UNDP Representatives (The role of the Resident and Country Plans) 2. The receivership committee: Resident Rep., World Bank Representative and the IMF delegate resident ambassadors 3. Structural Adjustment State looks like colonial antecedents.

Administrative Reforms The New Orthodoxy

Administrative Reforms Stabilization and Conditionality Requirements Public Sector Reform

Administrative Reforms Reform of the bureaucracy a. Cutback the civil service the infamous 19% first cut b. Individual Consultants and Contractors work with investments and the service/commercial sector

Administrative Reforms 1. Strategic Planning and Management 2. Deregulation 3. Performance Management 4. Merit Recruitment 5. Decentralization and Development of Local Government

Administrative Reforms 5. End of Corruption 6. “Reinventing Government”- end to hierarchy and intra- governmental competition 7. Rewards based on Performance

Administrative Reforms Problems with Administrative Reform 1. Departments buy and sell goods & services- statistics or setting up “privatization networks” to acquire state properties. 2.Sub-economic salaries: offices, houses and telephones- buying soap and selling chickens. International salaries for essential workers (Consulting Practices)

Administrative Reforms- Problems 3. Reality- The absence of recurrent budgets 4. Activity (economy) driven by technical assistance projects the only game in town 5. NGOs and for profit contractors and consulting firms take the jobs

Privatization Key Conditionality- Privatization of the economy 1. Bridging and sectoral loans and grants major source of international involvement- Conditioned on privatization

Privatization Forms of Privatization a. divestiture b. contracting out c. liquidation d. sell off public private partnership shares

Privatization e. International conditions for "good" remaining bureaucrats, eg. World Bank Programs- special salaries for those on contract with the project f. Goal: Return to the recurrent budgeting process and balanced budget principles of “Neo-Orthodox Economists” so called PUBLIC CHOICE THEORY g. Public-Private Partnerships- NGOs, Business and a streamlined state