Hazardous to Health: The World Bank and IMF in Africa

Hazardous to Health: The World Bank and IMF in Africa

Africa Action Position Paper

By: Ann-Louise Colgan, Research Associate, Africa Action

April, 2002

Part 1

Health is a fundamental human right, recognized in the Universal
Declaration of Human Rights (1948), and the Constitution of the
World Health Organization (1946). Health is also an essential
component of development, vital to a nation's growth and internal
stability.

Over the past two decades, the World Bank and International
Monetary Fund (IMF) have undermined Africa's health through the
policies they have imposed. The dependence of poor and highly
indebted African countries on World Bank and IMF loans has given
these institutions leverage to control economic policy-making in
these countries. The policies mandated by the World Bank and IMF
have forced African governments to orient their economies towards
greater integration in international markets at the expense of
social services and long-term development priorities. They have
reduced the role of the state and cut back government expenditure.

While many African countries succeeded in improving their health
care systems in the first decades after independence, the
intervention of the World Bank and IMF reversed this progress.
Investments in health care by African governments in the 1970s
achieved improvements in key health indicators. In Kenya, for
example, child mortality was reduced by almost 50% in the first two
decades after independence in 1963 [1]. Across sub-Saharan Africa,
the first decades after independence saw significant increases in
life expectancy, from an average of 44 years to more than 50 years
[2].

In the 1980s and 1990s, however, African governments had to cede
control over their economic decision-making in order to qualify for
World Bank and IMF loans. The conditions attached to these loans
undid much of the progress achieved in public health. The policies
dictated by the World Bank and IMF exacerbated poverty, providing
fertile ground for the spread of HIV/AIDS and other infectious
diseases. Cutbacks in health budgets and privatization of health
services eroded previous advances in health care and weakened the
capacity of African governments to cope with the growing health
crisis. Consequently, during the past two decades the life
expectancy of Africans has dropped by 15 years [3].

Africa Action calls for an end to World Bank and IMF policies that
undermine health. This requires canceling the debts that prevent
African governments from making their full contribution to
addressing the health crisis. It also requires ending the
imposition of harmful economic policies as conditions for future
loans or grants.

This position paper provides a brief background overview of World
Bank and IMF policies. It focuses particularly on their impact on
health.

1. The World Bank and IMF in Africa

The World Bank and IMF were created at the Bretton Woods Conference
in New Hampshire, U.S.A., in 1944. They were designed as pillars
of the post-war global economic order. The World Bank's focus is
the provision of long-term loans to support development projects
and programs. The IMF concentrates on providing loans to stabilize
countries with short-term financial crises.

The World Bank and IMF became increasingly powerful in Africa with
the economic crisis of the early 1980s. In the late 1970s, rising
oil prices, rising interest rates, and falling prices for other
primary commodities left many poor African countries unable to
repay mounting foreign debts. In the early 1980s, Africa's debt
crisis worsened. The ratio of its foreign debt to its export
income grew to 500% [4]. African countries needed increasing
amounts of "hard currency" to repay their external debts (i.e.
convertible foreign currencies such as dollars and deutschmarks).
But their share of world trade was decreasing and their export
earnings dropped as global prices for primary commodities fell.
The reliance of many African countries on imports of manufactured
goods, which they themselves did not produce, left them importing
more while they exported less. Their balance of payments problems
worsened and their foreign debt burdens became unsustainable.

African governments needed new loans to pay their outstanding debts
and to meet critical domestic needs. The World Bank and IMF became
key providers of loans to countries that were unable to borrow
elsewhere. They took over from wealthy governments and private
banks as the main source of loans for poor countries. These
institutions provided "hard currency" loans to African countries to
insure repayment of their external debts and to restore economic
stability.

The World Bank and IMF were important instruments of Western powers
during the Cold War in both economic and political terms. They
performed a political function by subordinating development
objectives to geostrategic interests. They also promoted an
economic agenda that sought to preserve Western dominance in the
global economy.

Not surprisingly, the World Bank and IMF are directed by the
governments of the world's richest countries. Combined, the "Group
of 7" (U.S., Britain, Canada, France, Germany, Italy and Japan)
hold more than 40% of the votes on the Boards of Directors of these
institutions. The U.S. alone accounts for almost 20% [5].

It was U.S. policy during the Reagan Administration in the early
1980s, to expand the role of the World Bank and IMF in managing
developing economies [6]. The dependence of African countries on
new loans gave the World Bank and IMF great leverage. The
conditions attached to these loans required African countries to
submit to economic changes that favored "free markets."

This standard policy package imposed by the World Bank and IMF was
termed "structural adjustment." This referred to the purpose of
correcting trade imbalances and government deficits. It involved
cutting back the role of the state and promoting the role of the
private sector. The ideology behind these policies is often labeled
"neo-liberalism," "free market fundamentalism,"or the "Washington
Consensus." From the 1970s on, this orientation became the
dominant economic paradigm for rich country governments and for the
international financial institutions.

The basic assumption behind structural adjustment was that an
increased role for the market would bring benefits to both poor and
rich. In the Darwinian world of international markets, the
strongest would win out. This would encourage others to follow
their example. The development of a market economy with a greater
role for the private sector was therefore seen as the key to
stimulating economic growth.

The crisis experienced by African countries in the early 1980s did
expose the need for economic adjustments. With declining incomes
and rising expenses, African economies were becoming badly
distorted. Corrective reforms became increasingly necessary. The
key issue with adjustments of this kind, however, is whether they
build the capacity to recover and whether they promote long-term
development. The adjustments dictated by the World Bank and IMF
did neither.

African countries require essential investments in health,
education and infrastructure before they can compete
internationally. The World Bank and IMF instead required countries
to reduce state support and protection for social and economic
sectors. They insisted on pushing weak African economies into
markets where they were unable to compete with the might of the
international private sector. These policies further undermined
the economic development of African countries.

2. What is Structural Adjustment?

Structural adjustment refers to a package of economic policy
changes designed to fix imbalances in trade and government budgets.
In trade, the objective is to improve a country's balance of
payments, by increasing exports and reducing imports. For budgets,
the objective is to increase government income and to reduce
expenses. In theory, achieving these goals will enable a country to
recover macroeconomic stability in the short-term. It will also set
the stage for long-term growth and development.

The structural adjustment programs of the early 1980s were meant to
provide temporary financing to borrowing countries to stabilize
their economies. These loans were intended to enable governments
to repay their debts, reduce deficits in spending, and close the
gap between imports and exports. Gradually, these loans evolved
into a core set of economic policy changes required by the World
Bank and IMF. They were designed to further integrate African
countries into the global economy, to strengthen the role of the
international private sector, and to encourage growth through
trade.

Typical components of adjustment programs included cutbacks in
government spending, privatization of government-held enterprises
and services, and reduced protection for domestic industry. Other
types of adjustment involved currency devaluation, increased
interest rates, and the elimination of food subsidies. The
underlying intention was to minimize the role of the state.

World Bank and IMF adjustment programs differ according to the role
of each institution. In general, IMF loan conditions focus on
monetary and fiscal issues. They emphasize programs to address
inflation and balance of payments problems, often requiring
specific levels of cutbacks in total government spending. The
adjustment programs of the World Bank are wider in scope, with a
more long-term development focus. They highlight market
liberalization and public sector reforms, seen as promoting growth
through expanding exports, particularly of cash crops.

Despite these differences, World Bank and IMF adjustment programs
reinforce each other. One way is called "cross-conditionality."
This means that a government generally must first be approved by
the IMF, before qualifying for an adjustment loan from the World
Bank. Their agendas also overlap in the financial sector in
particular. Both work to impose fiscal austerity and to eliminate
subsidies for workers, for example. The market-oriented
perspective of both institutions makes their policy prescriptions
complementary.

Adjustment lending constitutes 100% of IMF loans. In 2001,
approximately 27% of World Bank lending to African countries was
for "adjustment." In the World Bank's total loan portfolio,
adjustment lending generally accounts for between one-third and
one-half [7]. The remainder of World Bank loans are disbursed for
development projects and programs. The project portfolio of the
Bank covers such areas as infrastructure, agricultural and
environmental development, and human resource development. In some
cases, the projects supported by World Bank loans do make useful
contributions to development. But these occasional successes must
be weighed against the negative effects of increasing debt, imposed
economic policies and their consequences.

The past two decades of World Bank and IMF structural adjustment in
Africa have led to greater social and economic deprivation, and an
increased dependence of African countries on external loans. The
failure of structural adjustment has been so dramatic that some
critics of the World Bank and IMF argue that the policies imposed
on African countries were never intended to promote development.
On the contrary, they claim that their intention was to keep these
countries economically weak and dependent.

The most industrialized countries in the world have actually
developed under conditions opposite to those imposed by the World
Bank and IMF on African governments. The U.S. and the countries of
Western Europe accorded a central role to the state in economic
activity, and practiced strong protectionism, with subsidies for
domestic industries. Under World Bank and IMF programs, African
countries have been forced to cut back or abandon the very
provisions which helped rich countries to grow and prosper in the
past.

Even more significantly, the policies of the World Bank and IMF
have impeded Africa's development by undermining Africa's health.
Their free market perspective has failed to consider health an
integral component of an economic growth and human development
strategy. Instead, the policies of these institutions have caused
a deterioration in health and in health care services across the
African continent.

3. Poverty and Health Care Cuts

Health status is influenced by socioeconomic factors as well as by
the state of health care delivery systems. The policies prescribed
by the World Bank and IMF have increased poverty in African
countries and mandated cutbacks in the health sector. Combined,
this has caused a massive deterioration in the continent's health
status.

The health care systems inherited by most African states after the
colonial era were unevenly weighted toward privileged elites and
urban centers. In the 1960s and 1970s, substantial progress was
made in improving the reach of health care services in many African
countries. Most African governments increased spending on the
health sector during this period. They endeavored to extend
primary health care and to emphasize the development of a public
health system to redress the inequalities of the colonial era. The
World Health Organization (WHO) emphasized the importance of
primary healthcare at the historic Alma Ata Conference in 1978.
The Declaration of Alma Ata focused on a community-based approach
to health care and resolved that comprehensive health care was a
basic right and a responsibility of government.

These efforts undertaken by African governments after independence
were quite successful. There were increases in the numbers of
health professionals employed in the public sector, and
improvements in health care infrastructure in many countries.
There was also some success in extending care to formerly unserved
areas and populations. Across the continent, there were
improvements in key health care indicators, such as infant
mortality rates and life expectancy.

In Zambia, the post-independence government expanded public health
care services throughout the country. The number of doctors and
nurses was also significantly increased during this time. Infant
mortality was reduced from 123 per 1,000 live births in 1965, to 85
in 1984 [8]. In Tanzania, during the first two decades of
independence, the government succeeded in expanding access to
health care nationwide. By 1977, more than three-quarters of
Tanzania's population lived within 5 km of a health care facility
[9].

While the progress across the African continent was uneven, it was
significant, not only because of its positive effects on the health
of African populations. It also illustrated a commitment by
African leaders to the principle of building and developing their
health care systems.

With the economic crisis of the 1980s, much of Africa's economic
and social progress over the previous two decades began to come
undone. As African governments became clients of the World Bank
and IMF, they forfeited control over their domestic spending
priorities. The loan conditions of these institutions forced
contraction in government spending on health and other social
services.

Poverty and Health

The relationship between poverty and ill-health is well
established. The economic austerity policies attached to World
Bank and IMF loans led to intensified poverty in many African
countries in the 1980s and 1990s. This increased the vulnerability
of African populations to the spread of diseases and to other
health problems.

The public sector job losses and wage cuts associated with World
Bank and IMF programs increased hardship in many African countries.
During the 1980s, when most African countries came under World Bank
and IMF tutelage, per capita income declined by 25% in most of sub-
Saharan Africa [10]. The removal of food and agricultural
subsidies caused prices to rise and created increased food
insecurity. This led to a marked deterioration in nutritional
status, especially among women and children. In Zambia, for
instance, following the elimination of food subsidies, many poor
families had to reduce the number of meals per day from two to one
[11]. Malnutrition resulted in low birth weights among infants and
stunted growth among children in many countries. It is currently
estimated that one in every three children in Africa is underweight
[12]. In general, between one-quarter and one-third of the
population of sub-Saharan Africa is chronically malnourished.

The deepening poverty across the continent has created fertile
ground for the spread of infectious diseases. Declining living
conditions and reduced access to basic services have led to
decreased health status. In Africa today, almost half of the
population lacks access to safe water and adequate sanitation
services [13]. As immune systems have become weakened, the
susceptibility of Africa's people to infectious diseases has
greatly increased. A joint release issued by the WHO and the Joint
UN Programme on HIV/AIDS (UNAIDS) in April 2001 reports that the
number of cases of tuberculosis in Africa will reach 3.3 million
per year by 2005 [14]. The WHO reported in 2001 that almost 3,000
Africans die each day of malaria. Each year in Africa, the disease
takes the lives of more than 500,000 children below the age of five
[15].

Most devastating of all has been the impact of the HIV/AIDS
pandemic. The spread of HIV/AIDS in Africa has been facilitated by
worsening poverty and by the conditions of inequality intensified
by World Bank and IMF policies. Economic insecurity has reinforced
migrant labor patterns, which in turn have increased the risk of
infection. Reduced access to health care services has increased
the spread of sexually transmitted diseases and the vulnerability
to HIV infection.

(Continued in part 2)

Endnotes for part 1

1. Paul Kieti Kimalu, Debt Relief and Health Care in Kenya
(Nairobi: Kenya Institute for Public Policy Research and Analysis,
July 2001).
http://www.wider.unu.edu/conference/conference-2001-2/poster%20pa
pers/kimalu.pdf

2. The World Bank, World Development Indicators (Washington,
2001). See table 8 at:
http://www.worldbank.org/poverty/data/trends/mort.htm

3. Reported from the fourth general assembly of the African
Population Commission, Addis Ababa, Ethiopia, February 2002. See
http://www.globalpolicy.org/socecon/develop/aids/africa/LifeXpec0
212.htm

4. Kevin Watkins et al, The Oxfam Poverty Report (Oxford, 1995),
p. 74.

5. The U.S. holds 16.45% of the votes at the World Bank, and
over 17% of the votes at the International Monetary Fund.

6. Rick Rowden, "Globalization and Protest Against the Policies
and Outcomes of a Corporate-Led Process", a paper presented at
the "Poverty and Globalization Conference," St. John's
University, Jamaica, NY, April 2001. (Available upon request
from the author at [email protected])

7. The World Bank, Annual Report 2001 (Washington, 2001), volume
1, p. 154.
http://www.worldbank.org/annualreport/2001/Bank_splash12.html

8. Meredeth Turshen, Privatizing Health Services in Africa (New
Brunswick, NJ, Rutgers University Press, 1999), p. 38.

9. John Yudkin, "Tanzania: still optimistic after all these
years?", in The Lancet (1999; 353: 1519-21).

10. UNICEF, "Balance sheet of human progress in Africa," posted
beginning in September 2000 at
http://www.unicef.org/miscellaneous/balance.htm

11. Turshen, Privatizing Health Services in Africa, p. 17.

12. UNICEF, The State of the World's Children (New York, 1998),
section on "The Silent Emergency".
http://www.unicef.org/sowc98/silent.htm

13. UNICEF, "Balance sheet of human progress in Africa."

14. Joint UNAIDS/WHO Press Release, "HIV Causing Tuberculosis
Cases to Double in Africa", April 23, 2001. See
http://www.unaids.org/whatsnew/press/eng/pressarc01/
TB_240401.html

15. "Roll Back Malaria" a partnership of the World Health
Organization (WHO), UNICEF, UNDP and the World Bank. See
http://www.rbm.who.int

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Hazardous to Health: The World Bank and IMF in Africa

Africa Action Position Paper

By: Ann-Louise Colgan, Research Associate, Africa Action

April, 2002

(continued from part 1)

More than 17 million Africans have died of HIV/AIDS. It is
currently estimated that more than 28 million of the 40 million
people living with the disease worldwide are in sub-Saharan Africa
[16]. There are more than 12 million African orphans who have lost
their mothers or both parents to AIDS [17]. The social and
economic effects of the AIDS crisis are reversing post-independence
progress and exacerbating conditions of underdevelopment. The
policies imposed by the World Bank and IMF have fueled the spread
of the disease and continue to hinder the response to this health
emergency.

Declining Health Care Systems

As poverty has increased Africa's health problems, World Bank and
IMF intervention has also led to a breakdown of health care
delivery systems. The role of the state in the provision of health
care services has been reduced substantially. Cutbacks in the
health sector have severely undermined existing services. And
Africa's debt repayment obligations to foreign creditors have
diverted money directly from spending on health.

Cutbacks in government spending represent a major component of
World Bank and IMF adjustment programs. In the 1980s, real
disbursements per person dropped in government expenditure in many
African countries. In Madagascar, between 1977 and 1985,
government expenditures declined by 24% [18]. Cutbacks in
government budgets led to major cuts in the health sector. In the
42 poorest countries in Africa, spending on health care fell by 50%
during the 1980s [19]. In Nigeria, per capita expenditure on
health fell by 75% between 1980 and 1987 [20].

The dramatic drop in health expenditure in the 1980s and 1990s
resulted in the closure of hundreds of clinics, hospitals and
medical facilities across the continent. Those that remained open
were generally left under-staffed and lacking in essential medical
supplies. Many were unable to afford even basic vaccines. In 14
sub-Saharan African countries between 1990-1992, the level of polio
vaccination dropped by more than 10% as a result of cutbacks in
health care services [21].

Thousands of health care professionals throughout the continent
lost their jobs as a result of public sector cuts. In Ghana,
between 1982 and 1992, the number of doctors in the government
health care system dropped from 1700 to 665. In Senegal, between
1980 and 1993, the number of people per nurse increased six-fold
[22].

Even as government spending on health was cut back, the amounts
being paid by African governments to foreign creditors continued to
increase. By the 1990s, most African countries were spending more
repaying foreign debts than on health or education for their
people. Health care services in African countries disintegrated,
while desperately needed resources were siphoned off by foreign
creditors. It was estimated in 1997 that sub-Saharan African
governments were transferring to Northern creditors four times what
they were spending on the health of their people [23]. IN 1998,
Senegal spent five times as much repaying foreign debts as on
health [24]. Across Africa, debt repayments compete directly with
spending on Africa's health care services.

The erosion of Africa's health care infrastructure has left many
countries unable to cope with the impact of HIV/AIDS and other
diseases. Efforts to address the health crisis have been
undermined by the lack of available resources and the breakdown in
health care delivery systems. The privatization of basic health
care has further impeded the response to the health crisis.

4. Privatization and User Fees

Privatization forms a centerpiece of the World Bank and IMF agenda.
Reducing the size and scope of government, and privatizing
state-owned enterprises and services, is a major element of World
Bank and IMF programs. Under World Bank and IMF direction, control
of health care services has increasingly been transferred from
African governments to the private sector. The rationale is that
health care services are better financed and more efficiently
delivered privately.

The World Bank has recommended several forms of privatization in
the health sector. These include: the introduction of "user fees"
for health services previously provided free of charge; the
promotion of health insurance schemes; increased investments in
private care in order to attract patients to private facilities.
Through these measures, private services are made the primary focus
of health care.

Throughout Africa, the privatization of health care has reduced
access to necessary services. The introduction of market
principles into health care delivery has transformed health care
from a public service to a private commodity. The outcome has
been the denial of access to the poor, who cannot afford to pay for
private care.

For example, the introduction of user fees for health care services
has been shown to sharply reduce access for those unable to pay.
The World Bank and IMF have promoted "user fees" as a means of
generating revenue for the health sector. They argue that these
fees will tax the rich and that a system of exemptions will protect
the poor from the costs. However, the evidence shows that user
fees have actually succeeded in driving the poor away from health
care services.

Ghana, Swaziland and the former Zaire were among the first African
countries where user fees replaced free, or almost free, services.
In each of these, studies showed that the introduction of fees led
to reduced utilization of these services [25]. Studies in C"te
d'Ivoire have shown that those with income above the median make
more use of medical services when a user fee is charged. But those
with below median incomes reduce their use [26]. Across Africa,
reports indicate that attendance at hospitals and clinics drops
significantly after the introduction of user fees.

Schemes intended to exempt the poor from user fees have been shown
to be ineffective. A comprehensive UNICEF study discovered that
such schemes are rare [27]. The study claims that poor people are
generally unaware of such exemptions, and that there are often
complex administrative barriers involved. The report concludes
that the implementation of exemption schemes is infrequent and is
applied in ad hoc ways. It therefore does not appear that user
fees have been managed so as to collect revenues only from the
rich. Instead, they have had the effect of closing off access to
those who cannot pay. As a recent paper concluded, user fees
"increase the barriers disproportionately faced by the poor when
seeking health care."[28] Their failure to generate revenue has
also undermined their economic rationale, as propounded by the
World Bank and IMF.

Another form of privatization involves the promotion of insurance
schemes as a means to defray the costs of private health care.
This is inherently flawed in the African context. Less than 10% of
Africa's labor force is employed in the formal job sector [29].
Therefore, the vast majority of people are not eligible for
insurance through their employer. Income levels in Africa are
extremely low, and have been reduced further by wage cuts and lay-
offs associated with World Bank and IMF austerity policies. Most
Africans cannot afford the cost of private insurance. In view of
such circumstances, insurance schemes cannot resolve the issue of
access to private health care in African countries [30].
Beyond the issue of affordability, private health care is also
inappropriate in responding to Africa's particular health needs.
When infectious diseases constitute the greatest challenge to
health in Africa, public health services are essential. Private
health care cannot make the necessary interventions at the
community level. Private care is less effective at prevention, and
is less able to cope with epidemic situations. Successfully
responding to the spread of HIV/AIDS and other diseases in Africa
requires strong public health care services.

The privatization of health care in Africa has created a two-tier
system which reinforces economic and social inequalities. As
health care has become an expensive privilege, the poor have been
unable to pay for essential services. The result has been reduced
access and increased rates of illness and mortality. Despite these
devastating consequences, the World Bank and IMF have continued to
push for the privatization of public health services.

5. Recent Developments: Reform or Repackaging?

In recent years, there has been growing criticism of the impact of
World Bank and IMF programs in developing countries. As a result,
these institutions have shifted their public stance in favor of
"poverty reduction." They have attempted to re-package structural
adjustment to include greater emphasis on social development
programs.

The "Poverty Reduction" Spin

Both the World Bank and IMF have proclaimed a greater commitment to
"poverty reduction" in recent years. They have made it a
requirement for countries to prepare Poverty Reduction Strategy
Papers (PRSPs) as a condition for the receipt of new loans or debt
relief. These papers are intended to be drawn up by national
governments in consultation with civil society "stakeholders" and
with World Bank and IMF guidance. They are to outline the
priorities and strategies of African governments in their
development efforts. In order to reflect their concern with social
development, the World Bank and IMF have also renamed structural
adjustment lending. The IMF now uses the term "Poverty Reduction
and Growth Facility" (PRGF). The World Bank's new term is "Poverty
Reduction and Support Credits"(PRSCs).

The World Bank has also increased its funding for health, and for
HIV/AIDS programs in particular. While the shift in focus towards
prioritizing social development and poverty eradication is welcome,
fundamental problems remain. New lending for health and education
can achieve little when the debt burden of most African countries
is already unsustainable. Debt cancellation should be the first
step in enabling African countries to tackle their social
development challenges. Additional resources to support health and
education programs should be conceived as public investment, not
new loans.

The new spin on the World Bank and IMF priorities fails to change
the basic agenda and operations of these institutions. Indeed, it
appears to be largely an exercise in public relations. The
conditions attached to World Bank and IMF loans still reflect the
same orientation prescribed over the past two decades. The recent
moves towards promoting poverty reduction have actually permitted
these institutions to increase the scope of their loan conditions
to include social sector reforms and governance aspects. This
allows an even greater intrusion into the domestic policies of
African countries. It is highly inappropriate that external
creditors should have such control over the priorities of African
governments. And it is disingenuous for such creditors to
proclaim concern with poverty reduction when they continue to drain
desperately needed resources from the poorest countries.

Equivocation on User Fees

In 1998, the Bank's Operations Evaluation Department reported that
nearly 75% of projects in sub-Saharan Africa included the
establishment or expansion of user fees [31]. As the negative
effects of user fees have begun receive more public attention, the
Bank has sought to distance itself from the promotion of these
fees.

In a policy statement at the end of 2000, the World Bank announced
that it was stepping back from the promotion of user fees for basic
social services in the developing world. It stated that it
supports the provision of basic health care for free. However, it
added that well-designed and well-implemented fees can be useful in
mobilizing additional resources for these services in poor
countries. It maintains that exemption schemes do work in some
countries. Overall, it remains convinced that user fees can
improve the quality of health care services being provided.

It is difficult to ascertain whether the World Bank is still
pushing user fees in practice. Indeed, it is not easy to monitor
the content of the Bank's adjustment programs at all because of the
lack of information disclosure on this form of lending. In the
U.S., an important victory was achieved in 2000, when Congress
passed language against user fees. This language requires the U.S.
representatives to the World Bank and IMF to oppose user fees.
These representatives must inform Congress within 10 days if any
loan requiring the imposition of user fees is approved by the
International Financial Institutions.

Despite this victory, challenges remain. It has been documented in
at least one case since then that user fees have been included in
a loan package, despite this legislative language. This calls into
question the commitment of the World Bank and, of its U.S.
Directors, to ending user fees as part of World Bank and IMF
prescriptions. At the IMF, no move has been made to indicate a new
policy on the imposition of user fees in borrower countries.

Water Privatization, a threat to future health

The privatization of public water systems is a strategy being
promoted by the World Bank in an increasing number of African
countries. This involves the reduction of public subsidies for
clean water. It also involves, in some cases, the introduction of
cost-recovery measures for access to water supplies.

This development represents a major cause for concern. Access to
clean water is a vital public health necessity and a basic human
right. The privatization of water can only lead to reduced access
to safe water for poor communities. In Ghana, the recent moves
towards water privatization are being opposed by civil society
groups for this reason. Already, according to the Ghanaian
Ministry of Health, half of all clinic visits in Ghana are due to
water-borne illnesses. The groups opposing privatization are
concerned that this move will further reduce access to safe and
affordable water in urban areas [32].

Over two million people in developing countries die each year
because of diseases related to lack of clean water. Many of these
are children. Increased privatization of water in African
countries can only increase the risk of ill-health among the poor.

6. Conclusion

The free market fundamentalism of the World Bank and IMF has had a
disastrous impact on Africa's health. The all-out pursuit of
market-led growth has undermined health and health care in African
countries. It has forced governments to sacrifice social needs to
meet macroeconomic goals.

This approach to development is fundamentally flawed. The failure
to prioritize public health denies its significance in promoting
long-term economic growth. As the WHO Commission on Macroeconomics
and Health recently concluded, health is more than an outcome of
development, it is a crucial means to achieving development [33].
Investments in Africa's health must therefore form a central part
of any comprehensive development strategy.

Economic and social progress in Africa cannot succeed in the
context of the current health crisis.
In order to address this crisis, it is necessary to tackle the
structural factors that fuel it. The World Bank and IMF must
accept responsibility for the devastating impact that their
policies have had on Africa's health. If the U.S. is serious about
responding to Africa's health crisis, it must use its power at the
World Bank and IMF to end the harmful policies of these
institutions.

Endnotes for part 2

16. UNAIDS/World Health Organization (WHO), "AIDS Epidemic
Update", December 2001 See
http://www.unaids.org/epidemic_update/report_dec01/index.html

17. Salih Booker and William Minter, "AIDS in Africa: is the
world concerned enough?", in Great Decisions, 2002 (New York,
Foreign Policy Association, 2002). See
http://www.africaaction.org/action/aids2002.htm

18. Turshen, Privatizing Health Services in Africa, p. 16.

19. Inter-Church Coalition on Africa (ICCAF), Beyond Adjustment:
Responding to the Health Crisis in Africa (Toronto, 1993), p. 17.

20. ICCAF, "Beyond Adjustment," p. 19.

21. Kamkes, J., van der Meer, J., Mooren, H., and de Wildt, G.,
"Economic adjustment in poor countries is too painful for health
care", Bulletin Medicus Mundi (No. 64, April 1997)
(http://www.medicusmundi.ch/bulletin/bulletin641.htm)

22. B. G. Schoepf, C. Schoepf, and J. Millen, "Theoretical
Therapies, Remote Remedies: SAPs and the Political Ecology of
Poverty and Health in Africa," in J. Yong Kim, J. Millen, A.
Irwin, A., and J. Gershman, J., eds., Dying for Growth. Global
Inequality and the Health of the Poor (Monroe, ME: Common Courage
Press, 2000), p. 112.

23. United Nations Development Programme (UNDP), Human
Development Report 1997 (New York: Oxford University Press,
1997).

24. Jubilee 2000 Coalition, UK, Through the Eye of A Needle.
The Africa Debt Report (London, 2000), p. 4. See
http://www.jubilee2000uk.org/analysis/reports/needle.htm

25. D. Arhin-Tenkorang, "Mobilizing Resources for Health: The
Case for User Fees Revisited", WHO Commission on Macroeconomics
and Health (CMH) Working Paper Series, Paper No. WG3:6., November
2000. Available through http://www.who.int/cmhreport

26. WHO, "Financing Essential Drugs: Report of a WHO Workshop",
document WHO/DAP/88.10, 13. Referenced in Turshen, Privatizing
Health Services in Africa., p. 48.

27. S. Reddy. and J. Vandemoortele, "User Financing of Basic
Social Services. A review of theoretical arguments and empirical
evidence," 1996.
See http://www.unicef.org/reseval/pdfs/Userfees.pdf

28. Arhin-Tenkorang, "Mobilizing Resources for Health."

29. The World Bank, World Development Report 1995 (New York:
Oxford University Press, 1995). Referenced in Turshen,
Privatizing Health Services in Africa., p. 61.

30. Turshen, Privatizing Health Services in Africa.

31. John Gershman, "The World Bank and Health".
See http://www.bicusa.org/ptoc/htm/gershman_health.htm

32. For more information, see
http://www.isodec.org.gh/isodec/campaigns.htm

33. For the final report of the WHO Commission on Macroeconomics
and Health, see the section on the WHO website at
http://www.who.int/cmhreport

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