Expansion of Capitalism a threat to third world economies.

The economics of IMF and World Bank are based on neo liberal policies which seek to promote free markets and are aimed at limiting government intervention exchange rate stability. Since the collapse of the Bretton Wood Systems in the 1970s we have witnessed an unprecedented number of countries joining the Fund and pulling out of the Washington base institutions because of the perceived harm it causes to developing countries. We must also point out that  IMF was indeed an American foreign policy instrument to deter Soviet expansion across continents by dishing out cash in developing economies such as those in Latin America , Africa and Asia easily. However the situation changed in the late 1980s when it became clear that the Soviet Union was no longer a threat to global order and the US national security.


Authors of Capitalism

The Fund started to change the way it lends money to developing countries as a result  borrowing countries in the early 1990s were now required to adopt free market orthodoxy policies in return for for financial help which is now called technical assistance by IMF economists. Its fair to say , a new global economic-social and political orders are being  promoted on the expense of the poor by these western backed institutions.

Over the past five decades many countries were modelled on either communist or socialist principles including Great Britain and continental Europe .However this had to change when the US started to spread capitalism ideology throughout the world using IMF and the World Bank as instruments for change promoting global economic integration (globalization).These policies such as privatization, contraction fiscal and monetary policy paused a major threat to domestic investments in most participating economies(countries) .I still remember Mrs. Thatcher (British Prime Minister at the time ) started privatize all major British industries including rail and energy forcing inflation to rocket in 1992 and was exacerbated by cuts in government spending all this prompted civil unrest in most deprived areas of London and  the North (Stoke-On-Trent, Manchester and Liverpool) . Mrs Thatcher  saw a seed of her downfall when she adpted this policy and few years later she was seen crying at her annual conservative people’s party conference just after massive  demonstration across the UK. This was a different case in the the US because everyone was prepared for capitalist reforms.
Again in the early 1990s similar events happened to us when President  Mugabe imposed what the rest of the working class at the time regarded as slaughter of human welfare. That was because the president responded positively to IMF`s conditionality program (neo-Liberal manifesto) and the result was harsh among urban communities as people lost the jobs as well as high prices of basic commodities .In those days Tsvangirai was quoted by one western news agency as saying we are now forced to adopt a new life style which is too brutal for all Zimbabweans. After years of civil discontent and strikes among the working class, a new political party (MDC) emerged finally led by Morgan Tsvangirai a party that continued to challenge the governing party (ZANU-PF) up to now. In Britain, Thatcher lost her job and since then British electorate never reconciled with Tory party due to Thatcher`sharsh economic policies of last conservative government.

 
President Mugabe defying workers demands
Elsewhere in Latin America the outcome of the IMF sponsored program brought misery in (1980-1990) as inflation hit a hyper level like the one we witnessed in here in Zimbabwe (2008). There were many incidence of poverty and malnutrition in all participating countries in the region  which resulted in civil wars and coups. The danger of these programs is that governments are being banned from spending on major public services such health care, education and transport as well as other government subsidies. Therefore, such fiscal contraction have a negative impact on the poor and likely to cause civil unrest.

Having said that , I am not totally against (IMF and The World Bank) but there is something wrong with the way they conduct their business.They pose a serious threat to social and political setup of our countries by bringing in  new orders which does not fit well in any part of lives. IMF and the World Bank are the main  instruments for regime change and policy towards the poor. As such Africa will remain under developed if we continue extending all our hands to these institutions,We got to rely on ourselves,  Africa  a rich continent of which if all reasonable policies are implemented (indigenously) everyone will be assured of a better future.

Since the 1980s, the global economy is coming together (globalization) but these pose a serious threat to us in Zimbabwe and elsewhere in developing economies. Surely we do agree that in some way the countries should be member of these International Financial institutions but those powerfully countries of the world should not tell us how we should spend our resources and what policy to take.