Description:
At the end of the Cold War the west imposed economic "shock therapy" on the countries of the former Soviet Union to rapidly turn the communists into capitalists, creating oligarchs. One of the few Africa countries where shock therapy was imposed was Mozambique. Shock therapy was intended to push the communist elite who had power over land, resources and contracts to take control of those assets and then make deals with the west to exploit them. They became, in effect, rentier and comprador capitalists. Mozambique was poor and only small oligarchs were created, but they made their links with western capital and donors. The outcome, the World Bank admits, is that Mozambique showed remarkable growth, which largely benefitted the oligarchs and foreign companies and agencies, while poverty and inequality grew to record levels. This paper shows the intense and brutal way the IMF and World Bank imposed shock therapy on Mozambique.