2000 Fiscal Year Final Research Report Summary
STRATEGIC REBUILDING by the WORLD BANK in STRUCTURAL ADJUSTMENT and TRANSITION POLICIES
| Project/Area Number |
10630061
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| Research Category |
Grant-in-Aid for Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
経済政策(含経済事情)
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| Research Institution | Nihon Fukushi University |
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Principal Investigator |
MOHRI Ryoichi Professor Faculty of Economics, Nihon Fukushi University, 経済学部, 教授 (00113093)
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| Project Period (FY) |
1998 – 2000
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| Keywords | World Bank / IMF / Structural Adjustment Policy / Transition / Globalization / HIPC Initiative / International Financial Crisis / Reform of International Financial Architecture |
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| Research Abstract |
Globalization in the 1990s can be characterized as (a) worldwide financial integration rather than direct investments by multinational corporations, (b) financial globalization has been proceeded with innovation in information and communication technology and IMF/World Bank support, (c) the rapid spread of privatization and transition to market economy, (d) the revival of the US hegemony and globalization of so-called American standard, and (e) the polarization of the world into "the rich and fast, " and "the poor and slow."
Major findings are the followings :
First, the structural adjustment policies implemented by the World Bank and IMF have had mixed results. In Latin American countries in 1990s, debt reduction of Brady initiative and privatization of state enterprises brought huge inflow of foreign direct investment and contributed to economic growth instead of "lost decade" in the 1980s, while the income distribution between the rich and the poor was enlarged. But in low income coun
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tries especially of Sub-Sahara Africa, structural adjustment policies have had few effects to improve the living standard of people.
Second, the rapid transition strategy for Central/Eastern Europe and former Soviet Union by IMF/World Bank brought hyper-inflation and steep drop in production. Central Europe saw the economic recovery with foreign direct investments there, but Russia has been in economic chaos mainly owing to the lack of institutional buildup in which the market economy works, whose importance IMF/World Bank ignored in early period of transition.
Third, East Asian economy stopped booming-up in 1997 owing to the currency/financial crisis. The lesson we learned is that financial liberalization in small open economies with no prudent regulation puts them in vulnerable position through huge inflow and outflow of short-term capital. In addition to the lack of preventive measures, IMF/World Bank forced the crisis countries to adopt belt tightening policies as well as structural adjustment policies which will take several years. The economic conditions were made worse, and the crisis spread into socio-political field in the area as well as world-wide.
Four, from the points mentioned above IMF/World Bank must be restructured to human-faced ones. Structural adjustment policies and transition assistance should take the diversity and indigeneous conditions of assisted area into consideration, respect the ownership of people and civil society. Less
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