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Structural adjustment: damages, reparations and pathways to non-recurrence.

Jason Hickel1,2,3, Salmaan Keshavjee4,5, Maxine Burkett6

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Summary

Neoliberal structural adjustment programmes (SAPs) implemented by the International Monetary Fund (IMF) and World Bank caused significant harm, including increased poverty and mortality. This paper reviews the damages and suggests reparations and institutional reform for distributive justice.

Keywords:
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Area of Science:

  • Development Economics
  • Global Health Policy
  • International Finance

Background:

  • Neoliberal structural adjustment programmes (SAPs) were widely implemented by the International Monetary Fund (IMF) and World Bank from the 1980s/1990s.
  • SAPs mandated austerity, privatization, and deregulation in numerous countries across Asia, Africa, and Latin America.

Purpose of the Study:

  • To review the evidence of negative impacts of SAPs on human welfare and economic development.
  • To propose options for reparations and distributive justice for affected nations.
  • To advocate for the democratization or restructuring of the IMF and World Bank.

Main Methods:

  • Literature review of empirical evidence on the socio-economic and health impacts of SAPs.
  • Analysis of financial outflows and unequal exchange resulting from structural adjustment.
  • Examination of policy recommendations for institutional reform and reparations.

Main Results:

  • SAPs are associated with declining real wages, increased poverty, and deprivation of basic needs.
  • Structural adjustment led to increased neonatal and maternal mortality and reduced healthcare access.
  • These policies facilitated financial drain from the Global South through unequal exchange.

Conclusions:

  • The IMF and World Bank's SAPs have inflicted severe damages on human welfare and economic justice.
  • Reparations and distributive justice are necessary to address the harms caused by SAPs.
  • Fundamental reform, democratization, or replacement of the IMF and World Bank is crucial to prevent future harm.