PHM-Exch> The need for a new development paradigm

[Claudio Schuftan]

The need for a new development paradigm

*Francine Mestrum* – MEER*

*Taking the opportunity of the upcoming UN summit meetings*

‘We need to put the world back on track’! The objective of the SDG-summit
to be held at the UN General Assembly Meeting in September in New York is
very clear. Halfway on the road to 2030, the end date for the achievement
of the Sustainable Development Goals, the future looks rather bleak. If
nothing changes, it may well be that none of the seventeen goals will be
met. It would be a serious blow to all UN efforts to build a world of
‘development’, economically, socially, politically and culturally.

One may have serious doubts and criticism about these objectives, but they
are among the best our world has ever produced. Whatever the perspective,
from North or South, from modernity or post-colonialism, one cannot deny
the importance of teaching children to read and write, to have all people
live in good health, and to build a world without poverty and with reduced
inequalities. Our world is so immensely rich that it is difficult to
understand why this does not happen.

Many answers are possible. One may refer to the recent pandemic, to bad
governance, to unfair trade and terms of trade, or to the remnants of
colonialism. All this may be true though; none of these explanations can be
sufficient.

It cannot be denied that colonialism and the slave trade have seriously
damaged African societies. But just imagine that all the development
theories and programmes made and promised after the Second World War and
the decolonisation of the 1960s had come true, would the world not be
different today?

Again there are several possible explanations, such as the inadequacy of
theories and programmes, their imperfect implementation, or the lack of
political will to have them come true.

Just look at the numbers.

In 1971 the first UNCTAD list of ‘Least Developed Countries’ counted 25
extremely poor countries. In 1991 there were 52 already, until now only 6
countries ‘graduated’ and 46 are still on the list. In other words, there
are, today, more very poor countries than fifty years ago.

Thirty-six of these countries are commodity-dependent and are net providers
of most ecological resources to the world market. However, since 2010 their
share of global merchandise exports remains at around 1%, according to
UNCTAD.

As for their debt service, it more than tripled since 2011 and absorbs 5 to
13% of the value of their exports. According to World Bank statistics, the
headcount for extreme poverty rate is now close to 10%, amounting to more
than 700 million people. Even if the Bank pleads for a ‘correcting course’,
it does remain with its recommendations to ‘better target’ and ‘promote
growth’. And let us not forget that the poverty reduction since 1981 is
mainly the result of China’s efforts!

For the first time since the indicators were introduced, human development
is declining. The World Bank’s ‘shared prosperity’ works backward: the
poorest 40% lost income twice as high as those of the richest 20%. There
are setbacks in education and health.

As for inequality, Oxfam states that since 2020, the richest 1% have
captured almost two-thirds of all new wealth – nearly twice as much money
as the bottom 99% of the world’s population. Billionaire fortunes are
increasing by $2.7bn a day, even as inflation outpaces the wages of at
least 1.7 billion workers, more than the population of India. Food and
energy companies more than doubled their profits in 2022, paying out $257bn
to wealthy shareholders, while over 800 million people went to bed hungry.
Only 4 cents in every dollar of tax revenue comes from wealth taxes, and
half the world’s billionaires live in countries with no inheritance tax on
money they give to their children. A tax of up to 5% on the world’s
multi-millionaires and billionaires could raise $1.7 trillion a year,
enough to lift 2 billion people out of poverty and fund a global plan to
end hunger.

Faced with all the different consequences of climate change, from droughts
to floods, more and more people are trying to migrate, only to clash with
racism and the unwillingness of rich countries to help.

This is the state of today’s world.

*Old truths*

Reading the old texts of the United Nations from the 1960s and 1970s, one
is surprised to read about many policies that could indeed ‘correct
course’, such as technology transfers, fair prices for commodities,
equitable terms of trade, monitoring transnational corporations, sufficient
aid, etc. A couple of specific texts such as the General Assembly
Declaration on a New International Economic order (NIEO) or the 1986
Declaration on the Right to Development are taken up again today because
they never had any beginning of implementation and do indeed have very
interesting viewpoints.

One can only hope these efforts will lead to policy changes because the
current inequalities are simply not sustainable.

In a new document for a New Financial Architecture, the UN
Secretary-General states that the current model has failed the stress test
and is simply not fit for purpose, it lacks stability and possibilities for
long-term financing. Borrowing costs are too high and there is
underinvestment in global public goods. He therefore makes new proposals
for global economic governance with debt relief, international public
financing, global financial safety nets, regulatory measures for capital
markets and a global tax architecture.

One obviously can think this does not go far enough but we can be sure that
for the ‘Summit of the Future’, planned in 2024, many compromises will have
to be made.

The most important point however is the awareness that the current model
does not work and that we necessarily have to look for a new development
paradigm.

The UN can be an important source of inspiration with its current work and
also with its past ideas on the NIEO, the ‘unified approach’ concept
(integrating economic and social development), the right to development,
the Universal Declaration on human rights with its right to an adequate
standard of living, coupled to the important progress at the ILO
(International Labour Organisation) concerning labour rights. The recent
document of the Human Rights Council on the Right to Development, coupled
with social protection can be a real and immediate help.

Another source of inspiration can be found in the efforts made in the
starting years of the Soviet Union as well as the many proposals from
African leaders in the period up to decolonisation.

All these solutions, though, will require transforming the economic and
financial structure.

*Shifting geopolitics*

The bleak outlook for the poorest countries could make us forget that some
countries did do well these past decades. The foremost example is obviously
China, but also Brazil, India, South Africa, Mexico and some others. The
sad thing is that in spite of the economic success, there is not always
equal progress in democratic and social terms.

There is also a serious setback in terms of academic research and civil
society actions. Research on development stalled, too many people reject
the concept as being too ‘western’ or has changed track, passing from
‘improving the world’ to ‘improving people’s lives’. There is nothing wrong
with this second perspective, but it cannot succeed if there are no
structural changes in how the world is turning around. Development
necessarily is a collective endeavour and can never become a reality if the
world itself is not ‘developed’. In fact, with its priority for ‘poverty
reduction’, introduced in 1990, the World Bank abandoned the development
project for countries and societies.

As for civil society, the sad reality is that only a handful of big
movements still have a global and systemic agenda, mostly also taking into
account the urgent needs of care for the planet. The huge number of smaller
movements and organisations are very fragmented, limited to community
scales and spreading a moral discourse beyond that. Vijay Prashad calls it
‘neoliberalism from below’.

In brief, it seems there are three important lessons to be learned from the
past.

One, development in terms of human rights, basic productive activities,
social protection, democracy and cultural expression remains a worthy goal.
New theories and new concepts should be developed to revalue the idea and
help countries and societies reach their goals. One cannot deny there were
real developmental aspirations in all countries that were de-colonized in
the 20th century.

Secondly, one should never forget development necessarily comes from within
and can never be brought from the outside. Obviously, the international
community can help, most of all financially, but governments and societies
should decide for themselves what kind of development and what modernity
they want.

Thirdly, there is much talk today of strategic autonomy, a concept en
vogue. This is very important, though it should never replace the old and
important interdependence. This is a primary condition for peace and
requires a well-functioning multilateral or unilateral system. The
international institutional order should be examined and transformed from
this perspective.

Today, there is again a huge gap between words and things, between what the
UN and even the World Bank and the IMF preach, and the reality on the
ground. This gap should be filled as much as possible. It is the root of
many discourses rejecting all kinds of modernisation and development
because people reject with good reason the practice of the past. However,
they do not reject the ideas. Colonialism and neocolonialism have been very
damaging. What is called ‘the West’, responsible for this damage, is
currently losing its global influence. Faced with this fact, one should
look at the past and at the future. It is far from sure that hegemonic
powers will disappear and there is no certainty that the future will be
better than the present and the recent past. As for the past, recent
research is teaching us that this Western experience is nothing
exceptional. For centuries, if not millennia, people have been subdued and
exploited.

A very positive and recent development is the growing South-South
cooperation. Even if it now lacks a clear democratic dimension, the BRICS
(Brazil, Russia, India, China and South Africa) initiative could show a
different way to take into account people’s real needs and aspirations.

The concept of development, however vilified it may be, still contains an
element of utopia, equality, freedom and solidarity. Moreover, it is
crystal clear that global development is perfectly possible if there is
political will, at the local and national as well as the global level.

A first step should be to support all new U.N. efforts for democratising
reform and transformational policies. Moreover, the Universal Declaration
on Human Rights is 75 years old. It deserves to be put in the spotlights.
Most of all, we should stop doing ‘as if’ everything went well and we will
soon be back on track. We will not be without a strong and united voice of
resistance.
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