World Bank, Development Delusion and Other Interesting Articles

Just read a great and informative article about the World Bank entitled “The World Banks Development Delusion”. The article briefly explores the history of the Bank and argues the need for change in the funding approach used by the World Bank, in its attempts to facilitate development and reduce poverty. The article made the following interesting points:

  • History shows that most of the countries that have come under the sway of the World Bank – and its sister institution, the IMF – have experienced declining development outcomes over the past 30 years or so.
  • Developing countries need much more control over decisions that affect them. Power in the World Bank is presently apportioned according to members’ shares, just like in a corporation. Major decisions require 85% of the vote, and the United States, which holds about 16% of the shares (and controls the presidency), wields de facto veto power. The same is true of the IMF. Developing countries together hold less than 50% of the vote, which is shocking given that the institution supposedly exists to promote their welfare. • Development aid should be delinked from corporate bonds. This would take Wall Street’s interests out of the equation, eliminate the pressure to siphon wealth from debtors, and allow the bank to evaluate its performance on the basis of poverty reduction outcomes instead of loan volume, as is the current practice. (http://www.thoughtleader.co.za/jasonhickel/2012/09/28/the-world-bank-and-the-development-delusion/)

The article also reminded me about the poem The Development Set. Yes, I know I always mention this but it’s only because it’s so true and I have yet to see any real evidence of development finance institutions trying to steer away from being tarred by the same brush that tarred “The Development Set”.

Should you wish to find out more on unsustainable aid, read the article on the World Bank and its development delusions and or read the poem The Development Set, check out the links below:

The need for Sustainable Aid

Aid, Development and the Development Set

The World Banks Development Delusion

Infrastructure Development and Funding

Millenium Development Goals: Time for a Rethink?

In September 2000 United Nations member countries agreed on eight goals aimed at encouraging development by improving social and economic conditions in the world’s poorest countries. These goals were adopted in the United Nations Millennium Declaration and are known as the Millennium Development Goals (MDGs).

In addition to the above aims, the MDGs’ intend to provide a framework for the entire international community to work towards a common goal focused on human development, poverty reduction and increased opportunity to access and benefit from global economy. The goals are as follows:

  • Goal 1: Eradicate Extreme Hunger and Poverty
  • Goal 2: Achieve Universal Primary Education
  • Goal 3: Promote Gender Equality and Empower Women
  • Goal 4: Reduce Child Mortality
  • Goal 5: Improve Maternal Health
  • Goal 6: Combat HIV/AIDS, Malaria and other diseases
  • Goal 7: Ensure Environmental Sustainability
  • Goal 8: Develop a Global Partnership for Development with developing countries, develop and implement strategies for decent and productive work for youth

As the target date (2015) for achieving the targets set for the MDG’s looms there is much debate on the success of the MDGs, whether they should be reviewed, re-defined or completely replaced.

According to a CESR article the first decade of progress against the MDGs revealed “the inadequacy of the international community’s efforts to meet commitments made a decade ago to fight poverty and other forms of deprivation such as hunger, disease and gender inequality.” In addition the 2011 UN report on the progress against the MDGs also revealed that between 2000-2010 progress against the MDGs’ had been inequitable and has in most instances bypassed the poorest, most vulnerable and disadvantaged sectors of the population who are meant to be the key beneficiaries of the MDGs’.

Thus it is evident that the MDGs despite being well-intentioned and aimed at facilitating human development have not necessarily hit their mark. There are various reasons and debates in relation to the success or failure of the MDGs. However, in my opinion the key issues requiring revision, re-thinking or attention are as follows;

1. The fact that the MDG targets are set for the world as a whole. An impact of looking at the MDGs as global targets is the fact that the development needs of specific countries and regions may be over looked. This is highlighted by the following UNDP statement;

“While the share of poor people is declining, the absolute number of the poor in South Asia and in sub-Saharan Africa is increasing.” (http://www.undp.ro/mdg/basic_facts) 

In other words: There is a significant need for locally defined MDG targets and not broad “world” based targets.

2. The MDGs’ are focused primarily on achieving targets as opposed to the process required to achieve the required development impact. This may be seen as limiting the scope of and reducing the impact of the development efforts. In other words: the “how” is just as important as the “what should be!”  Consequently, issues such as local needs and capacity should have been more effectively considered and integrated into the goal setting process.

3. The focus on numerical targets. Such targets are difficult to measure within the context of many of the less developed countries, which lack reliable data and the institutional and government capacity to collect and measure such data. Numerical targets do not always guarantee effectiveness or development impact.

“The problem of incomplete data has been recognized in Africa where most people are said to die or be born “without leaving a trace in any legal record or official statistics. In rural Africa, there are few hospitals, home births are common and assistance from a midwife or another health official rare.” (Katie Nguyen, Reuters Alert Net)

4. Aid does not necessarily result in development. The MDGs’ in many instances had the effect of focusing international aid flows specifically towards the attainment of MDGs’. This was based on the presumption that the MDGs’ are the optimal way of ensuring development and poverty alleviation. However, in certain instances this had the effect of misdirecting aid away from the real development issues within specific and local country contexts.

This sentiment is highlighted by Archbishop N Ndungane, as follows;

delivery on aid commitments have recorded a steady increase from 2004 through 2009. While it is a positive trend, it has created a tendency to focus more on aid in terms of the resources needed for the realisation of the MDGs than on the other sources. The recent global crises have come as a rude shock to remind us that this was a distortion and huge mistake”

The sentiment is also reiterated by the site; Globalissues, as follows;

“aid has often come with a price of its own for the developing nations:

  • Aid is often wasted on conditions that the recipient must use overpriced goods and services from donor countries
  • Most aid does not actually go to the poorest who would need it the most
  • Aid amounts are dwarfed by rich country protectionism that denies market 
access for poor country products, while rich nations use aid as a lever to 
open poor country markets to their products
  • Large projects or massive grand strategies often fail to help the vulnerable 
as money can often be embezzled away. 
It is time for these countries in need of development to call for justice and for the countries that once promised to help the world to actually fulfill their promises.” (http://www.globalissues.org)

These issues highlight the need to rethink the manner in which “development” and aid should be considered when the MDGs’ goals are assessed for impact and a post- MDGs’ framework or path is forged.

A continued focus on financial aid and development that does not effectively, equitably and sustainably consider local and regional contexts, capacities, needs and sensitivities will not only be a waste of resources both financial and natural, but also a waste of time. We need to prevent any further misdirected efforts especially within the context of increasing resource degradation, climate change and environmental vulnerability.

References, Articles, sites etc