Introduction - UNDP The Gambia

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dependent on the vagaries of the weather,
fluctuations in world commodity prices and
uncertainties over the level and quality of
external assistance.
The public sector has an enormous impact on
the lives of all citizens and significantly
contributes to the achievement of the goals of
sustainable development.
While the colonial power exercised stable
rule and provided some basic public goods,
the public institutions created were essentially
preoccupied with maintenance of the status
quo. They were by no means agents of
change and grassroots development.
Fortunately, the public service of postindependent
Gambia was relatively resilient
and had a distinctive culture and mission for
the achievement of growth, the eradication of
poverty and the improvement of the socioeconomic
welfare of the average Gambian.
During the first decade after the attainment of
political independence in 1965, The Gambia
achieved relatively high levels of economic
growth and performance. Unfortunately, the
combined effects of expansionary fiscal
policies, inadequate pricing policies
(including an over-valued exchange rate),
adverse weather and a serious deterioration of
the country’s terms of trade resulted in a
period of serious economic crises and
stagnation in the mid-1980s.
The public sector expanded considerably
during this period, with the civil service
doubling in size within a period of 10 years
(ie from 1975 to 1985). The uncontrolled
expansion of the civil service was prompted
by several factors including:
• political pressure to meet the demands of
the poor and vulnerable groups that
resulted in the government’s commitment
to address the problems of gender
inequality and provide essential services
for the poor, particularly in the fields of
education, health and rural infrastructure
• the need to reduce visible urban
unemployment
• limited expansion of private sector
employment
• lack of fiscal discipline, reflected in the
over-spending of recurrent resources and
the proliferation of below-the-line
accounts, which lacked monitoring and
transparency.
In 1984/1985, the annual inflation rate
reached 22 per cent and fiscal and external
current account deficits (excluding grants)
reached critical proportions of 12 per cent and
18 per cent of GDP respectively. Substantial
foreign borrowing led to an external debt that
peaked at 119 per cent of GDP, and arrears of
external payments escalated to 30 per cent of
GDP. The borrowing was largely focused on
capital investment in infrastructure and in the
development of education and health services.
In 1985, in order to reverse the economic
deterioration, the Economic Reform
Programme (ERP) was launched, with the
support of the World Bank and the
International Monetary Fund (IMF). Reforms
carried out in the context of the ERP and its
successor programme, the Programme for
Sustained Development (PSD), launched in
1990, focused on:
• a market-determined exchange rate
• liberalisation of the exchange and trade
regimes
• lifting of price controls
• scaling down of the public sector by over
35 per cent (including divestiture of about
20 public enterprises).
Structural adjustment reforms implemented
(including the re-organisation of key
ministries) supplemented by strengthened
fiscal and monetary policies contributed to
the:
• reduction of macro-economic imbalances
• reduction of the inflation rate to single
digit levels
• augmentation of Government savings
• restoration of external reserves to about
five months of imports by 1991/92 (as
opposed to one week in 1985).
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Building Capacity for the Attainment of the Millennium Development Goals in The Gambia National Human Development Report 2005
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