Dr. Gloria Emeagwali

Professor of History and African Studies, Central Connecticut State University, New Britain, Connecticut, USA.



Gloria Emeagwali,"Globalization, Sovereign Debt and Adjustment Programmes in Africa: Implications for Creditors, Debtors and policy Makers in Europe"

in Edward Shizha and Lamine Diallo (eds.)Surrey, England: Ashgate, 2015.


In the first part of the chapter we reflect on sovereign debt, adjustment programs and the interconnections of the latter with globalization. We then examine the origins and application of the adjustment programs deployed in the 1980s and 1990s, in various regions of Africa, namely, the International Monetary Fund (IMF)/World Bank Structural Adjustment Programs (SAPs). We reflect on their theoretical underpinnings and some of the various forms of popular resistance that emerged against those programs, during the era of adoption and implementation. In the second part of the paper we focus on the more recent sovereign debt crisis in Europe and its causes and effects, with particular reference to Greece. Other indebted sovereign countries such as Portugal, Ireland, Italy and Spain would be mentioned in the course of the discussion. Would the adjustment programs devised for European debtor nations, the Economic Adjustment Programs (EAPs), differ from the SAPs imposed on Africa in the 1980s and 1990s? If yes, how would they diverge and why? Would the cause of indebtedness be similar? What impact have adjustment policies had on society, thus far, in the two continents, Africa and Europe? What of popular responses to adjustment programs? Are the reactions in these two regions of the world, similar? What should be done to minimize the negative effects of such policies? Should lenders bear some of the burden of sovereign debt, and, take a �haircut�? Was the African sovereign debt crisis of the 1980s and 1990s, unique in any way? We address some of these issues in this paper. In the first instance, a reflection on the phenomenon of globalization and its links with the IMF and World Bank adjustment programs is presented.

Most current Structural Adjustment and Economic Reform Programs imposed by the IMF and the World Bank have a common international context of origin. In this site we explore some of the various dimensions of the IMF record not only in Africa but also in Asia and the Caribbean because we observe similarities in terms of initial conditions, imposed conditionalities, ideological orientations, implicit and explicit objectives and impact on the countries hosting the IMF programs. These consequences include the following:

  1. Forced devaluation
  2. Forced privatization
  3. A free fall in the value of the domestic currency
  4. Lower purchasing power
  5. A fall in the standard of living
  6. Unemployment and retrenchment of workers
  7. Inflation and the phenomenon of rising prices
  8. Food riots and social unrest
  9. Challenges to trade unions and labor
  10. Substantial challenges to human rights organizations
  11. Increased mortality because of the compulsory removal of subsidies on health
  12. Declines in school attendance along gender lines
  13. Challenges towards democratic governance
  14. The rise and/or consolidation of military dictatorships
  15. De-industrialization as the economies are inundated with cheap foreign products
  16. Reduction in the number of nationals owning industries due to privatization and an invasion of foreign capitalists
  17. Intensified unequal development amongst ethnic groups
  18. Ethnic tension
  19. Transfer of as much as 40% of the domestic budget in debt repayment to the creditors/bankers of Euro-America
  20. De facto loss of sovereignty
  21. The feminization of poverty
  22. Child Labor- reluctantly sanctioned by impoverished/"SAPPED" parents who depend on the child's meager supplement to make ends meet.
  23. The proliferation of terrorist organizations, armed conflict or/and resistance movements- with recruits from the expanding army of the unemployed



The above effects have been documented extensively in Nigeria, Zimbabwe, Zambia, Kenya, Sierra Leone, Somalia, Rwanda and other African countries. In the Caribbean, Jamaica is a classic example. Indonesia and South Korea are among the most recent in Asia. In most instances democratization becomes more and more illusory since dictatorial generals or factions of the army sympathetic to the draconian IMF conditionalities have often seized power. The Babangida coup of 1985 in Nigeria is a great example. This coup has been called "the IMF coup." In Somalia and Rwanda, total chaos and ethnic conflict ensued as the national pie shrunk and unequal development amongst regions and between one ethnic group and another, intensified. The IMF cannot always be blamed for the crises preceding the bailout. In several cases domestic elites plundered the wealth of their countries and engaged in blatant mismanagement of national resources. Often they were associated with the wastage of resources in non-productive prestige projects and siphoned off vital resources to Swiss and other Western banks. We should note, though,that the IMF prescription has seldom helped to solve the crisis and the agents and agencies that seem to gain from its advice are in most cases foreign banking and financial institutions, invariably protected by the IMF.Poor peasants, factory workers and civil servants usually pay the price of the draconian conditionalities imposed by the IMF rescue squad. The organization seems to be unconcerned about the ill effects of its program or 'progrom.' It pushes on with its campaign for the removal of subsidies in poor economies whilst turning a blind eye to the massive use of subsidies in agriculture and the aviation industry, in the United States and Europe.This point was courageously made in Cancun Mexico at the annual meeting of the WTO, a sister organization created in 1995. Ironically enough, it would take a renegade U.S. politician like Donald Trump, in 2016, to rail against globalization, and its signature programs such as trade liberalization.


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Joseph Stiglitz, The seven deadly deficits, Mother Jones , 2008

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Bello,Walden.Deglobalization:Ideas for a New World Economy.Zed Books,2002

Emeagwali, Gloria(ed.), Women Pay the Price: Structural Adjustment in Africa and the Caribbean. New Jersey: AWP, 1995

Emeagwali, Gloria."The Neo-Liberal Agenda and the IMF/World Bank Structural Adjustment Programs with reference to Africa."Dip Kapoor (ed.) Critical Perspectives on Neo -Liberal Globalization, Development and Education in Africa and Asia.Netherlands: Sense, 2011.

Stiglitz.J.Freefall. New York:N.W Norton & Co., 2010


Dr. Gloria Emeagwali, Professor of History and African Studies, CCSU, New Britain, CT06050, USA.