Macro-economic adjustment, uncertainty and domestic private investment in selected African counties

Abstract

During the late 1970s and early 1980s, many African countries embarked on economic policy reforms and adjustment programmes to correct macroeconomic imbalances, short-term internal disequilibria, and to meet the challenge of restoring long term economic growth. Adjustment policies to restore macroeconomic balances focused on bringing the level of aggregate demand and its composition into line with the level of aggregate output and available resources. The key areas of macroeconomic policy stabilization are fiscal and credit restrictions. In addition to demand-management policies, comprehensive supply-enhancing policy instruments have been initiated in many African countries since the late 1970s and early 1980s. The most common structural and sectoral reforms areas include: exchange rate and trade policy, agricultural policy, public enterprise reforms, and tax and expenditure policy.