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Social Justice and Privatization

In 1999, as part of the International Monetary Fund’s (IMF) Highly Indebted Poor Countries Initiative (HIPC), the IMF required the Nicaraguan government to privatize their national electric power company. The main reason for the IMF’s request was the power company’s negative impact on the national budget. Fifteen years later, the quality of the electrical service has improved significantly. Power outages that were once the norm are few and far between. However, these improvements have not come without costs, literally. The cost of electricity has more than quadrupled.

For this Discussion, consider Nicaragua’s experience. Think about how privatization can be a positive policy tool and its implications for social justice.

Post by Day 4 your perspective on whether privatization is a positive public policy tool. Why or why not? Then, explain at least two implications of privatization from a social justice perspective.

Be sure to support your postings and responses with specific references to the Learning Resources.

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