Post 1: Creating Sustainable Growth in Developing Countries
Jacqueline Novogratz, in her TED Talk “Invest in Africa’s Own Solutions”, goes into the perceptions of poverty and how they are skewed for most people. She points out that often people think of the poor as anyone living below four dollars a day. However, she says it’s important to realize that it’s much more of a complex issue than just income. Poverty is linked with fear, ethnic strife, bad living conditions, all of these are factors. People living below four dollars, when you aggregate it, make up the 3rd largest economy in the world. Her main message is that for aid in impoverished countries, the key is to build small, make it infinitely expandable and affordable to the poor. “The only way to end poverty, to make it history, is to build viable systems, on the ground, that deliver critical and affordable goods and services to the poor, in ways that are financially sustainable and scalable” By doing this, and encouraging the local communities to invest in themselves, these countries CAN be helped out of poverty. Sustainable Development Goals, an extension of the Millennium Development Goals, were set in order to foster an international system of aid for impoverished peoples. These goals, such as lowering the deaths of children or getting more of them into primary school, were intended as a guide by which developed countries could take initiative and focus on helping developing nations. SDG’s call for socially inclusive and environmentally sustainable growth, to help developing countries to become more self-sufficient. Peaking in the later 90’s, neoliberalism has had profound effects on foreign aid, especially from countries like the US. In 1997, The US’s total foreign aid hit .09% of the gross national income, an all time low. The World Bank and IMF put conditions on aid to foreign governments, if they wanted to receive aid. The ensuing cuts in social programs led to a stagnation in these countries, with rising poverty and child mortality, along with a fall in life expectancy. In Own The Goals, John McArthur details how the developed countries of the world, like the US, implemented the SDG’s and how they held back. In the 2000’s, the Bush administration voiced their support of the Millennium Declaration, but not of the MDG’s. They claimed that the MDG’s were ‘UN dictated aid quotas”. Eventually, the US embraced the MDG’s, but not before missing an opportunity to enhance relations with developing countries. By rejecting the concept, not the content, of the MDG’s, the Bush administration held itself back internationally for several years. “The MDG’s have helped mobilize and guide development efforts by emphasizing outcomes…They have shown how much can be achieved when ambitious and specific targets are matched with rigorous thinking, serious resources, and a collaborative global spirit” He criticizes countries like the US and organizations like the World Bank, who drug their feet on actual aid commitments. The World Bank championed MDG efforts at the top level, but failed to get such efforts moving on the ground. In “How to Help Poor Countries”, questions about the efficacy of foreign aid are raised. How can the greatest effect be reached, and does this aid directly influence quality of life? In practice, it is not just the amount of aid but the way that it is implemented that’s important. “Greater opportunities for poor and less skilled workers to move across borders would, more than anything else, increase both the efficiency of resource allocation in the world economy and the incomes of the citizens of poor countries” In order for aid to work, it needs to be effectively implemented to help the correct sections of people. In instances of poor governing bodies, aid funds are mismanaged and often stolen, leading to incredible waste and worsening conditions. The goal is to create sustainable development, to help these developing countries to grow in a healthy way that will continue for many years. McArthur says, “sustainable progress is in the hands of the poor countries themselves” but also, “developed countries should not abandon the poor to their plight”. One consistent point made by several of these speakers/authors, is that incentive is key. In order to encourage these countries to climb out of poverty, the incentive has to be visible and beneficial to the people. Capitalism is a system that relies on profit as a motivator, the end-all-be-all for economic stimulus. By building profitable relationships with these developing countries, the US and other nations like it can help to raise the living standards and well being of everyone.