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Conditionality

Commentary

The myths and dangers of PRSPs

8 September 2003

by Demba Moussa Dembele, Forum des alternatives africaines, Senegal

Poverty Reduction Strategy Papers (PRSPs), required by the IMF and the World Bank for access to debt relief and concessional assistance, are loaded with a number of myths that should be debunked.

The myth of ‘national ownership’

According to these two institutions, PRSPs are country-driven and reflect the priorities of each country in its fight against poverty. They insist that PRSPs are drafted through a large participatory process involving the government, civil society organizations (CSOs) and the private sector. But ‘national ownership’ is more theoretical than real. In many cases, CSOs have been frustrated by the process and have found they had been used more as an alibi, or guinea pigs, than considered as genuine partners. Democratically-elected parliaments have been bypassed. And the fact is that African governments put in PRSPs what the Bretton Woods Institutions (BWI) would like to see, rather than what the poor really want. The reason: PRSPs have to be consistent with the BWIs’ preferred policies in order to get their endorsement.

The myth of ‘pro-poor’ policies

There is a big gap between policies that are in the interest of the poor and those that the BWIs consider as sound. The privatisation of public and essential services, like water, health and education, is at the core of the BWIs’ policies and has contributed to spreading poverty. A case in point is Senegal where, because of water privatisation, poor groups in urban areas pay 3 to 4 times more than rich groups. The liberalisation of the country’s groundnut sector, imposed by the BWIs, cost more than 400 jobs following the dissolution of transport company SONAGRAINES, and led millions of peasants and their families to the brink of famine. The Government had to draw up an Emergency Relief Plan to avoid a national catastrophe. Price deregulation and the elimination of subsidies have squeezed the purchasing power of average citizens, leading more than 64% of people surveyed in the Senegalese PRSP to say that their situation has deteriorated over the last five years, a period of supposedly high growth rates.

The myth of ‘poverty reduction’

How, under these circumstances, can the IMF and the World Bank claim that PRSPs aim at reducing poverty? The forced liberalisation of the groundnut sector in Senegal led to a sharp fall in agricultural production in 2002. This, in turn, resulted in the decline of economic growth from 5.6 % in 2001 to an estimated 2.4 % in 2002. This translated into an income loss of roughly $200 million for a country where two out of three citizens live under the poverty line.

In many other countries, local industries have been destroyed by cheap imports in the name of free trade imposed by the BWIs. No wonder in Sub-Saharan Africa about 500 million people live on less than $2 a day. This number is projected to rise to more than 600 million in 2015, despite all the fuss about the Millennium Development Goals. So long as PRSPs, like the now discredited Structural Adjustment Programmes (SAP), are within the framework of the neoliberal model, they will generate more poverty than they reduce.

After spreading poverty at an unprecedented scale in Africa, the IMF and the World Bank are trying to mislead world public opinion, especially in the North, into believing that they are really committed to poverty reduction. Their real mission is to promote the interests of global capitalism by opening Africa’s economies to multinational corporations and financial speculators and by transforming them into markets for Northern countries’ products.

This should be clear to everyone, especially NGOs familiar with these institutions’ philosophy and policies. Yet some Northern NGOs which have been among the leading critics of SAPs and at the forefront of the struggle for debt cancellation, have bought the BWIs’ propaganda. They have found some merits to PRSPs and think that with an emphasis on more spending for social sectors, PRSPs could help alleviate poverty, despite the fact that they leave intact the neoliberal macroeconomic framework. The same NGOs think that the PRSPs provide an opportunity for their partners in the South to influence national policies toward more pro-poor policies. This explains why some big Northern NGOs have literally forced their Southern partners to participate in the PRSP process. This paternalistic attitude has been condemned by numerous Southern NGOs, especially African NGOs, during the last African Social Forum, in Addis Ababa, in January 2003.

A sincere partnership should be based on mutual respect and trust. African and other Southern NGOs are mature enough to know what is best for their people and what course of action to follow. Northern NGOs should respect that choice and support it rather than dictate what they think is best.

In conclusion, what the BWIs are trying to achieve with the PRSPs is to:

  • create the illusion of poverty reduction while continuing the same failed policies;
  • promote a superficial national consensus on short-term poverty reduction programmes at the expense of a serious reflection on long-term development policies;
  • drive a wedge between so-called ‘reasonable’ and ‘radical’ civil society organizations; and
  • shift the blame to HIPC governments and citizens for the inevitable failure of the PRSPs.

We should not walk into this trap!


Comment by Demba Moussa Dembele of Forum des alternatives africaines.