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Lending Institutions, Health Care, and Human Capital - Research Paper Example

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World Bank and the International Monetary Fund (IMF) are the two leading international lending institutions the world over (Dreher & Gassebner, 2012). They offer large sums of funds in the form of lending to the developing countries most of which are in Africa. These…
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Lending Institutions, Health Care, and Human Capital
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Lending Institutions, Health Care, and Human Capital

Download file to see previous pages... es in the world, with the US coming first, are known to be controlling the World Bank and the IMF as they are the institutions’ primary shareholders. The World Bank, whose headquarters are located in Washington DC, operates on “one dollar, one vote” policy, whereby they say participation in a member country decision making is determined by its financial contribution (Dreher & Gassebner, 2012). US has the greatest influence on decision making in the World Bank with 17% share while a total of 48 sub-Saharan countries, Zambia inclusive, hold less than 9% of the total votes (Dreher & Gassebner, 2012). The G-7 countries hold a record 45% of the World Bank Votes. In this way, it is obvious that these two institutions do act to serve the interest of the rich countries, at the expense of the poor nations. In so doing, they promote neo-liberalism, an economic growth model that is advantageous to the international private sector and the richest countries in entirely.
IMF and the World Bank put pressure on African countries to set in place the Structural Adjustment Programs, SAPs, and other strategies that are aimed at cutting down on government spending on the basic services. Through SAPs, the African states are required to reduce trade barriers and open their markets, keeping their economies as cheap labor sources and producers of cheap raw materials for the multinational corporations (Jerven, 2013). Each of the countries that adopted the SAP, Zambia being one of them, have their stories to tell.
Various problems have emerged right from the year 1985 when SAP was implemented in Zambia, The very early years of its implementation resulted into one of the most unmatched and bloodiest riots ever experienced in the post-independent Zambia (Canale, Liotti & Napolitano, 2014). These riots occurred in December 1986 following the withdrawal of subsidies by the government on cost maize, which is the main staple food of Zambia, as a section of the SAP conditionality on the ...Download file to see next pagesRead More
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