Structural adjustment loan

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Structural adjustment loan (SAL) is a type of loan to developing countries. They are one of the economic tools supported by the World Bank for structural adjustment. They carry policy conditionalities such as currency devaluation (to stimulate the supply of exports); the conversion of import quotas into import tariffs to reduce rent-seeking (and then tariff reduction in order to place more competitive pressure on inefficient infant industries); the removal (liberalization) of market controls in agriculture (to provide more incentives for farmers); and the reform of public expenditures and taxation (to shift more spending towards development priorities and to mobilize more public revenues to finance spending).^[1].

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