Impact of Structural Adjustment of the World Bank Essay

Impact of Structural Adjustment of the World Bank - Essay Example Structural adjustments are measures formulated to facilitate and accelerate economic development in the targeted economies3. According Ahmed and Lipton structural adjustment police are intended to rectify the structural imbalance in the foreign and public balances2. The policies could be initiated internally by the country concerned or external forces such the World Bank and the international monetary fund. The structural adjustments reforms endeavor to reduce and eliminate the various financial distortions, such as overvalued exchange rate, huge monetary deficits and to restrict inefficient public services that hinder fair distribution of the resources in the economy of particular country1. In general, the structural adjustments are intended to minimize or eliminate the balance of payments and the public sector deficits, with an objective of stimulating high economic growth. In addition, the policies aimed at achieving an appropriate structural change capable of sustaining a robust economic growth and a favorable monetary environment in a particular economy3. One of the major characteristics of the structural adjustments is promoting specialization where the targeted economy is influenced to produce commodities â€Å"tradable† in the global market and reducing factors that enhance production of commodities with no or little economic value, especially in the public domain4. Enhancing the flexibility and adaptability of the targeted economy to the changing global economic environment is an important objective of the structural adjustments. This reduces the effects of adverse global economic changes on the economy of a particular country 3. Structural adjustment policies comprise of measures aimed at facilitating short-term economic stability and long-term adjustments.