main quantitative target pertaining to fiscal policy in imf programs in ssa is government net domestic borrowing. as a fiscal target this has three drawbacks for a frontier market. first, with the deepening of domestic financial markets in these countries, and the possibility of attracting external portfolio investment into the domestic securities markets, rigid ceilings on government domestic borrowing are no longer as critical for macroeconomic stability as they were in the past. second, the domestic borrowing target imparts a pro - cyclical bias to fiscal policy ; when budget revenues fall because of lower than forecast economic activity, public spending must be cut to meet the target. third, it provides only a partial indicator of the stance of fiscal policy – its impact on aggregate demand – which is what matters for macroeconomic management. 5 a more comprehensive indicator would be an appropriate measure of the fiscal deficit, preferably a structural measure of the deficit to avoid a procyclical bias. monetary aggregates monetary aggregates as targets for monetary policy are an effective tool for bringing down inflation from high levels ( which was a priority in the 1990s ), but they are much less useful for controlling inflation when it is already at low levels, because of the instability of money demand. 6 monetary targets are also an impediment to the more activist, discretionary, monetary policy which is needed to meet the challenges facing macroeconomic management in the frontier markets. some form of an inflation targeting lite monetary policy framework is better suited to meeting these challenges ; a monetary policy framework which has been adopted by many emerging market central banks. retaining monetary targets in imf programs is an obstacle to the progressive reform of monetary policy in ssa. floors on net international reserves targets for international reserves are clearly needed for countries facing bop crises in which protecting the international reserves from further depletion is a policy priority. but it is difficult to understand why such targets should be accorded the same priority for countries which have accumulated large holdings of international reserves, equivalent to five or six months of imports and which face no immediate threat to their bop. in these circumstances the targets constrain the country ’ s capacity to use its own foreign exchange reserves for purposes of exchange rate management. exchange rate policies should be determined on their merits, not as a by - product of an imf program target which is intended for an entirely different purpose. for example, government spending from external grants and loans can make a substantial contribution to the fiscal stance without affecting net domestic borrowing. thornton ( 2008 ).

25 years ). this is despite their being substantial heterogeneity among ssa economies and the significant changes that have occurred within the same economies over the last 25 years. this begs three questions which i want to address. see brixova and ndikumana ( 2010 ) and imf ( 2010 ). imf ( 2008 ) sets out the rationale for the imf ’ s engagement in low income countries ( lics ). the imf perceives its role as extending far beyond support for the bop. instead this document states ( page 3 ) : “ fund engagement with lics over the past decade has been focused on supporting macroeconomic stability – its key global mandate – as part of broader development efforts to reduce poverty, raise growth and secure progress towards the millennium development goals ( mdgs ) ”. bis central bankers ’ speeches 1. is the technical design of the macroeconomic conditionalities in fund programs still appropriate for the macroeconomic challenges faced by all ssa economies, and in particular for the more advanced economies in the region ; the “ frontier markets ”? 2. should the imf be more open minded about heterodox policy measures which are being implemented by many emerging market economies in latin america and asia, and which are attracting interest among african policymakers? 3. is there still any value for ssa economies, which don ’ t face temporary bop problems and don ’ t need to borrow from the imf, in implementing imf programs? might these programs have actually become counterproductive? the technical design of imf programs in ssa i want to focus here on the design of the macroeconomic conditionalities of imf programs, which are fairly homogenous in ssa ( there is much greater heterogeneity in the structural conditions ). with very few exceptions, imf programs in africa comprise quantitative targets for monetary aggregates, net international reserves, government domestic borrowing and non concessional external borrowing. these are the key targets in an imf program ; in practice, it appears that the structural conditions are accorded less importance. one can argue that the quantitative targets are well suited to a certain type of economy facing specific challenges ; notably a low income economy with a very shallow financial sector, inadequate international reserve cover and for which the key macroeconomic challenge is to restore macroeconomic stability after a period of severe macroeconomic turbulence. this was the situation on uganda in the 1990s ( as well as many other ssa economies at that time