External constraints on policy making process in developing countries (1980-2006): A case study of Kenya

Abstract

The process of globalization combined with Bretton Wood's institutions rules is bound to significantly reduce the autonomy of government in the formulation of economic policy in their pursuit of industrialization and development. It's upon this view that the research project is concerned. The project focuses on the external constraints of policy making process in developing countries with special emphasis in Kenya. Kenya economic reorientation in the 1980s had been paradoxically both spurred and hobbled by the hostile international economic climate and the debt crisis. Kenya was reluctant to implement these reforms. However the period of policy based lending was followed by partial compliance and full compliance in some sectors of the economy after 1990. The over optimistic policy recommendations have led to a high incidence of shortfalls in performance eroding relations between the government and the international officials and accentuating the decline of public confidence in government's economic management. The project closes with a conclusion that the country have moved towards a more limited

state role in the economy and a more open stanc~ towards international economic ~- agencies. The international institutions have greatly eroded the sovereignty of state. They have almost entirely taken over the policy making role of the state. They have used aid conditionality to weak states like Kenya to ensure this. The shift in this approach is needed particularly with respect to policy dialogue that is genuinely two ways to better serve the goal of increasing government commitment and ownership of structural adjustment reforms.