||Pressure to Rethink
the Free-Market Adjustment Model
to create compensatory mechanisms within adjustment programmes were among the first signs
of a significant new shift in the overall approach of international financial institutions
and Northern governments to stabilization and adjustment. Pressure came not only from
angry citizens of Third World countries, who took to the streets in what came to be known
as "IMF riots", but also from concerned citizens' groups and non-governmental
organizations engaged in grassroots development assistance in Third World countries.
Evidence of worsening social conditions, brought to the attention of the international
community by bilateral and multilateral agencies (among which UNICEF assumed a leading
role), also played an important part in encouraging a policy shift. Threats to demand
serious organizational and administrative "adjustment" efforts within the World
Bank and the International Monetary Fund themselves, and to tie these efforts to a
possible reduction in their resources, underlined the advisability of rethinking the
lending practices of these institutions.
The emergence in the early 1990s of groups within
international civil society which could claim to have a legitimate voice in shaping the
approach of multilateral institutions to stabilization and adjustment was unprecedented.
It represented a challenge not only to the prevailing ideology of development, but also to
the legitimacy of a style of international economic policy-making which had become highly
technocratic and secretive.