Problems Facing The World Bank In Zimbabwe Case Study

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The World Bank and International Monetary Fund (IMF) are two of the most powerful international financial institutions in the world. They are the major sources of lending to African countries, and use the loans they provide as leverage to prescribe policies and dictate major changes in the economies of these countries.
The Problems That the World Bank and IMF Created for Zimbabwe
Zimbabwe had agreements with the World Bank in the later 1980s when it signed an arrangement with the IMF in exchange for a $484 million loan. In order to get the loan, Zimbabwe had to accepted the conditions required by the IMF of the policy changes, which including Zimbabwe to “cut its fiscal deficit, tax rate reductions, the deregulation of financial markets, to …show more content…

In addition, reduced protection of the manufacturing sector and the reduction in public spending and labor market deregulation caused real wages dropping and a higher unemployment rate.
In order to meet the IMF’s fiscal targets for adjustment, Zimbabwe had to cut down the expenditures on health care, which led to the quality of public health care dropped. As a result of the wage cuts, many doctors quit their work for public service and moved to the private health sector, which as a result, the public health services became less accessible to the poor. After the deterioration of the public health care, the rate of the child death and many diseases including AIDS has …show more content…

Unfortunately, the World Bank and IMF are controlled by the world’s richest countries, which ensures that the World Bank and IMF act in the interest of the rich countries, promoting a model of economic growth that benefits the richest countries and the international private sector. They ignored the sufferings caused by them to the peoples, especially in many developing countries through their economic policies. The World Bank and IMF have forced African countries to adopt “structural adjustment programs” (SAP) and other measures which cut back government spending on basic services. They have required African governments to reduce trade barriers and open their markets, maintaining their economies as sources of cheap raw materials and cheap labor for multinational

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