ZAMBIANS have good reason to distrust the IMF. In the 1990s, under the fund’s guidance, their government cut spending, scrapped subsidies, liberalised the exchange rate and privatised over 200 state-run firms. This “structural adjustment” was painful: employment shrivelled and, by the end of the decade, income per person had shrunk by 8%. In the words of Binwell Sinyangwe, a novelist, “they were the years of money first or else no friendship”.
So it was with some trepidation that Zambia welcomed an IMF mission, which concluded on June 10th. As in the 1990s, Zambia has been hit by plummeting prices for copper, its main export. The proposed package, which is likely to be finalised over the coming months, could be worth $1.3bn, which would be the country’s biggest with the fund in two decades.
The retro feel extends across Africa, where GDP grew last year by 1.4%, the slowest rate this century. Ghana agreed on a...Continue reading
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