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MATTERS OF GOVERNANCE
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In September 2000, the world’s leaders adopted the United Nations millennium declaration, committing their nations to stronger global efforts to reduce poverty, improve health and promote peace, human rights and environmental sustainability. The millennium development goals that emerged from the declaration are specific, measurable targets, including the one for reducing — by 2015 — the extreme poverty that still grips more than 1 billion of the world’s people...

World leaders from countries rich and poor described the Monterrey conference as marking a compact between them in support of shared development goals...This compact calls on all stakeholders to orient their efforts towards ensuring the success of the goals, in a system of shared responsibilities. Poor countries can insist on increased donor assistance and better market access from rich countries...

The target date for the goals is just a dozen years away. And good governance and effective institutions in the poorest countries, though vital for success, will not be enough. Rich countries need to provide far more financing and better rules for the international system, as they have promised, to make the goals attainable in the poorest countries.

Meeting the goals should start with the recognition that each country must pursue a development strategy that meets its specific needs. National strategies should be based on solid evidence, good science and proper monitoring and evaluation. Within those bounds, poor countries require freedom of manoeuvre with donors to design locally appropriate policies. Without true ownership, national programmes will be neither appropriate to local conditions nor politically sustainable...

In the Eighties and much of the Nineties, many development efforts by international financial institutions and major donor countries were guided by the belief that market forces would lift all poor countries onto a path of self-sustaining economic growth. Globalization was seen as the great new motor of worldwide economic progress. Poor countries were assumed to be able to achieve economic growth as long as they pursued good economic governance, based on the precepts of macroeconomic stability, liberalization of markets and privatization of economic activity. Economic growth, in turn, was expected to bring widespread improvements in health, education, nutrition, housing and access to basic infrastructure, such as water and sanitation — enabling countries to break free of poverty.

Though this optimistic vision has proven hugely inadequate for hundreds of millions of poor people, it still has considerable merit for much of the world.

Despite protests against globalization in recent years, world market forces have contributed to economic growth and poverty reduction... But just as globalization has systematically benefitted some of the world’s regions, it has bypassed others as well as many groups within countries.

In the Nineties, most of east and south Asia saw living standards improve dramatically. But large parts of sub-Saharan Africa, parts of eastern Europe and the Commonwealth of Independent States and many countries in Latin America and the Middle East did not. In addition, epidemic diseases, most dramatically HIV/AIDS, prey disproportionately on those left behind and push them back even further — trapping poor people in a vicious cycle of poverty and disease...

There are many reasons economic development continues to bypass many of the world’s poorest people and places. One common reason is poor governance. When governments are corrupt, incompetent or unaccountable to their citizens, national economies falter. When income inequality is very high, rich people often control the political system and simply neglect poor people, forestalling broadly-based development. Similarly, if governments fail to invest adequately in the health and education of their people, economic growth will eventually peter out because of an insufficient number of healthy, skilled workers.

Without sound governance — in terms of economic policies, human rights, well-functioning institutions and democratic political participation — no country with low human development can expect long-term success in its development efforts or expanded support from donor countries. Though many observers would simply lecture poor people to do better on their own, most poor countries face severe structural problems far beyond their control...

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