New conditionality and the case of Honduras

New conditionality and the case of Honduras
Zuzana Dostalova
Poverty reduction and social exclusion
Gothenburg University


Development aid has gone through a deep changes during the last decades. What have started as “Structural Adjustment programmes” (SAP) were later on during the 1990s translated into more inclusive and human “Poverty Reduction Strategy Papers” (PRSP). Major difference between thesee programmes launched by the Bretton Woods institutions (BWI) lies in the conditionalities. In SAP, the conditions were mainly tight with neo-liberal economical politics and with the notion of economi growth. There has been a delusion, that  deregulation will lead to economic growth which will then lead to poverty reduction. As we have seen in the past, that was not the case for many countries, especially in Africa. 

The so called “post-developmentalist” era of PRSP introduce a whole new type of conditions. The focus is not anymore on growth but more likely on a partnership and cooperation. Poor countries can ask for debt relief if they have a plan how to combat poverty in form of PRSP. Donor and recipient are becoming partners and they should build the PRSP together, with focus on specific circumstances of the given country. World bank (WB) or International Monetary Fund (IMF) repleced their external control for the concept of consultation, but as the author claims, the neo-liberal agenda imposed by BWIs did not disappear, just got a new name. 

I agree with this point as it is obvious, that the interests of BWIs will be linked with the interest of the most influencial players like the USA or UK. For the western neo-liberal world there will always be self economic interests along with the other reasons why became a donor and help poor countries. Mainly in the case of the USA I think that the effort to expand its economic hegemony and neo-liberal politics abroad for their markets and their investments will never go away (take an example of the war in Iraq). 

The author argues that PRSP process fails to adress the fundamental issues from several reasons: the poverty is viewed only as domestic problem, it is delinked with its roots in external global politics, the development agencies are not acting in accordance with the rhetoric of consultation, ownership and poverty reduction as they also need to struggle for survival and thus keep contributing to unstutainable high dept of South countries and channel their grants into programmes which sustain recipient’s capability to absorb debts. Also, it represents a “one fit all” approach as well as the SAP did because the concrete PRSP are made in the same fashion in order to make “the donors happy”. 

Formulation of PRSP is done within the arena of public policy. The most influental players are then the state (governance), donors (and mainly BWIs) and non-state actors. Gould is then exploring the changes in relations to this actors which the new conditionalities introduced. In general it can be said that new conditionality influences depolization of governance, transnationalization of political space and helps to consolidate hegemony of donor’s interests. This all introduces new configuration of power, mainly accumulated in the hands of transnational institutions like BWI.

Gould is explaining these changes into greater details by the help of three countries, I will focus on Honduras. Honduras is a small state with relatively high GDP. It was not a traditional recipient of international aid until the hurricane Mitch in 1998, which changed it and brought donor’s attention. It is important to say that despite this tragical event (hurricane Mitch), which changed life for so many people and significantly decreased the country’s economic growth, the poverty was not a real political priority for the politicans, as it was not conventional to deal it with. They were rather focused on security issues. Poverty was also exluded from the media, as they are owned by the same people. 

The events of 1998 led to the HIPC II initiative and then to the formulation of their own PRSP. It is very important, and the autor stress that a lot, that the PRSP and the donors opened up a political space in Honduras and de facto created there a civil society of NGOs. There was an old civil society represented by professional associations or trade unions but they did not participated in formulation of PRSP from various ideological and other reasons. It is also interesting that when the donors came into Honduras and started to participated into the politics, it was perceived as a good thing and not as a unwanted external influence.

The “voice of the poor” which is requested in the PRSP was represented by variety of NGOs. The important conlcusion of the book is that it does not mean that the poor were actually heard! NGOs in Honduras were composed by highly educated elite, economists from the same schools and technocrats and the poor were in fact exluded, as well as women and minorities.

But when I am thinking about Honduran NGOs, I can not imagine other kind of NGOs which could represent the poor better. It is unlikely that the actual poor would be able to run an NGO, stand for themselves and negotiate with governant or BWIs. Poverty is usually linked with low education. It is no coincidence that there appeared some kind of elite in NGOs as well as in state sector. I think it is a natural effect as the NGOs as well as any other companies need good stuff to be effective. 

There is an example in the book, that when the formulation of PRSP skipped the consultation with civil society, group of NGOs called Interforos stepped out and formulated their own poverty reduction strategy, which was than recognized by the BWI. I think it is an evidence that NGOs have power and protect the interest of the poor in Honduras.

Another effect on civil society, except its opening and creating new NGOs, is transnationalization. Donors helped civil society to overcome country borders, to link and network with similar organizations in the USA, Europe and so on. We can clearly see that new conditionality impacted NGOs and civil sector the most. In the case of state actors, there is not so much said in the book. The policy formulation was depoliticated and technocraticated. Also, the national parliament was exluded from the process of PRSP as well as it happend in most cases, not just in Honduras. 

I think, that the weak part of the book lies in the absent of deeper analysis of the state performance during the PRSP process and the new conditionality. I would appreciate greater inside into the governance and the exlusion of the parliament, as I do not understand why is that happening. On the other hand, the civil society was extremely well described and I can agree with most of the parts, as I presented in the text.  

One may think that Gould is extremely critical and undermine the new approach of PRSP as well as the BWIs, but you have to think about what change did it really bring. There are some cases where PRSP succeded, of course, but is it really just about poverty reduction? The main point of this book, as I see it, is that the new conditionality is not so different from SAP and the neo-liberal rhetoric still dominates. To combat poverty, it will never be enough to just increase spending in social services (like providing basic education and health care) and ignore the fundamental and global issues which represent the root of the problem. We can hope that the next PRSP will be step further and will introduced a real ownership, country-tailored solutions and actual poverty reduction.


Source: Gould J (ed) 2006: The New Conditionality – the Politics of Poverty Reduction Strategies Zed Books London