Laurent Bossard, Director, OECD Sahel and West Africa Club (SWAC) Secretariat
In the second of the SWAC/OECD Secretariat’s West African Papers series (“Climate Impacts in the Sahel and West Africa: The Role of Climate Science in Policy Making”), Carlo Buontempo and Kirsty Lewis of the Met Office UK consider the role climate science plays in policy making.
I had thought about calling this blog: “Don’t leave climate change policy solely to climate scientists!”. After all, the authors themselves stress that climate scientists are not necessarily fully equipped to identify what the key components of climate and climate change are in relation to a population’s needs. In the end, I resisted the temptation because I sincerely admire this profession whose daunting task it is to help us build a better future for the planet.
The question is: “how can the terabytes of data generated by the Intergovernmental Panel on Climate Change (IPCC) climate models be of use to African farmers?”. If a farmer is asked what they need, their reply will probably be for more accurate and local short-term weather forecasts to ensure that their seeds are sown at the right time. It would seem therefore that a distinction has to be made between meteorologists – who are likely to cater to the farmer’s request – and climate scientists.
The authors of this paper remind us that climate change is not just about a change in climate towards hotter, wetter, and drier conditions, but also about an increase in the variability of the climate, as well as in the number and severity of extreme events. So yes, it would be very useful to provide more accurate weather forecasts but, for all this, the need to factor in the structural dynamics associated with climate change would remain unaddressed. Helping farmers to anticipate these dynamics and manage risk is what a “climate service” should be able to offer its African users.
Everybody seems to agree on this issue but the “how” is apparently still far from being resolved. The argument developed in this paper is that agricultural and rural communities should be listened to in order to understand how the “climate factor” fits in with their specific problems, opportunities and prospects. The climate factor does not, therefore, replace all other issues faced by African farmers, but is an addition to them. The climate factor could thus be of central importance or less relevant, a triggering or aggravating mechanism, all depending on the context. As a result, importance should be placed upon defining the issues and asking the right questions.
I believe this message is important because it reminds us of the importance of the “human factor”. Back in 1967, a teacher named Lédéa-Bernard Ouedraogo, from Yatenga province in what is now Burkina Faso, decided to create a “Naam group” in his village – an adaptation of the traditional Mossi community association called Kombi-Naam, or “power to young people”. A form of agricultural and environmental cooperative, the Naam was constructed on the following five pillars which define its actions: its members, what they know, what they experience, what they know how to do and what they want. Accordingly, the Naam creates projects which are tailored to the environment, which meet the needs of its members and which are achievable. It is, in essence, a tool which promotes and develops local expertise.
The initiative has now spread throughout Yatenga province and the entire country. The National Federation of Naam Groups now comprises over 5 000 groups and over 600 000 members. Building on the Naam network, Lédéa Bernard Ouedraogo was one of the creators of the 6S Association (“Savoir se servir de la saison sèche en savane et au Sahel”) in 1976. The National Federation of Naam Groups and the 6S Association formed the basis for disseminating straightforward, effective techniques for what is now known as “climate smart” agriculture. As a result, we see that areas where climate scientists might once have said crops could no longer grow because of a lack of rain, are now using “Zaï” (30cm in diametre micro-basins scattered throughout the fields) and “boulis” (small catchments for storing water run-off).
During the 1980s when Niger’s Maradi region was severely affected by aridification, farmers had the idea of allowing trees to grow naturally in their fields. These trees help to protect against wind and soil erosion, enrich the soil with the manure of animals taking refuge in their shade, and limit temperature and evaporation, and thus effectively reduce the need for water. According to the French Agricultural Research Centre for International Development, “assisted natural regeneration” has made it possible to regenerate hundreds of thousands of hectares of land not only in Niger but also in Burkina Faso, Mali and Chad.
The IPCC did not exist in the 1970s and early 1980s and when I read this paper, I wondered what the teacher and the climate scientist might have said to one another had they met in Yatenga. I believe that such an encounter between the science of mathematical models and the science of traditional knowledge would have been mutually beneficial and that the need to further co-ordinate efforts between disciplines, sectors and other fields of development is becoming increasingly essential.
OECD Sahel and West Africa Club (SWAC)
Two themes that resonate strongly across the OECD are the need to achieve sustainable development and the growing significance of population ageing. It is rare, however, that these two agendas are brought together to consider the importance of ageing for developing countries.
It is all the more surprising given that population ageing is a global phenomenon acutely affecting developing countries. The numbers speak for themselves: in 2014, there were 868 million people over the age of 60 in the world – 12 per cent of the total population. By 2030, this will increase to 1.2 billion or 16 per cent of the population; and looking ahead to 2050, current estimates suggest there will be 2.03 billion older people worldwide – 21 per cent of the population. By 2047, there will be more adults over the age of 60 than children 16 and under for the first time in human history.
This is a reality for developing countries today. 62 per cent of people aged 60 and over live in developing countries and this is expected to increase to 80 per cent by 2050. What is more important is the pace of the change taking place in lower and middle-income countries. The demographic landscape is changing radically in many parts of Asia and Latin America, offering little time for governments in these countries to adapt. Even in sub-Saharan Africa, given the trends of increased longevity and economic development, it should be fully expected that the ‘youth bulge’ will become an ‘older person bulge’ within a few short generations.
So what does this mean for efforts to tackle poverty, inequality and climate change? At its simplest, we need to be asking ourselves the question: does our understanding of development include older people? Not taking older people into account means excluding up to 20 per cent of the world’s population. In this regard, the post-2015 sustainable development goal (SDG) agenda marks a turning point in recognising ageing and older people as part of the development process. The SDG negotiations have already made it clear that addressing the rights and needs of older people is integral to the ambition of “leave no one behind”.
At a deeper level, it forces us to reconsider basic assumptions of what it means to be productive in society and what the role of older people is. All too often policy makers, planners and development practitioners assume that life takes place in three stages: childhood (dependency); adulthood (productivity); later life (dependency). This simplistic understanding could not be further from the truth and masks a huge diversity of economic activity and social interactions at all stages of life.
Hidden from view is the contribution grandparents who have pensions make to improving children’s education and nutrition. There is no calculation that captures the economic value of an older nurse that provides healthcare services on a voluntary basis in her community, having already been identified as ‘retired’ and ‘non-productive’. There are no figures that adequately value care and support by and for people of all ages in lower and middle-income countries.
In the context of achieving the soon to be agreed SDG framework, the promise of a ‘data revolution’ and the commitments to disaggregating data by age offer some hope that this situation can change. But any analysis must capture data at all stages of a person’s life. Without a better understanding of ageing and development, we risk investing in development and building programmes that do not know where poverty and inequality lie. Disaggregating data by age, gender and disability is not an expensive add-on to the SDG framework, but is the very bedrock upon which effective decisions can be made and must be invested in.
Another critical lesson that the ‘leave no-one behind’ agenda provides is that the essential building blocks for building sustainable, peaceful and equitable societies are the very individuals within those communities. Without a better understanding of ageing and development, we fail to capture adequately the potential of individuals of all ages and abilities within society. Living in better health longer allows older people to contribute more to building resilience in disaster-prone areas. Having access to finance can mean better income and nutrition for older farmers and their families. Getting appropriate healthcare for grandparents can mean children spending more time in education.
Ageing is a development fact. There should be no value judgement attached to this statement or to a person’s chronological age, whether they are young or old. Older people are carers, teachers, farmers, athletes, market traders, labourers, professionals, and Nobel laureates. Older people can also be frail and living with chronic illness, dementia or disability. The important thing is that we do not keep ageing hidden from view. We also need to have the courage to challenge our preconceptions of what getting older means to enable policies to emerge that are fit for purpose for our rapidly ageing societies.
This article is based on a collection of essays called Facing the facts: the truth about ageing and development produced by Age International.
The Disaster Risk and Age Index from HelpAge ranks 190 countries based on the disaster risk faced by older people.
Today’s post is by Johannes Jütting, Manager of the Partnership in Statistics for Development in the 21st Century (PARIS21), which promotes the better use and production of statistics in developing countries. PARIS21’s new report, A Road Map for a Country-led Data Revolution, sets out a detailed programme to ensure developing countries can monitor the Sustainable Development Goals and benefit from technological and other innovations in data collection and dissemination.
Tradition tells us that more than 3,000 years ago, Moses went to the top of Mount Sinai and came back down with 10 commandments. When the world’s presidents and prime ministers go to the top of the Sustainable Development Goals (SDGs) mountain in New York late this summer they will come down with not 10 commandments but 169. Too many?
Some people certainly think so. “Stupid development goals,” The Economist said recently. It argued that the 17 SDGs and roughly 169 targets should “honour Moses and be pruned to ten goals”. Others disagree. In a report for the Overseas Development Institute, May Miller-Dawkins, warned of the dangers of letting practicality “blunt ambition”. She backed SDGs with “high ambition”.
The debate over the “right” number of goals and targets is interesting, important even. But it misses a key point: No matter how many goals and targets are finally agreed, if we can’t measure their real impact on people’s lives, on our societies and on the environment, then they risk becoming irrelevant.
Unfortunately, we already know that many developing countries have problems compiling even basic social and economic statistics, never mind the complex web of data that will be needed to monitor the SDGs. A few examples: In 2013, about 35% of all live births were not officially registered worldwide, rising to two-thirds in developing countries. In Africa, just seven countries have data on their total number of landholders and women landholders, and none have data from before 2004. Last but not least, fast-changing economies and associated measurement challenges mean we are not sure today if we have worldwide a billion people living in extreme poverty, half a billion or more than a billion.
Why does this matter? Without adequate data, we cannot identify the problems that planning and policymaking need to address. We also cannot judge if governments and others are meeting their commitments. As a report from the Centre for Global Development notes, “Data […] serve as a ‘currency’ for accountability among and within governments, citizens, and civil society at large, and they can be used to hold development agencies accountable.”
So data matters. Despite this, blank spaces persist in the statistics of many developing countries. And they persist even at a time when the world is experiencing a “data revolution” – a rising deluge of data matched by ever-increasing demand for data.
Despite the challenges, we are optimistic that all countries, including the poorer ones, can make quick, dramatic progress in meeting their data challenges. Firstly, there is not only a growing awareness of the problems countries are facing but also a growing willingness to do something about it. Statistical offices in almost 40 developing countries have signed up to our Data Declaration, in which they state that “the time is now to bring the data revolution to everyone, everywhere”.
Second, new technologies are already helping to revolutionise the world of data. PARIS21’s Innovations Inventory has compiled hundreds of ways in which technology is making it easier and less costly to collect data and providing new sources of data, like “big data”. Examples abound, from NGO to private sector initiatives. As part of its Data for Development (D4D) challenge, Orange Senegal opened up its mobile-phone call-log data for researchers to generate insights into health, transportation, demographics, income inequality, and more. Another truly “Big Idea” comes from Restless Development, a youth-led development agency that equips young people with knowledge, skills, and platforms necessary to effectively interpret data in order to mobilise citizens to take action.
Third, we are optimistic because we want to build on what is already there – existing national statistical systems. Clearly, many are far from ready to join the data revolution; a colleague recalls visiting one national statistical office that couldn’t pay its power bill and had to negotiate with a neighbour to string an extension cord from his home to the office. That may be an extreme example, but other challenges – including technology gaps, shortages of trained staff, weak data dissemination and poor relations with users – are all too common. Nevertheless, national statistical agencies are the only entities with the expertise and legal frameworks to play the lead role in collecting, processing and disseminating data. It is on them that the data revolution for development for sustainable development must be built.
Of course, our Road Map for a Country-led Data Revolution is only a start. Much else needs to happen. This includes designing pilot projects, finding better ways to integrate new sources of data in existing national systems and – unsurprisingly – finding extra funding. But here again we are optimistic. We don’t accept that the cost of monitoring the SDGs will be “crippling”. With our colleagues in the UN Sustainable Development Solutions Network, we have calculated that additional donor funding of $200 million a year, matched by a similar rise in domestic funding, would enable the 77 IDA countries (“The World Bank’s Fund for the Poorest”) to successfully monitor their progress the SDGs – yes, even the proposed 17 goals and 169 targets!
We don’t yet know if that will turn out to be the final number of SDG “commandments”. But here’s something we do know – developed and developing countries are on the cusp of a huge and dramatic change in how they collect and disseminate. True, unlike Moses, we don’t live in a time of miracles. But with the aid of a clear road map, strong political will and “miraculous” technologies, we really are much closer to the promised land of better data than we realise.
Informing a Data Revolution – PARIS21
Watch the launch of A Road Map for a Country-led Data Revolution at the Cartagena Data Festival on Monday 20 April from 1700 hours UTC (noon in Cartagena, 1pm in New York, 6pm in London, 7pm in Paris, 2am in Tokyo).
Not much good has come from the Ebola crisis, save this: It has raised awareness of the fact that we already have a weapon in our hands that could help fight such epidemics – our mobile phones.
There’s already evidence to show that the idea can work. Following the earthquake and cholera outbreak in Haiti in 2010, for example, “call-data records” from mobile phones were used to track people’s movements, so allowing experts to “infer, with empirical data and in real-time, where people are, and how many, and where they are probably headed,” according to The Economist. That’s vital information in health crises, where epidemiologists need to know if people are moving into or out of highly infected areas.
The technique has been also been used to follow people’s movements in the wake of natural catastrophes, for example after the 2011 earthquake in Japan. And there’s growing interest in seeing how it could be used to track survivors of extreme weather events, such as Typhoon Haiyan in the Philippines, especially as climate change threatens to raise the frequency of such disasters.
But there’s a problem. Even if such tracking methods don’t involve eavesdropping on callers’ conversations, they do involve a breach of their privacy. And in the case of the Ebola outbreak, that seems to have been a major obstacle in preventing mobile operators from releasing their phone records.
There’s also the problem that for everyone involved – mobile operators, government regulators and researchers – this is still somewhat uncharted territory. There’s a general recognition that call-data records have potential to ease suffering during epidemics and after calamities but, as The Economist again notes, “the data are unlikely to be released without stronger leadership that brings together operators, regulators and researchers”.
Still, even if the Ebola crisis has highlighted what remains to be done, it’s impressive to see the ways in which mobiles are already being used to collect data in developing countries. Perhaps that shouldn’t be a surprise. After all, according to the International Telecommunications Union, mobile-phone penetration now approaches 90% in developing countries (and 69% in Africa). This doesn’t mean that nine out of ten people have handsets. But even setting aside all those people and businesses with second or third phones, it’s clear that unprecedented numbers of people now have a device in their pocket that’s not just a phone but also a powerful little computer.
That’s potentially important for developing countries, many of which lack the infrastructure and personnel to compile adequate statistics. As the World Bank’s Shanta Devarajan has noted, widely cited poverty data for Africa for 2005 relies on robust statistics from just 39 of the continent’s countries, with only 11 able to supply comparable data for the same year.
These data holes make it difficult to measure progress and to identify priorities for development. In response, there have been growing calls for a “data revolution”, which would require action on a range of fronts, including greater investment in government statistical offices in developing countries and making better use of “Big Data” and innovative technologies, like mobile phones.
Encouragingly, there are signs that some of this is already happening. For example, an SMS-based survey in Tunisia investigated remittances, an area where hard facts are notoriously scarce and where estimates of how money migrants are sending back home are just that – estimates. It found that more than a quarter of remittances are sent back by hand, more than the total sent via Western Union. Insights like that could help to provide more accurate data on what is an important source of income in many developing countries.
Mobile phones are also being used to “crowd source” data on price changes, which, as Gillian Jones reports, can be used to “compile near real-time consumer price inflation data”. Local residents take photos of price tags in shops and markets and send them to a central data store. There, they are analysed to provide data on price changes as well as scarcities. Field agents are paid a few cents for each photo they send, but that can add up to an income of as much as $25 a month. And how are they paid? Over their phones, of course.
Global Call for Innovations: The Partnership in Statistics for Development in the 21st Century (PARIS21) has launched a global call for innovations to highlight organizational approaches and new technologies to help realise the data revolution. It is seeking case studies in crowd sourcing; data management; monitoring and reporting; open data; real-time data; remote sensing; research standards; visualization; skills development; and technical infrastructure.
Clean water, cold vaccines, cell phones = a simple way to save lives (OECD Insights blog)
Today’s post is by Anne-Lise Prigent, the editor in charge of development publications at OECD Publishing.
It was a dirty word. Not something to boast about. Yet it was widely practiced, even by its harshest critics. Industrial policy is now back it seems – unless, as Stiglitz says, it never really left. The third edition of Perspectives on Global Development from the OECD Development Centre demystifies industrial policies. Does this edition live up to the outstanding standards set by the first two? Yes, and it should prove just as useful too.
As Cambridge professor Ha Joon Chang puts it: this “landmark publication… shows a supreme degree of pragmatism”. It “looks for ways to make industrial policy work better, rather than having an ideological debate on whether it exists and whether it can ever succeed. It is an excellent example of how that exploration may be conducted in an intelligent, well-informed and balanced way”.
That is not to say that this book paints a rosy, unrealistic picture of industrial policies. Countries have used industrial policies with more or less success and this report does not only look at successes, it also draws lessons from failures. Nimrod Zalk (Department of Trade and Industry, South Africa) will probably not be the only policy maker to consider that the book’s checklist of pitfalls is very useful. These range from indiscriminate subsidies and never-ending support, to short-termism, lack of monitoring and evaluation, preventing competition, and closed-door bureaucracy-led prioritization.
What are industrial policies really about? Their definition tends to be broad nowadays. It includes both innovation, infrastructure and skills policies as well as targeted interventions boosting a specific sector, activity or cluster. And it is not only about manufacturing, it’s also about high value added activities in agriculture and services (Beyond Industrial Policy).
In the context of developing economies, industrial policies imply “targeted government actions aimed at supporting production transformation that increases productivity, fosters the generation of backward and forward linkages, improves domestic capabilities and creates more and better jobs”.
Industrial policies are not necessarily easy to put in place. The risk of failure is high. But as Ha Joon Chang points out, the fact that something is difficult cannot be a reason not to recommend it. Countries, like individuals, learn by doing, so “without trying out ‘difficult’ policies, like industrial policies, capabilities cannot be improved”.
Why should developing countries turn to industrial policies now? Is it because of the crisis? In fact, countries like Brazil and Morocco started to design and implement industrial policies before 2007. There has been a deep, structural shift of the world’s economic centre of gravity towards Asia and the South which brings tremendous opportunities – and challenges – for developing countries. Today, the combined GDP of China and India amounts to one-third of that of the OECD area and it should outstrip it by 2060. Asian economies are increasingly integrated with China through supply chains. And China, India and Brazil have emerged as new partners for Africa. South-South trade and investment are on the rise.
The geography of production and innovation is changing. Like never before, new forms of FDI and the offshoring of high-value-added activities open up opportunities for learning, innovation and entering into new activities and sectors. At the same time, rising “middle classes” mean new consumer markets – by 2030, 80% of the world’s middle classes will be living in developing countries. And all this is happening in a context of intensified competition where innovation is essential.
Countries now try to diversify, enter new sectors or activities and thus upgrade domestic production. For example, Brazil, China, India and South Africa are using sectoral technology funds and public procurement to promote innovation. Brazil, Morocco and India are using FDI to foster innovation and industrial upgrading. They promote new forms of linkages between multinational companies (MNCs) and local firms to increase spillovers to the domestic economy.
21st century industrial policies will be agile, responding to change will be key. They will be iterative: countries need to be able to reorient actions when goals are not achieved. And interactive: industrial policies are about people and (territorial) inclusion. Dialogue with partners, the private sector and among peers will also be essential to share knowledge and make progress. For example, national development banks are regaining ground as key partners in strategy setting (Brazil) and in promoting greener development (e.g., special schemes to finance green technologies in South Africa).
Industrial policies require a high level of co-ordination and sequencing of actions in several fields such as skills, finance and infrastructure. Investing in more and better skills is not enough, skills mismatches should be reduced. Increasing access to finance for companies to invest in innovation and production development will be essential. This is especially true for SMEs that only received around 11% of total credit in Africa and the Middle East, less than 13% in Latin America and less than 20% in Southeast Asia, compared with nearly 25% in OECD countries. And infrastructure gaps can jeopardize the efforts of domestic companies to become more competitive. About 60% of the world’s infrastructure stock is located in high-income countries, 28% in middle-income countries and 12% in low-income countries.
Industrial policies are highly specific to country and time. Like a well-adjusted bow, they should match each country’s development level and aim at the right targets – neither too high nor too low in the value chain, building on comparative advantage without being a slave to it. China for example has a comparative advantage in manufacturing, yet one-third of the value added of its exports originates from services. Indeed, catching-up stories suggest that economic development comes with changes in specialisation and trade patterns and with growing innovation capabilities. Finland, Korea and China are cases in point.
Industrial policies help accumulate capacities and know-how. They are about making strategic choices to address long-term structural issues and setting the conditions for business to prosper. To take off, they require political leadership, well-functioning institutions and empowered regional governments. Not meddling governments, myopic bureaucracy and cramping markets. No, as Shakespeare said, “ambition should be made of sterner stuff”.
This post is from Serge Tomasi, Deputy Director of the OECD Development Co-operation Directorate
Over the past 20 years, the global development landscape has changed dramatically. At the same time, we face unprecedented global challenges and growing instability, with looming financial and economic crises, and growing unemployment, food insecurity, political instability and environmental threats.
In my view, the latter is probably the biggest of our challenges, as it is long term and will have a severe impact on developing countries for several reasons. Environmental degradation is already very costly in developing countries, where the share of national wealth that is embedded in natural assets is much higher than in developed economies. In these countries, already vulnerable groups of people, such as the rural poor, are highly dependant on natural resources. Without policy shifts to limit climate change and address other environmental risks, the pace of rising temperatures and growing water shortages will lead to alarming impacts concentrated in developing countries.
This includes food security problems in poor countries, where a dramatic increase in demand for food is expected by 2050 (by 50-70% in developing countries as a whole and by 100% in LICs). This combined with growing food price volatility could exacerbate already existing food security risks. Energy access and energy security are also pressing challenges for many countries, in particular in sub-Saharan Africa, where more than two-thirds of the population has no access to electricity today. Last but not least, demographic trends – such as rapid urbanisation – point to a need for dramatic increases in investment in new infrastructure. Without policy changes, infrastructure investments run the risk of being locked-in to outdated, polluting transportation and other systems, with large, negative impacts on human health and well-being in developing countries.
On the other hand, the success story of economic growth in a large set of developing countries – mainly in Asia and Latin America – is very impressive. We have learned from this experience that strong economic growth over the long term is critical is we want to dramatically reduce absolute poverty. But we have to learn also from the negative side of these experiences, including the challenges these emerging countries are now facing now with regard to environmental and sustainability.
Over the past few years, the OECD has been promoting a new growth model – a more sustainable and inclusive one. In 2011, an OECD ministerial meeting endorsed the OECD Green Growth Strategy, aiming to boost economic growth while preserving the natural assets on which our well being depends.
Today OECD has launched a new report – Putting Green Growth at the Heart of Development. It puts our expertise in green growth – and the experience of numerous developing countries – at the service of developing country policy makers who are committed to designing and implementing green growth strategies and policies. It recognises that economic growth is a key part of any national poverty reduction strategy, but also shows that environmental protection is a strategic asset in contributing to national wealth and the well-being of current and future generations. it poses the challenge of reconciling economic growth and environmental protection, and gives examples of how this can be effectively done. In short, it makes the case for promoting sustainable growth as a critical element of sustainable development.
As OECD Secretary General Angel Gurria said: “We are working to ensure that sustainable development and inclusive, green growth remain centre- stage in everything we do. We cannot afford to do otherwise.”
Putting Green Growth at the Heart of Development was prepared through intensive joint work with developing countries – mainly low-income countries – and with a wide group of development co-operation partners. It reviews nearly 80 policies and initiatives from 37 developing countries as well as regional green-growth initiatives.
The many examples described in the report present a clear and hopeful message: green growth can generate both wealth and well-being for citizens of current and future generations. The report also examines the trade-offs between short-term demands and longer-term impacts, and the need to make choices that will deliver a more stable and sustainable future while also ensuring immediate gains.
Beyond the national policy agenda, international cooperation can provide essential support to developing countries in managing a transition to green growth. Financing green infrastructure, strengthening access to international markets, boosting trade in green products and services, and promoting technological transfer and cooperation are key.
By some estimates, poverty has been reduced in recent years from 1.3 billion people in 2005 to fewer than 900 million in 2010. That’s about half a billion people in just five years – a truly impressive achievement. The talk is now of aiming for poverty eradication in the global development framework that will replace the Millennium Development Goals when they ‘expire’ in 2015. This, however, is likely to be a tricky challenge for at least two reasons. First, China and India can take credit for most of the recent reduction of poverty. As they largely achieved this without help from the international development community, it raises the question whether an international focus on direct poverty reduction will generate the greatest benefits. Creating an enabling environment centred on equitable investment, peace and security and sustainable development may be more productive – and contentious.
Second, estimates from experts like Andy Sumner and Homi Kharas suggest that a significant number of the remaining poor live and will live in fragile environments. This is problematic for effective poverty reduction because their governments have not necessarily demonstrated great commitment to this objective, while international aid to such countries is often not fit for purpose (consider the 2011 survey on monitoring the Paris Declaration on Aid Effectiveness, the 2011 monitoring report of the Fragile States Principles or the New Deal for Engagement).
Hence, a global, political push for poverty eradication through the post-2015 framework is likely to benefit from parallel bottom-up social innovation and mobilization. Modern technology can be a real game changer in this regard and two initiatives currently on-going in India and East-Africa have great potential.
India is setting up a biometrical system that will enable direct cash transfers to the country’s poorest. In one fell swoop this will eliminate layers of overhead and corruption by ensuring benefits reach intended recipients directly through a fairly foolproof system. Costs have been kept low by combining an open policy in selecting devices and software, and stimulating competition between private vendors.
Another example of modern technology at work is M-Pesa (mobile money in Swahili), the world’s most developed mobile-phone based money transfer and payment system. It uses national ID cards or passports as its basis to easily deposit, withdraw, and transfer money. It’s widely in used in Kenya and Tanzania in particular.
Now imagine linking a person’s identity – as established and stored in a biometrical database – with an internet-enabled, mobile-phone based platform that hosts (financial) services and information at global scale. Such a system would allow both accurate transfers at the level of individuals, including peer-to-peer, and authentication of beneficiaries. With internet-enabled mobile phone penetration rates rising fast everywhere, even remote corners of the world are reachable. This kind of technology can also be put in the service of development in fragile and conflict-affected countries, in at least two ways.
One application could be to use such mobile-phone enabled databases to share royalties resulting from natural resource extraction directly and more widely with local communities. A major problem with natural resource extraction in many fragile environments is that a significant part of the revenue that states receive gets stolen by those in power. Local communities don’t tend to see much of it, which results in a sense of injustice, marginalization, and occasionally, violence.
In fact, the Centre for Global Development is already exploring an Oil2Cash scheme that would see resource-rich governments make direct cash transfers to the accounts of individual citizens via modern technology. Apart from the merits and demerits of direct cash transfers, this scheme faces an important obstacle: why would governments that can currently spend this revenue at their discretion suddenly want to share it with their citizens? An alternative might be to make energy companies responsible for distributing part of the revenue directly to citizens that live in the relevant area. This probably requires creating a global norm – enforceable through national legislation – that ensures every exploration contract concluded in a fragile environment features a clause stipulating that energy companies will set up appropriate mechanisms to transfer a certain percentage of the revenues. The challenge here is of course how to make it stick globally and avoid creating competitive advantage for countries that do not sign up.
One option is to use the momentum of the new post-2015 development agenda to build on existing initiatives like the UN’s Global Compact and the Extractive Industries Transparency Initiative to create a global natural resource charter that, among other things, commits oil companies to share part of exploration revenues directly with local communities – corporate social responsibility in direct action. Another option is to follow in the tracks of regulatory efforts to improve due diligence of mineral supply chains, which faces similar collective action dilemma’s, build on its experiences and learn from its lessons (for OECD work click here).
A second application of modern technology to reduce fragility could lie in the area of disaster management. Several recent reports suggest that the frequency and intensity of natural disasters are increasing. While some of the largest, most deadly and most costly disasters have affected highly developed countries with the means to recover (such as Japan and the US), many affect populations living in fragile environments that are far less resilient to deal with their catastrophic consequences. The coastal zones that will absorb most of Africa’s population growth over the next decades are especially vulnerable.
It should be possible to register these populations in a biometrical system – akin to what India is piloting – so that when disaster strikes, global peer-to-peer transfers can be made directly to empower individuals to start rebuilding their own lives. In 2011 Kenyans already mobilized €171,000 in two days through M-Pesa contributions for the “Kenyans for Kenya” fundraiser set up to respond to famine and deaths from starvation in its Turkana District. Image what such a system might accomplish at a global scale by way of a ‘social protection floor’ in cases such as the Haiti earthquake or the recent droughts and famines in Ethiopia, Kenya and Somalia.
While such systems require significant one-off investments, do not solve more structural barriers to development, and still have to be made to work politically, they hold promise to move away from traditional rich-to-poor, Official Development Aid flows and can capitalize on a global world in which development is a rapidly changing notion and social empowerment on the rise.