Explaining IMF Sectoral Development Policies in Kenya and The Gambia

• In Event: International Relations in Africa

Abstract

This paper explores the nature and determinants of the sectoral development policies pursued under International Monetary Fund (IMF) structural adjustment in Kenya and The Gambia between 1985 and 2000. IMF structural adjustment programs and their impact on development in Sub-Saharan Africa have been the focus of much scholarly research. That research has been primarily focused on the origin and impact of the macroeconomic aspects of structural adjustment programs such as exchange rate, fiscal, and monetary policies. However, structural adjustment programs in Sub-Saharan Africa also entailed policy prescriptions targeting specific sectors of the economy (i.e. agriculture, extraction, and industry), and these sectoral policies had profound impacts on trade, diversification, and economic stability in the countries in which they were implemented. Despite the prominence and importance of sectoral policies in African structural adjustment, the nature and determinants of these policies have received insufficient attention in the structural adjustment literature. I contribute to filling this gap by utilizing primary data sources to quantitatively describe and qualitatively explain structural adjustment sectoral policy choices in Kenya and The Gambia. I first describe sectoral policies in Kenya and The Gambia using an original dataset containing measures of (1) the intensity of focus on the agricultural, extractive, and industrial sectors and (2) the types of policies (e.g. government subsidies, trade reform, etc.) used in each of the three sectors over the structural adjustment period in Sub-Saharan African countries. I then utilize IMF archival material to trace the policy-making process in each of the two countries in order to provide explanations for the observed sectoral development policies. I test four potential explanations for IMF sectoral policies that have been drawn from the African development and structural adjustment literatures: structural conditions, path dependence, neo-colonialism, and African state influence. I find that (1) the governments of borrowing African states exercised significant influence over the formulation of sectoral policies during IMF structural adjustment and (2) that the policies put forward by these governments were primarily driven by the economic and political interests of domestic elites in the borrowing countries.

Author

• Sarai-Anne Ikenze, Lund University