The International Monetary Fund as well as the World Bank was successful in evaluating the various areas, which required urgent attention in the public sector reform in Africa. Accordingly, the IMF and the World Bank adopted measures, which would address the problems of the public.
The following paragraphs relate the deficiencies existing in the economy, which necessitated the introduction of public sector reform in Africa. The public sector is essentially the main channel through, which the government performs its duties. The various functions of the government, be it at the state level or at the federal level encompasses jobs pertaining to monitoring, regulating and other spheres of the public sector.
Earlier it was felt that “statism” was the best indicator of development of the economy and to prevent the country from being subjected to social as well as political instabilities.
When the need for the reform was identified:
After recession took place globally during the the 1970s, the country was prone to a lot of economic undulations characterized by decline in trade and socio political hindrances. As such the public sector was distorted at all angles. This necessitated the implementation of public sector reform in Africa. Distortions comprised crisis in finances, rampant corruption, problems associated with debt servicing, more and more workers moved away to other sectors of the economy owing to the inconsistency ruling in the present sector.
In the year 1981, the World Bank published a report, which was referred to as “Accelerated Development in Sub Saharan Africa”, alternatively known as the “Berg report”.
Areas needing public sector reforms in Africa:
The Berg report recognized or realized few trouble zones in the economy.
Improper management of the macro economy pertaining to controlled exchange rates, fiscal deficits, inflation in prices and negative rates of interest were identified as needing urgent attention.
The other area, which required attention includes matters related to import substitution industries, which were nationalized.
Trade management regime also needed urgent attention in the country.
Government expenditure on public service had increased several times, which needed to be well oriented.
The International Monetary Fund in harmony with the World Bank embraced public sector reforms in Africa, which would eventually lead to the stabilization of the African economy.
Last Updated on : 26th June 2013