From SAPs to PRSPs : Ideological Dogmatism in Development Policy and Good Governance in the Era of Neoliberalism

After a decade of implementation, SAPs policies had horrific economic and social consequences. The policy framework was successful only at its neoliberal goals to diminish government size and integrate developing countries into the liberal global economy. The notion of good governance was born in reaction to this failed agenda. In the view of the IFIs, the failure of SAPs to generate economic growth was not because of a flawed policy but due to bad governance that severely impeded successful implementation in low-income countries. Since the late 1980s, therefore, the notion of “good governance” as a new and sole recipe for development was devised and continues to drive international development policy and practice. Following the 1997 Asian financial crises and the uproar against the IMF's structural adjustment prescriptions, the IFIs shifted gears, turning the rhetoric of development policy to what SAPs were not and failed to achieve. Poverty reduction was placed as top agenda of a new development policy framework, Poverty Reduction Strategy Papers (PRSPs), launched in 1999. After more than a decade, however, poverty in absolute terms continues to rise in developing countries and global income and wealth inequality widened, further worsened by the global financial crisis. Moreover, it became clear that the change of development approach has been mainly in rhetoric. In practice, there is little evidence showing a genuine shift away from neoliberal principles. In what ways are PRPSs different from SAPs? Is there a real change in development principles, policies and practices? What is the future of neoliberal development policies given the crisis of neoliberalism? What is the future of good governance in its current free market-based fashion? This paper seeks to answer these questions by examining the policy paradigms — SAPs and PRSPs — promoted under the rubric of good governance in poor countries. It critically examines the “free market” neoliberal dogma that underlies development policy, the ideological change and continuity, and the future of good governance as a recipe for development. It argues that the new consensus on good governance rest on “re-branding and re-spinning new progressive outfits for old liberal policy”, constituting “the best ideological shell of neoliberalism today.”