What factors can explain the widespread application of SAP throughout the developing world?.
What were the central components of these programs and what is the evidence of their effect?.
3.Is the general failure of SAP explained best in terms of the weakness of their assumptions or the inability of the recipient countries to embrace them wholeheartedly?.
1.In 20 years after the first oil crisis of 1973, economic progress in much of the developing world has been very poor. With some notable exceptions - for example Botswana, Mauritius, Thailand, Indonesia and of course the East Asian "tigers" - growth was negligible or even negative in many cases. Overall, between 1965 and 1990, the average annual rate of growth of GNP per capita was negative in many African countries, and also in Jamaica, Bolivia, Peru and Venezuela.
Conditions created by the new global competition in industrial goods and later in financial services became increasingly incompatible with the theories that had previously dominated economic thinking, that is Keynesianism in the centres and anti-dependancy import substitution in the periphery. By the same token, these conditions helped resurrect older economic theories. The remarkable comeback of the neoclassical approach to development was hastened by its fit with the new economic realities and by the vigorous actions of its supporters to further that convergence. Largely championed by the Reagan administration and Margaret Thatcher's government, the neoliberal principles that shape SAPs gained prominence in the IFIs in the 1980s. The neoliberal philosophy of economic development revived the old precepts of economic liberalism, which hold that an unregulated free market and private sector are the engines for unrestricted growth, the benefits of which will trickle down from the owners of capital to the entire population. Plant closings and relocations abroad may have been anathema to advocates of a national "industrial policy", but were perfectly compatible with a theory that regarded protected work forces as a constraint on market competition.
