Social hardships of economic reform

It is generally recognized that the development of human resources both benefits from and contributes to the development process. Effective programmes to promote education and training, science and technology, and popular participation in economic activity, including the participation of women, are therefore key elements in development strategies. However, in many nations struggling with structural readjustment, austerity measures and general recessionary conditions have brought sharp declines in per capita incomes. Unemployment, especially of the young, continues to increase in debtor countries. Hunger and poverty in absolute numbers continue to rise. This forces more people back into subsistence agriculture, where they draw heavily on the natural resource base and thus degrade it. Austerity programmes inevitably include government cutbacks in both the staff and expenditure of new and unproven environmental agencies, undermining even the minimal efforts being made to bring ecological considerations into development planning.

[Developing countries] Debtor developing countries have to bear the burden of arduous structural adjustment with insufficient external support in order to benefit from the facilities offered by the International Monetary Fund in rescheduling their debts. The restructuring required by the IMF is designed to restimulate the economy. However the austerity measures associated with this process include reduction of government spending on: welfare, subsidized food and housing, wages and credit facilities. All these measures impose increased hardships on the poor. They redistribute wealth and opportunities to the wealthy who have capital to invest, in order to encourage them to generate more economic activity, notably exports. These measures tend to have a serious impact on social development and well-being, as education and health needs remain unfulfilled, especially amongst the most vulnerable groups. Human resource development is neglected because although economic growth is a necessary condition for attacking poverty, complementary policies focusing resources and programmes towards the more deprived tend to be given a low priority through force of circumstances. The possibility of addressing serious environmental concerns is also thwarted, thus affecting long-term development prospects. The persistence of acute poverty is another dimension of the problem. Vast poverty persists in Asia. The population living below a minimally acceptable level has increased in Latin America and Sub-Saharan Africa. Many of the countries in Africa which have embarked on programmes of structural adjustment have been unable to sustain them in the face of their immediate social and economic consequences.