ABSTRACT

This chapter assesses the reforms carried-out under Structural Adjustment Loans (SALs) I, II and III in the non-agricultural sectors of the economy, namely, the corporate and parastatal sectors, the industrial sector, the foreign trade regime, and public sector finance. Public sector financial reform received high priority throughout the life of the three SALs, with the public sector targeted to bear most of the disabsorption required to reduce external payments pressures. The SAL programme focused on reducing the budget deficit, whilst at the same time improving the selection of public investments and maintaining adequate recurrent outlays. SAL measures to reduce the overall budget deficit focused on both reducing expenditures and increasing revenues. A final conclusion on public sector financial reform is that although the budget deficit remained problematic the SALs had introduced several important institutional reforms which helped to improve public sector financial management and without which the budget deficit may have been even larger.