The Politics and Economics of Policy Reform in Zambia

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Periodical article

Title:	The Politics and Economics of Policy Reform in Zambia
Authors:	Bates, Robert H. Collier, Paul
Year:	1995
Periodical:	Journal of African Economies
Volume:	4
Issue:	1
Period:	May
Pages:	115-143
Language:	English
Geographic term:	Zambia
Subjects:	politics economic policy Politics and Government Economics and Trade
External link:	https://jae.oxfordjournals.org/content/4/1/115.full.pdf
Abstract:	This essay analyses the process of economic policy reform in Zambia, focusing on the period 1985-1990. In October 1985 the Zambian government shifted to a policy of liberalization, abandoning price controls and promoting an expanded role for markets. A central feature of these reforms was the introduction of an auction for foreign exchange. In May 1987, the government re-imposed controls on markets for commodities, credit, and foreign exchange. In doing so, it broke with the IMF, an act that led to the suspension of credit from the World Bank and from most donor countries. Still later, in 1989, the government switched back to market orientated economic policies. The essay analyses the key features of the Zambian political system, showing that while in purely economic terms the policy reforms were initially sustainable, the apparent consequences of liberalization were politically unacceptable to the particular interest groups then in charge of the State. Ostensibly minor government backsliding caused a speculative response which became self-fulfilling. Bibliogr., notes, ref., sum.