Tuesday, June 25, 2013

Poverty: Revisiting Essentials Underlying the MDGs

By Deepak Nayyar, South Centre* | IDN-InDepth NewsEssay

GENEVA (IDN) - The Millennium Development Goals (MDGs) began life a decade ago. There were three dimensions to the significance of the MDGs. It was an explicit recognition of the reality that a large proportion of people in the world were deprived and poor.

It was a statement of good intentions that sought a time-bound reduction in poverty to improve the living conditions of those deprived and excluded. It was an attempt to place this persistent problem, until then a largely national concern, on the development agenda for international cooperation. In retrospect, it is clear that the MDGs, much like the human development index, caught the popular imagination.

The reasons are almost obvious. There is a simplicity that is engaging. There are targets that are quantitative. There are objectives that are easy to comprehend. There are good intentions with which no one could possibly disagree. It could be said that the MDGs combined a normative statement on what is desirable and a political statement on what is feasible. But, as it turned out, the MDGs did not quite serve their larger strategic purpose of changing the discourse on development.


The limitations of MDGs as a construct, in conception and in design, provide some basis for an evaluation of the MDGs as a framework. In terms of conception, there are some basic problems. The MDGs specify an outcome but do not set out the process which would make it possible to realise the objectives. The MDGs are stipulated without any reference to initial conditions, but where a country gets to in any given time horizon depends at least, in part, on where it starts out from. The MDGs are set out in terms of aggregates or averages which often conceal as much as they reveal because there is no reference to distributional outcomes.

In terms of design, there are some serious limitations. There is a multiplicity of objectives, both quantitative and qualitative, that span a wide range. The objectives are specified in many different ways: in proportions, to completion or just intentions. Some indicators are inappropriate and could be misleading. An evaluation of MDGs as a framework for monitoring progress in development highlights shortcomings. There is an implicit, albeit incorrect, presumption that one-size-fits-all. There are unintended consequences, mostly in the form of misplaced emphasis on stepping up the rate of economic growth and mobilising external financing for social sectors.


What is more, it would seem that the MDGs have been misunderstood, misused and misappropriated. These problems are attributable, in large part, to the silence on means, with a focus on ends, which in turn might have been attributable to two reasons that are understandable: the recognition that development is characterised by specificities in time and in space, and the acceptance that there might be genuine differences of opinion on what are appropriate strategies of development so that a political consensus on means would be exceedingly difficult if not impossible.

But the silence was transformed into an opportunity by orthodoxy which simply occupied that vacant space. It had the voice and the influence to focus on faster growth, more aid and better governance. In the process, the essential values underlying the MDGs have been lost in translation.

Beyond 2015

In contemplating the future of MDGs beyond 2015, this paper suggests some important conclusions. Such a framework is necessary even if it is point of reference. But it cannot simply be more of the same. The MDGs should be modified but there is need for prudence in additions or subtractions, while ensuring that such rethinking is not stifled. Generalised MDGs and contextualised MDGs are complements rather than substitutes, so that global goals should allow space for differences in initial conditions and in national priorities.

Indeed, the time has come to reflect on contours of change which would represent departures from or substantial modifications in the existing framework. There are three imperatives that deserve to be highlighted.

First, there should be structural flexibility at the national level. It must be made explicit that MDGs represent objectives for the world as a whole, which are not a scale to measure progress in every country because national goals must be formulated using global norms as a point of reference.

Second, there should be a cognition of inequality in any assessment of outcomes. This is essential because inequalities exist and distributional outcomes matter. Hence the focus of any such exercise to monitor progress must be on the poorest 25 per cent or bottom 40 per cent of the population.

Third, the new framework for the MDGs must incorporate some priors on means rather than simply focus on ends. The message is not only about outcomes but also about process.

The recognition of poverty and deprivation with an emphasis on human development in the MDGs served a valuable purpose. But it was not enough because nothing was said about strategies to meet this challenge of development. The well-being of humankind is the essence of development, so that employment and livelihoods are essential, while distributional outcomes are just as important.

Redesigning strategies

In the national context, therefore, it is necessary to reformulate policies, redesign strategies and rethink development. In reformulating policies, there is a strong need to reflect on macroeconomic objectives and macroeconomic policies. In redesigning strategies, it is necessary to introduce correctives and interventions that prevent or minimise the exclusion of people from development. The object of correctives should be to foster inclusion.

In rethinking development, it is important to recognise the significance of institutions, the relevance of the balance between domestic and external factors and the critical importance of public action. It must be stressed that the developmental role of the state is critical across the entire spectrum of what needs to be done.

In the international context, the focus of MDGs is much too narrow. The misplaced emphasis on concessional development assistance, attributable to a donor-centric world view, dominates the discourse.

Clearly, the international community needs to do better at this unfinished business but far more needs to be done. Moreover, aid is a mixed blessing. There are other sources of external financing such as remittances from migrants that need to be explored. In any case, for developing countries, access to markets in trade and access to technology for development are far more important than foreign aid could ever be.

Similarly, there is need to transform thinking on LDCs which seems to stress economic growth assuming that it will trickle down and investment in social sectors assuming that it would reach the poor. The approach to poverty reduction needs to be re-oriented away from compartmentalisation in social sectors into an integration with development strategies that seek to combine economic growth with employment creation and participatory development.

Most important, perhaps, it must be recognised that unfair rules of the game in the contemporary world economy encroach upon policy space so essential for development. This situation needs to be corrected. Even rules that are fair are necessary but not sufficient.

And there is a need for positive discrimination if not affirmative action in favour of poor countries, particularly the LDCs that are latecomers to development. The possibilities of cooperation among developing countries at this juncture provides a new window of opportunity, through better bargaining and collective action, for reshaping some existing rules or creating new rules that are at least less unequal if not fair.

*Deepak Nayyar is the Vice-Chair of the Board of the South Centre. This article is an extract from the South Centre's Research Paper No. 38, on The MDGs Beyond 2015. It is being reproduced by arrangement with the South Centre. The full paper is available at www.southcentre.org. Visit SouthViews for other articles, please click here. For more information, please contact Vicente Paolo Yu of the South Centre: yu@southcentre.org [IDN-InDepthNews – June 22, 2013]

2013 IDN-InDepthNews | Analysis That Matters

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