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Africa’s Debt and Structural Adjustment Programs

Africa’s Debt and Structural Adjustment Programs. Where does the debt come from? Why is it increasing over time?.

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Africa’s Debt and Structural Adjustment Programs

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  1. Africa’s Debt and Structural Adjustment Programs

  2. Where does the debt come from? Why is it increasing over time? • Trade imbalance: the goods Africa produces/exports not valued as much on world market as goods Africa imports (why? Mainly raw, unprocessed materials; this has changed in the last decade with the increase in the use of mineral wealth, driven by China’s fast-growing economy). • Most aid from Western countries in the form of loans, not grants (Jevanna) • Creditors were the World Bank, and the International Monetary Fund (IMF) • Corrupt leaders who squandered the money on their personal bank accounts • Used for development: Example of Volta River Dam (in Ghana)

  3. Structural Adjustment Programs (SAP) Regulations set by IMF on African governments to increase their debt payments: • Reduce government spending (mainly affected health, education, social welfare) • Invest resources in export products (timber, coffee, copper, etc. privatizing gov. businesses) The Lunda-Ndembu, • p. 311: SAP in Zambia and President Chiluba • p. 315: SAP = Satana Ali Pano (Satan is here)

  4. HIPC = Highly Indebted Poor Countries

  5. Where is the money going?

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