• These institutions are dominated by the rich industrialised countries like America, Britain, France, Germany and Japan;

• Structural Adjustment Programmes (SAPs) are the policies imposed by the World Bank and IMF on developing countries when they seek financial aid;

• SAPs aim to restructure a country’s economy to enable it to repay its debt;

• The governments of Australia, New Zealand, Britain, the US and other industrialised countries are voluntarily implementing structural adjustment programmes;

• SAPs call for:

Trade liberalisation, which means removing measures which protect local industries

Investment liberalisation, so that transnational companies are encouraged to invest in a country

Spending cuts, which means that governments cut spending on health, education, housing, pensions and other public services

Cuts in government subsidies, for example, on basic foods

The production of goods for export, rather than meeting the needs of the people of the country

Devaluation of the currency so that exports are cheaper and more competitive on the international market

• The NICs in Asia like South Korea, Thailand and Indonesia have been forced to seek IMF/World Bank financial aid as a result of the current economic crisis;

• These loans have come with conditions, and governments in these countries are now having to implement economic policies which are very similar to the SAPs imposed on most countries in Asia, Latin America and South Asia by the IMF and World Bank.