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Topic Discussion I
Politics of Hard Choices
Political Transition and Economic Restructuring
Room 4
(7 of 12 pages)
Speaker: I am not going to tackle the issues already tackled by the previous
speakers. There is one key issue when we are dealing with all the political and economic process and that is that
to win elections there must not be privatization of the power. The party which wins the election must have the
power as a way of developing the country but not to have the power as something private. Accordingly to our experience
we have involved as much as possible the opposition in the main decisions, mainly in parliament. But we also involve
the entire society when we are dealing with the main strategic visions of the country. For example, we are making
revisions to the constitution. There is a proposal in parliament by consensus which is now being submitted to the
people. We are discussing it with everyone at the grass roots. We know that structural reforms mean that many workers
will lose their jobs. How can we deal with this issue? We have what we call social conservation. Where the government
is represented the employee and the employer represented by the trade unions and they discuss everything from the
price of the basic product, salaries, up to which extends to increase the salaries in such a way that the economy
is not going to be affected but to guarantee that the workers have the minimum for them and their families.
The other element which is very important is that the media must be very well involved in all this because the
media has the power to inform in a society like ours in Mozambique. We use not only the media but when we have
a very important decision we create groups who go to the areas to inform the people. Of course it is not a perfect
process but some results have been seen. For instance we had introduced the multi party system in 1990 and we make
a consultation to the people and the people said no we want to stay with a single party system. They are very conservative.
We had a problem because we thought that the people would say yes go ahead, but we decided we should go ahead and
then we went back to them to say look you had very good ideas but the advantages of introducing a new system is
1, 2, 3, 4 so on. We had to do that and fortunately today people are saying okay we are in a good way. It's not
so easy. We still have many problems. We are in peace in Mozambique since 1992 and unfortunately for our history
we were in a very complicated war by the parties regime and they had used Mozambique people. But we said we have
to accept these people because they are Mozambicans and we accept that the minds of the people can be changed.
Actually they have changed their minds and they are acting very positively in the parliament. I can say that I
used to have a hard time to even shake hands with these people because they were killing people. But then we said
the best thing for the country is to forget because if you want to revisit this problem each time the revenge will
never stop. We must do everything in order to make all the sectors of society feel that there are an important
part of the process.
Speaker: I wanted to tell you of the experiences that we have had in Guyana to do with structural reforms.
I speak on behalf of the private sector. Of course it has been a very tough thing and I want to make clear that
the private sector has supported IMF programs and has clearly supported the idea of reform. We have just come out
of a 60 day strike of our public sector over the issue of wages. There may have been a few political competence
but this was a wage issue. The average public sector wage was 60 U.S. dollars a month. The unions understandably
were demanding 40%. Government within the IMF conditionalities could only offer 3.6%. Without going into great
detail I am pleased to tell you that the private sector was able to mediate an end to the strike. But this problem
is not going to go away. Far be it for me as a private sector person to lecture the IMF but I believe there is
need for more flexibility. If you have a 40% increase on a $60 wage we are at $84 dollars a month. Clearly that
is not going to cure it and it is also not going to allow us to restructure our public sector. If our public sector
is not restructured we have no revenue and therefore the problems will continue. We believe that the conditionalities
that were applied in this case were altogether too heavy and if we had been given more room we could have achieved
much more. We have no doubt that this issue is going to arise again very shortly. I was listening to our delegate
from Georgia speaking about adhering to conditionalities and I'd like to hear some more about that.
Speaker: I want to say something about how to educate in your country. In our country in El Salvador it
is a very small country with mostly the same language and almost one religion for six million people. Most of us
are similar and we don't have much differences but still we have had a lot of problems. What happened? Usually
information is power and most of the time we do not have access to information. Suddenly the politician says we
are very bad and we have to make very hard economic decisions. So then the people do not trust politicians and
it is very hard to agree with the propositions that they are making for example to improve fiscality or to restructure
the national budget. One of the problems we have had besides information is that the role that the opposition parties
have. Usually the opposition is always against the government and so they do not agree. People do not know in what
people or group they can trust and this creates another problem. In our experience what I have seen in international
banking we have said a lot of time that we would like to have the international agencies pay for our situation.
A lot of people in El Salvador do not pay taxes and we do not have the fiscal reforms as yet. We want money from
outside. We usually do not have the ability to restructure the budget or the expenses in the public administration
and I think that things are really against the possibilities of starting in a different way in our economy.
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