THE TWO PHASES OF STRUCTURAL ADJUSTMENT/161domestic prices. Domestic prices for food are increasingly aligned
with world market prices.
After the 'Fuji-shock' in Peru - dictated by the World Bank and the
IMF and implemented by President Alberto Fujimori in 1991 - the
price of petrol increased by 3,000 per cent overnight, that of bread by
1,100 per cent. Yet the minimum wage fell by more than 90 per cent
(compared to 19 7 5). In August 19 9 0, an agricultural worker in the
northern provinces made S 7.50 per month; at the same time, many
basic goods cost more in Lima than in New York (Chossudovsky,
1994).
This new global economic order - based on the internationalisa-
tion of goods prices and a fully integrated world market - operates
with two distinct 'labour markets', increasingly cut off from one
another. In other words, this global market system is characterised
by a dual structure for wages and labour costs, separating countries
of the periphery and those of the centre. While prices are unified and
aligned with those of the world market, wages (and the cost of labour)
in the Third World and Eastern Europe are on average 10-20 times
lower than those in OECD countries. Furthermore, with the closure
of US and Western European borders, the South's workforce can no
longer circulate freely and sell its labour in the countries of the North.
This fortifies the barriers separating labour markets on a global scale.
Reducing the Role of the State and Eliminating
Autonomous National Projects
The World Bank stresses the huge stakes involved in the quest to
reduce the role of the state:
Of the world's 2.5 billion workers, 1.4 billion live in countries
facing the difficult task of definitively emerging from a system of
state intervention, excessive protectionism and centralised
planning ... (World Bank, 1995)In sub-Saharan Africa, Latin America and South Asia, most
countries have pursued differing degrees of autonomous
development that protected certain industries and discriminated
against agriculture. These strategies benefited a limited number of
privileged people (holders of capital and workers employed in the
protected sector). Privileges were often defended with intervention