The Impact of the World Bank and the International Monetary Fund (IMF)
The two most influential financial organizations in the world are the World Bank and the International Monetary Fund (IMF) (Agang, 2011). The institutions are the main providers of credit to developing nations, but they also utilize the money they lend to pressure governments into adopting policies that force changes in the economies of the majority of those nations. The most developed nations, especially the United States, control the IMF and the World Bank. This means that the institutions serve the needs of the wealthiest nations and the global business sector while allowing underdeveloped nations to suffer in abject poverty.
The Role of Structural Adjustment Programs (SAP)
The past decades have seen poor countries turn to the World Bank and IMF for financial assistance because their level of impoverishment means they do not qualify for loans in other institutions. As a result, the institutions have adopted a structural adjustment programs (SAP) and other measures that reduce spending on basic services (Agang, 2011). Nigeria, one of the beneficiaries has been forced to open their markets and reduce trade barriers, hence maintaining their economies as sources of cheap labor and raw materials for multinationals. The consequence is a reduction of average income and an increase in poverty. These institutions have also greatly undermined health in Nigeria through their policies. Privatization of basic services as well as forced cutbacks on spending on healthcare means more people are vulnerable to HIV/AIDS and other diseases related to poverty.
Negative Impacts of World Bank Projects in Nigeria
Projects sponsored by the World bank in Nigeria have seen millions of people pushed out of their lands and their livelihoods threatened. The people living in Badia East, a slum in Lagos were pushed out without compensation or warning to pave way for a World Bank project (Agang, 2011). Another example of the negative impacts of the two largest lending institutions in the world is the international Power Politics. The advanced economies such as the U.S dominate decision making in the IMF. Developing economies consequently suffer as they are made to adopt decisions made by developed economies. In 2012, the Nigerian government abruptly lifted subsidies on imported gasoline and other fuels. The decision threw the nation into chaos and on the verge of a civil war. The move was attributed to pressure by the IMF on the Nigerian government with the promise of ending corruption. Instead, the IMF should have focused on expanding the Nigerian oil refinery to eliminate the need to import gasoline.
The Importance of a Healthy Population
A healthy population is desirable in most countries in order to improve its economy. One way in which the economy can be improved is through the eradication of diseases. During the outbreak of the Ebola virus that spread to Nigeria, the most populous nation in Africa saw a decline in its industries (In Evans & World Bank Group, 2014). The aviation industry was hard hit as flights into and out of Nigeria were cancelled. The hospitality and tourism industry which is expected to be the next major revenue generator was hard hit as tourists kept away from the country. Hence, eradication of diseases can promote various industries and propel economic growth (Araujo, Evans & Maeda, 2016). A healthy population means that the life expectancy is high. Human capital and be trained to work in industries and improve productivity. Nigeria is affected by high death rates that see it lose professionals in many industries. Furthermore, the mortality among the young population is also high, leaving few people to be trained to handle jobs in the economy (In Evans & World Bank Group, 2014). A healthy population means that resources that would have been pumped into healthcare are pumped into more important sectors of the economy. Developed countries do not allocate the majority of their budget to healthcare (Araujo, Evans & Maeda, 2016). Instead, those resources are directed towards other developments such as construction of roads, service delivery and tourism that promote revenue generation. A healthy population means that human capital is able to work and increase incomes. The standards of living in the country improve as wages are used to improve life rather than cater for medical bills.
The Challenges of the Nigerian Healthcare System
The healthcare system is Nigeria is not performing at its optimal level. Despite receiving foreign aid, poor governance, weak co-ordination and collaboration have left the sector crippled and inefficient (Kentikelenis, Stubbs & King, 2015). The healthcare system is fragmented with the federal government and the state government having their share of responsibilities. Unfortunately, the country still experiences over 800,000 deaths among children under five years. Up to 40% of the diseases that cause death are immunizable diseases that can be prevented by immunizing infants and children (“UNICEF – Immunization – Why are children dying?”, 2017). In addition, Nigeria’s population ranks it highest in malaria, HIV/AIDS and tuberculosis globally. Other non-communicable diseases such as cancers, diabetes and high blood pressure are on the rise (“UNICEF – Immunization – Why are children dying?”, 2017). Foreign aid is failing in the country due to prioritization of need over output. Donors often pump funds into the healthcare sector but pay very little attention to the achievements of that money. For example, there are no data for co-morbidities, progression of AIDS-related illnesses, adherence rates and mortality rates among others (Kentikelenis, Stubbs & King, 2015). Hence, the Nigerian government needs to put more focus on the results of money spend rather than needs. Once the framework is put in place, the effects of foreign aid in the Nigerian healthcare will be realized.
References
Agang, S. B. (2011). The impact of ethnic, political, and religious violence on Northern Nigeria, and a theological reflection on its healing. Carlisle: Langham Monographs.
Araujo, E. C., Evans, T. G., & Maeda, A. (2016). Using economic analysis in health workforce policy-making. Oxford Review of Economic Policy, 32(1), 41-63.
In Evans, D., & World Bank Group,. (2014). The economic impact of the 2014 Ebola epidemic: short- and medium-term estimates for West Africa.
Kentikelenis, A. E., Stubbs, T. H., & King, L. P. (2015). Structural adjustment and public spending on health: Evidence from IMF programs in low-income countries. Social Science & Medicine, 126, 169-176.
UNICEF – Immunization – Why are children dying?. (2017). Unicef.org. Retrieved 6 March 2017, from https://www.unicef.org/immunization/index_why.html
