Turn the page on poverty

The world’s poorest countries need a better outcome

Barry CoatesOxfam New Zealand Executive Director Barry Coates joined world leaders at the Fourth UN Conference on Least Developed Countries (LDCs) in Istanbul, Turkey. The conference seeked to address the problems hindering the development of the world's poorest 48 countries.

An opportunity for action

This conference should be an opportunity to capture an emerging consensus on new development thinking and action. The current conference has to some extent represented a departure from the excessive emphasis on economic liberalisation that was embodied in the Brussels Programme of Action (BPoA) in 2001.

An evaluation of the BPoA showed progress in some areas, such as improved access to primary education, including for girls, an increase in the numbers of countries with democratic elections, and lower levels of infant mortality. But, despite relatively high levels of economic growth in recent years, averaging 7 per cent for some LDCs, over half the LDCs’ people still have income of less than US$1.25 per day and 75 per cent below US$2 per day. They also have made slow progress on most dimensions of human development. Most LDCs are likely to miss most of the MDG targets.

Economic growth needs to be equitable and sustainable

A problem is that economic growth has relied heavily on high commodity prices and a model of resource extraction that is not equitable or sustainable. Not many LDCs have managed to diversify their economies away from dependence on a few commodities, and most exports are unprocessed, without the value-added production that could generate jobs and opportunities for a growing number of young women and men.

The weaknesses in this approach to development were well documented by UNCTAD in The Least Developed Countries Report 2010: Towards a New International Development Architecture for LDCs. The report was sharply critical of the failure of the developed countries to implement their undertakings. It also included insightful analysis about the need for an active government policy to build economic capacity and coordinate development, as well as fundamental changes in the international development architecture.

The analysis and recommendations from this UNCTAD report were influential in forming a basis for the Istanbul Programme of Action, submitted by LDCs. As a result, the initial drafts tabled by LDCs included an emphasis on the need to build productive capacity; an integrated approach to agriculture and food security; trade reform; a call for more financial support; investment in human and social development; strengthened resilience to economic shocks; climate change and natural disasters; and good governance. These proposals included targets and timetables.

However, this agenda has been systematically weakened in negotiations, with the development partners (ie. developed countries) contesting the more progressive provisions in the draft and taking out any targets and timetables that may imply obligations for the developed countries. Still, the “shadow” of the LDCs’ proposals remain in the Programme of Action and these provide an important guide to new thinking on development for LDCs.

The need for partnership across all countries

The negotiations were marked by the strenuous efforts of the developed countries to force differentiation amongst developing countries by insisting that issues such as aid targets should include similar targets for the major developing countries, notably China. Predictably this was not agreed – it is the same issue that has at least partly been responsible for paralysis in other forums such as WTO Doha negotiations and UNFCCC negotiations. This issue soured the negotiations and squandered any sense of shared partnership involving all countries. It left negotiations divided along familiar oppositional lines between developed countries and the developing countries (in the so-called G77 grouping).

One of the casualties of the removal of the targets and timetables from the negotiations is the difficulty to hold governments to account for implementation of the Programme of Action over the next year. This is exacerbated by the lack of a peer review process and any high level review of progress.

Civil society working together

The Istanbul Conference precedes the start of a Civil Society Forum (I am on the international Civil Society Steering Committee). There are around 1200 civil society representatives, almost all from the 48 LDCs. The CSF is providing a great opportunity for networking and joint work, facilitated by the formation of four tracks for: formation of groups on thematic issues; awareness raising and campaigns; monitoring the implementation of the Programme of Action to hold government to account; and influence over the ongoing negotiations.

There is also a private sector track and I have been involved in some of those meetings. I have been left with a concern that there is a rather naïve enthusiasm amongst aid agencies for private sector as the main “engine for growth”, and commitments of aid funding to “provide incentives” for foreign investors or support for domestic business. It seems somewhat ironic that this new enthusiasm is coming from many of the same governments that are trying to outlaw domestic subsidies and export subsidies in forums like the WTO and regional trade agreements. The danger is that much of the funding previously provided to support governments in capacity building and human development will be diverted to private sector, and that much of the benefit from the aid will be captured by private companies rather than those who really need the support.

850 million people need a better outcome

The conference will conclude on Friday. There will be an aim agreed in the political declaration to ensure that half of today’s LDCs will graduate within a decade, but sadly, little commitment to making that aim a reality. The lack of commitment from the international community, the rich nations in particular, has been deeply disappointing.

The 850 million people in the LDCs, facing new crises of food prices, climate change and financial speculation, need a better outcome.

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