Why “shock therapy” structural adjustment failed in Russia

This information is provided by the person who participated in designing and implementing structural adjustment program in Russia. It failed:

1. The crisis in the Russian economy at the end of the twentieth century was the result of the unsuccessful reforms implemented by the democrats who had come to power;

2. The reason for those failures was the choice (“with the prompting of the IMF and other such agencies”) of “shock therapy” financial stabilization, and privatization;

3. The consequence of those failures and mistakes was the catastrophic decline in production, which led to the impoverishment of the nation;

Apply these lessons to Uganda and you will see parallels. Uganda was influenced in its structural adjustment program design and implementation by the same institutions that advised Russia.

The economic growth in Russia of recent years is the result of the regime’s new course – that is, of the correction of the mistakes made by the democrats (Yegor Gaidar 2012).

To get out of the economic mess, Uganda like Russia needs a new regime to correct NRM policy mistakes and failures. This will require professional and experienced leadership, not the one to learn on the job as NRM did.

Eric Kashambuzi