Unpacking the African Response to Radical Neoliberal Policies

This study empirically examines how African economies respond to radical neoliberal reform policies, using panel data from 29 African nations between 1990 and 2022 and the Vector Error Correction Model. The overall response remains underexplored, as most studies are qualitative in nature. The findings reveal that African economies respond negatively to several of the radical neoliberal reform policies which include: (1) drastic cuts in public and social spending which leads to food insecurity and balance of payments crises, (2) free trade which accelerates deindustrialization and reverses development trends; and (3) deregulation which transforms these economies into "jungles," hindering environmental management. Radical neoliberal reform policies, such as lower taxes on large corporations and currency devaluation, further limit revenue sources, create an import crisis, and exacerbate technological underdevelopment. Overall, the study finds that these policies worsen and prolong the developmental challenges they aimed to address. These outcomes expose the hypocrisy of the RNPs, which promise development but instead reinforce development challenges. These findings are crucial for African economies, as their success hinges on how effectively they address the issue of ‘policy hypocrisy’. The paper concludes by proposing policy solutions to address this issue.