Social Scientist. v 20, no. 224-25 (Jan-Feb 1992) p. 1.


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Introduction

In the past few years, the slogans of 'structural adjustment* and 'economic restructuring' have come to dominate economic policy discussions. The terms are often used in a deliberately vague manner, or in such a way as to mask the real content of the policies that are being imposed. The importance of altering economic structures, and in particular the way that production and distribution are organized in a society, was highlighted by development economists many years ago. It was then recognized that without major changes in institutions and property relations which affect production, desired patterns of accumulation and distributional goals would not be achieved. However, the current use of 'structural adjustment* refers not to this essential motivation for development, but to a need to change production structures in an economy so as to make it more 'internationally competitive' and allow for enforced balance of external payments. Essentially this amounts to an organisation of the economy which is consistent with trade between unequals, with production and the pattern of trade in the developing country governed by the interests of the developed countries.

This use of the concept has become significant because of its adoption by the International Monetary Fund and the World Bank which use their lending powers to force developing countries to accept policy packages called 'Structural Adjustment Programmes'. These programmes have certain very typical features, which are closely related to the process of economic liberalisation and based on the guiding ideological principle of the primacy of 'free market^ They are usually imposed on economies 'in distress', in which internal and external imbalances have created a situation of mounting debt, foreign exchange shortage and difficulties in meeting even short-run payments. In the past decade, developing countries in these circumstances have been denied access to most forms of external finance other than small amounts disbursed in driblets by the increasingly miserly multilateral financial institutions, the IMF and World Bank. For these rather small inflows of funds, countries in financial stress have been forced to accept policies which fundamentally alter the economic processes within them, and push them into even greater dependence on metropolitan capital over time. This is part of a wider attempt by metropolitan

Social Scientist, Vol. 20, Nos. \-1, January-February 1992



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