| | Structural adjustment in Africa is based on neo-classical economic principles derived from the experience of industrialisation in Britain and the United States. Neo-classical economics claims that unregulated markets maximise output across contexts. However, this naturalisation of markets neglects that they are actively constituted by actors with different capabilities and levels of power. Structural adjustment has failed because comprehensive liberalisation has led to the autonomous development of the trade and financial sectors, to the detriment of production. Appropriate development strategies must recognise the necessity of regulating trade and finance in order to channel resources towards production, as in the developmental states of East Asia. However, in order to be successful, such strategies must be embedded in Africa's political economy. Development will require a remaking of both African states and the international financial institutions which dictate their economic policies. |
