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[malefax]

I've been reading "The Fate of Africa", by Martin Meredith -- very interesting history. One of the things that I've gotten from it is the origin of IMF austerity programs. Basically, after African countries gained their independence in the fifties and sixties, they generally instituted presidential one-party systems, which went on to treat the

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[malefax]

Whether the IMF actions in response to the various currency crises in Asia and Latin America helped or just made things worse still seems to be under debate in the intellectual community. It seems clear that Asia and Latin America were much more able to implement the policies, but opinion is divided on whether the policies failed or succeeded, and if they failed whether they were improperly implemented or just a bad idea in the first place.

Reducing corruption and killing money sink state corporations shouldn't be controversial (and isn't, in most circles), but removing tariffs -- in particular currency exchange controls -- and raising interest rates is very divisive. I've heard it argued that Malaysia, for example, recovered relatively quickly from the meltdown exactly because they refused to adopt IMF austerity measures and instead instituted capital controls (including a fixed exchange rate).

It does seem rather suggestive to me that the IMF was pushing the exact same reform package that they had come up with more than a decade previously to deal with structural problems in Africa, to deal with a problem that was triggered by currency speculation and capital outflows.