Chapter 4


8. Further Elements of Structural Adjustment Programmes

8.1 Institutional reform

Institutional reform represents a further key element of structural adjustment programmes.
Close linkages exist, as already pointed out, to market reforms, especially in respect of
agricultural and food marketing where governmental and parastatal institutions have played a

prominent role in many countries. Some experiences with institutional reform measures are
recorded in Box 4.7.

Three main approaches to institutional reform can be distinguished:

1) increasing the efficiency of governmental/parastatal institutions,

2) abolition of government monopolies,

3) privatization of the institutions and their functions.

Sometimes all three of these approaches are applied simultaneously.

If, as intended, the institutional reforms bring about improved efficiency and effectiveness in
food marketing operations, this will enhance food security in various ways (see also Annex
1, par. 5):

1. higher prices for producers and

2. reliable and stable outlets, with positive effects on
 a) food production and
 b) farmers' income,

 3. lower prices and stable outlets for consumers, with positive effects on
 a) the real household income
 b) food consumption and

 4. an improved link between surplus and deficit regions, making better use of the
 available production potentials.


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