Comment by forapurpose | Hacker News Reader

Comment by forapurpose | Hacker News Reader

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Can you back up this claim? My understanding is that, speaking very generally about a large continent, most African countries did not implement the economic fundamentals preached by the World Bank and IMF, but failed to due to corruption and institutional problems, including a lack of the rule of law. What African country adopted the rule of law, open markets, stable monetary policies, a significant reduction in corruption, and failed to prosper?

> the countries that did ignore its orthodoxy, from China in the late 1970s to then India in the early 1990s, prospered

China and India did not at all ignore the 'orthodoxy', but enacted it and that is credited with their economic expansion. China and India adopted capitalism, opened their markets, and adopted economic fundamentals such as stable monetary policy.

It is to my understanding that China was a relative latecomer to the World Bank and has never been a particularly heavy lender from the bank or the IMF, not to the extent that African states were subjected to. And furthermore while China did follow certain strains of the orthodoxy, it retained heavy state control and influence over many sectors and industries, something very few African states were able to retain following the Washington Consensus.

African states on the other hand, about 40 states in the 1980s underwent what we would call Structural Adjustment programs. State owned enterprises were sold, huge slashing cuts were made to education and healthcare(This in part decimated Nigeria's regional class university system), and various legal reforms for the benefit of Western investors. The results of those experiments were generally failed and led to a disastrous late 1980s and 1990s on the continent.

In terms of a country that implemented many of those reforms and failed to get that far. I would say both Ghana and Tanzania are pertinent examples. Ghana has implemented about three to four rounds of IMF engagement since the 1980s and is hailed regionally for its rule of law and stable political and investment climate, it still only has a GDP per capita of $1,641. Then you have Tanzania which since the 1980s has largely abandoned state socialism and embraced a mixed market economy, its GDP per capita? a whopping $936.

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