FAILURE OF BRETTON INSTITUTIONS IN AFRICAN DEVELOPMENT.

The distinguishing characteristic of the low- income countries is that their problems require a

much longer time frame for resolution. On the African region points out that, whereas changing

the structure of an economy is a long-term process, many failed development efforts in Africa

over the last 30 years set unrealistic time frames for reform.

Thus, donors and African governments must maintain the commitment to reform, even where

progress is only modest, particularly in light of the continued low rate of domestic investment.

The typical African economy suffered repeated external shocks- usually repeated declines in the

price of a principal export commodity such as cocoa or coffee. Given the dependence of

budgetary revenues on export taxes, there would inevitably be a budget deficit; and given the

inflexibility of government expenditures in the short-run, this would usually be financed by

inflationary borrowing from the Central Bank.

As a result, structural adjustment programmes have not only failed to produce sustainable

development in poor countries but they have not even succeeded in meeting the more limited

objectives of internal and external equilibrium. Yet the Bretton Woods institutions, infused with

American ideology and Western ethnocentricity, have only marginally modified their policies,

which continue to dominate national policies of recipients.

Some critics pointed out that liberalization policies, and such policies as the elimination of

subsidies for fertilizers, had a negative impact on agricultural productivity and output. Price

reform promoted export crops over traditional food crops. Others argued that export crops
contributed to indebtedness, or that adjustment programs exacerbated unequal land distribution,

promising that “efficient” land markets would replace traditional tenure systems, while

encouraging deindustrialization through “wholesale privatization and unfettered markets” (Sahn,

Dorosh & Younger, 1997: 1-6).

Meanwhile, seven of the ten countries where inequality is most extreme are in Africa and mainly

in Southern Africa. The World Bank twice admits failure poverty reduction has been slowest in

fragile countries and the inhabitants of countries rich in natural resources have the least

favourable indicators of human development.

The weakness of conventional project lending by the Bank in monitoring and disciplining policy

reform was apparent. Most of the projects failed and the Bank blamed the countries for poor

project feasibility. It should be noted, however, that most of the time the Bank teams that

assessed these projects were not familiar with the local conditions, whether institutional setting,

supply chains or political environment.

References

Edward V.K.Jaycox, Vice President, African Region, World Bank, Africa: From Stagnation to

Recovery. World Bank, Feb. 1993, p.9  

Lal Jayawardena   (August 1993) The Bretton Woods institutions and the Development

Problems of The Poorer Developing Countries  . http://www.lfip.org/laws817/docs/c121-

c132.htm#5

Carlos Lopes ( 2012) Economic Growth and Inequality: The New Post-Washington Consensus

https://journals.openedition.org/rccsar/426

Salaheddine Lemaizi 15 April 2016  Poverty in Africa, the unvoiced failures of the World

Bankhttp://www.cadtm.org/Poverty-in-Africa-the-unvoiced

The Hague, June 2005 Helping the Poor? The IMF and Low-Income Countries

FONDAD, www.fondad.org