Presentation by Antonio Tujan, Ibon (The Phillipnes), at the IGNIS-Confernce "Whose Governance? Obstacles to the MDGs" at Mastemyr (Oslo) 20-21 September 2004
(for ytterligere informasjon, se FNs tusenårsmål - en historie om fusk og svik, RORG-Samarbeidet 24.09.04)

We, heads of State and Government, have gathered at United Nations Headquarters in New York from 6 to 8 September 2000, at the dawn of the new millennium, to reaffirm our faith in the Organization and its Charter as indispensable foundations of a more peaceful, prosperous and just world…[1]

Thus did the United Nations open its Millennium Declaration whereby its members committed to the achievement of the Millennium Development Goals by 2015. These Goals not only serve to embody hope for humankind’s future free from poverty and misery, they also define the responsibilities of all development actors – official donors, multilateral institutions, national governments, civil society organizations and the private sector – directly involved in the goal to end global poverty. [2]

The tasks and imperatives for development and ending poverty are urgent. One third of all human deaths – some 18 million people a year or 50,000 daily – are due to poverty related causes (such as starvation, diarrhea, pneumonia, tuberculosis, measles, malaria, perinatal and maternal conditions), which could be prevented or cured easily. This death toll since the end of the Cold War in 1990 is about 270 million, a majority women and children, roughly the population of the United States.[3]

The UNDP’s 2003 Human Development Report has demonstrated that the era of globalization has accompanied such levels of poverty with a widening inequality gap where the richest 5% of the world’s people receive 114 times the income of the poorest 5%.[4] Nearly half the world’s population lives on less than $2 a day and command a mere 1 and 1/4% of the world’s global social product, while a third as many people in rich countries command 64 times the income and 81% of the global social product.[5]

Realizing the goals, however, is another story. Achieving unity of commitment among official development actors to these goals have been achieved to some degree through the Millennium Declaration. Creating the political will necessary to implement poverty reduction programs steadfastly and seriously as well as commit billions of dollars in development aid which are essential to mobilize resources to achieve poverty reduction through the MDG process still face tremendous challenges.

Furthermore, there remain serious differences in the apprehension of the problem of poverty, the analysis and understanding of the causes and conditions of poverty, and strategies for poverty eradication. These differences affect the evaluation of the implementation of MDGs and evaluation of achievements, as well as defining priorities for action.

Competing paradigmatical frameworks for the MDGs

The MDGs were originally proposed and agreed in 1996 by the developed country ministers at the Development Assistance Committee of the OECD. No one represented the developing countries where the development goals were meant to be achieved and whose governments were primarily responsible for achieving these goals and formulating and implementing development strategies in their respective countries.

Thus many civil society organizations were highly critical of the process and content of the MDGs which avoided commitments to, and drew attention away from, the critical structural issues for global economic justice. Among these were issues of debt cancellation, fair trade, equitable participation in global institutions that had been raised repeatedly in the 1990s global UN conferences by both developing country governments and many participating civil society organizations.[6]

While avoiding structural issues at the root of poverty, the MDGs are also tremendously modest goals. For example, the first goal to reduce the proportion of people living on less than $1 a day by 2015, if it is achieved, will still leave an estimated 937 million people living in absolute poverty in 2015, a mere reduction of about 230 million or less than 20% in the numbers of people living in poverty between 2000 and 2015.[7]

This early, several commentators are warning that these modest goals may not be achieved at all. Many developing countries have insufficient resources to provide the necessary infrastructure and services to achieve these goals. The UNDP and World Bank estimate that an additional $40 to $60 billion is needed to provide such resources to needy countries. If OECD donor countries fulfilled their development assistance target of 0.7% of gross national income, then $195 billion would be added to the $58 billion total aid in 2002, which is only 0.23% weighted average of donor countries.[8] However, only an additional $18 B were pledged by donor countries at the Monterrey Financing for Development conference of the United Nations.[9]

In recognition of the fundamental value of shared responsibility cited by the Millennium Declaration,[10] Goal 8 of the MDGs seeks to develop global partnership for development. This goal includes targets for the comprehensive approach to the debt problem of developing countries to end debt crises, increasing development assistance for poverty reduction, as well as addressing special needs of least developed countries and of landlocked states.

This goal has particular importance as a platform for advocacy for many civil society organizations pushing for the increase of development assistance to at least 0.7% of gross national income. Goal 8 also provides room for pushing for debt cancellation and reform measures both national and multilateral to end the debt crisis worldwide.

However, the same goal remains hobbled by the post-Washington consensus prescriptions that perpetuates the neoliberal framework championed by the World Bank and the International Monetary Fund. Thus, while the Millennium Declaration resolves “…to create an environment – at the national and global levels alike – which is conducive to development and to the elimination of poverty,” it immediately follows this resolution with the statement that success to this resolution depends on good governance and transparency within each country and at the international level. And that “We are committed to an open, equitable, rule-based, predictable and non-discriminatory multilateral trading and financial system.”[11]

Typical of World Bank post-Washington consensus prescriptions, these goals and commitments combine the neoliberal goals with the agenda of good governance and transparency. The call for an “open, non-discriminatory multilateral trading and financial system” as realized through the World Trade Organization and the International Monetary Fund have meant the imposition of free-market rules on developing countries and forcibly dismantling mechanisms to support local capital and marginal economic sectors and consumers. These mechanisms are considered protectionist and discriminatory against foreign monopoly multinationals.

The Post-Washington Consensus is an overwhelming agenda for institutional reform that is premised on optimism about the relevance of northern models of governance and pessimism about local southern governance capacities and structures.[12] It is a model that many would argue is ill suited to the real conditions of governance facing the poorest countries to which it is directed. These countries are being overwhelmed not only by deep institutional reforms imposed by the IFIs, but also by a host of rules and regulations arising from their compliance with the Uruguay Round GATT trade agreements.

The strategy of poverty reduction through economic growth promoted by the World Bank is hastened through neoliberal reforms. Thus, in a report issued by the IMF and the World Bank in April 16, the World Banks states that achievement of the MDGs would mean “accelerating reforms to achieve stronger economic growth – Africa will need to double its growth rate.” This report states further the sub-Saharan countries are “seriously off track, with just eight countries representing about 15 percent of the regional population likely to achieve the goal.”[13]

Such pessimism, however, is not meant to encourage more development assistance to developing countries, but on the contrary is based on aid pessimism and prescription for Washington consensus reforms as the means to achieve rapid economic growth, and consequently, poverty reduction. A survey of IMF programmes in 20 countries by Oxfam and Eurodad shows that for the IMF financial inflexibility and aid pessimism are still the norm. The negative impact of this inflexibility and conservatism is compounded by the continued role of the IMF as gatekeeper for donor aid and debt relief.[14]

Human rights and governance

The Millennium Declaration, in upholding the fundamental value of freedom first among others, states, “Men and women have the right to live their lives and raise their children in dignity, free from hunger and from the fear of violence, oppression or injustice. Democratic and participatory governance based on the will of the people best assures these rights.”[15] Indeed, the Millennium Development Goals can only be realized by upholding human rights and assuring the people’s participation.

Despite coordinated campaigns by the UNDP and some civil society organizations, ordinary citizens have little sense of ownership of the MDGs, or of their role in holding their governments accountable for national strategies to tackle social dimensions of poverty based on the MDGs.[16] Indeed, the goals themselves are silent on basic issues of citizens’ rights, empowerment and improved equality, and thus ignore the politics inherent in working for their achievement in many countries. Even the World Bank recognizes, at least intellectually, these conditions – empowerment and equality – as essential social qualities for overcoming poverty.[17]

Ending poverty is inherently a political process specific to local economic, social, cultural, ecological and gender equality circumstances in each country. As the work of Amartya Sen demonstrates, people-centred development for poverty eradication is ultimately about recognizing the rights of the vulnerable, and transforming the power relations, and cultural and social interests that sustain inequality. Development is therefore a political process that engages people, particularly the poor and the powerless, in negotiating with each other, with their governments, and with the world community for policies and rights that advance their livelihood and secure their future in their world.[18]

The poor are not the subjects to be acted upon by development action, but rather are central actors in sometimes conflictual politics seeking pro-poor development strategies. Consequently, finding avenues to address unequal power, capacity, and access to resources for the poor and the marginalized is a fundamental challenge to development actors wanting to link poverty reduction to democratic governance and participation. The UN system, the Charter, and its various Declarations and Covenants on Human Rights provides a normative framework within which these issues can be addressed.

While based on international legal codes and covenants developed over the past century, the rights framework is a dynamic one that continues to evolve through intense national and multilateral political processes. It has been the result of many decades of struggles by peoples’ organizations – women’s movement, indigenous nations, gay and lesbian networks, workers and labour organizations, fishers and farmers organizations, human rights defenders. Human rights are essentially active and should not merely be ‘promoted’ or ‘protected’, but are to be practiced and experienced. They have implications for the actions of all donors, governments, and non-state actors in development.

In the words of John Foster, “participation is central to a human rights approach to development as a right, an entitlement guaranteed by international law, rather than an optional extra or tool for the delivery of aid”. Nevertheless the challenge for development practitioners, civil society and official aid agencies alike, is to make the language and analysis of rights accessible to citizens and organizations working to overcome the conditions of poverty from community to national levels.[19]

The MDGs are minimal, but very useful targets, which can serve as a political framework for leveraging political commitment to poverty-focused development, but must not undermine existing broader obligations on the part of governments to international human rights law. The MDGs can only be achieved within a rights framework whereby citizens and governments are engaged in restructuring global and national power relations in order to transform the root causes of poverty. Hence democratic governance and citizens’ rights, at all levels, with full local ownership of development initiatives, are fundamental.

Democratic or good governance?

The Millennium Declaration invokes both ‘democratic and participatory governance’ and ‘good governance’ as essential. The first one as a fundamental value and the second one as essential to the realization of the development goals. But the World Bank and bilateral donors have a different focus in their insistence on good governance. In 1989 the World Bank explicitly identified “a crisis of governance” behind the “litany of Africa’s development problems”: it defined governance as the “exercise of political power to manage a nation’s affairs”.[20] Since then the policies and interventions to promote “good governance” have become a central preoccupation in the official donor community.

But donors often have strong self- and pre-conceived notions of what constitutes “good” governance, undermining local traditions and democratic processes. But perhaps more serious, is the way that some donors seem to be using good governance like a can-opener, to prise open markets and dismantle national regulatory frameworks. When the result of changes to promote ‘good’ governance is poor people having to pay for privatized water, international companies extracting new profit streams from fragile southern economies and the most vulnerable people having to bear the risks of unemployment in a capricious global market, the relationship between governance policies and poverty reduction has to be questioned.

In general, “good governance” for donors has some if not all of the following effective dimensions – public accountability and transparency, the rule of law, anti-corruption measures, decentralization and local government reform, democratic performance, juridical reform, social safety nets, a regulatory but lean state apparatus for efficient private markets, civil society participation in development and overall respect for human rights. In practice, however, donors have focused on governance largely through a much more restricted lens of “good governance” in the technical management of government resources and effective implementation of (often donor directed) macro-economic and anti-poverty sector policies.[21]

The UN Financing for Development conference brought reinvigorated attention to governance/democratic deficits in the international economic, financial and trading system.[22] The Monterrey Consensus calls explicitly for “broadening and strengthening of participation of developing countries with economies in transition in international economic decision-making and norm-setting”, and in particular invites the World Bank and the IMF to respond to these concerns (para 56 and 57). These institutions have been at the forefront of major systemic crises in developing countries (for example, Argentina, Indonesia, Ghana among many others) with devastating social and economic consequences for citizens in these countries, particularly the poor and vulnerable. After 30 years, they have largely failed to deliver promised opportunities for poverty reduction from structural adjustment policy and loan conditionalities based on the primacy of deregulated market-led growth. Instead, globalization has undermined the policy alternatives and the capacity for effective governance for many of the poorest countries.

Governance is not an end in itself, to be engineered through technical assistance and policy interventions by donors. Rather it is fundamentally about politics, power and the exercise of rights in society, and is therefore an evolving and particular process that may take decades. In its 2002 Human Development Report, the UNDP defines governance as a culturally and country-specific democratic means, both process and institutions, for the exercise of peoples’ rights, which ensure equity, promote social solidarity and sustainable livelihoods. Unlike the technocratic approach of the World Bank and many donors, focusing on administrative efficiency, processes of governance within a rights framework takes account of unequal power relations within society and globally, including gender relations.

For the UNDP advancing democratic governance has several implications:

¨ The links between democracy and equity are essential for human development, which is not automatic when a small elite dominates economic and political decisions;

¨ Democracy that empowers people must be built – it cannot be imported – and will take many forms in a given context;

¨ Establishing democratic control over security forces is an essential priority – otherwise, far from ensuring personal security and peace, security forces may actively undermine them; and

¨ Global interdependence also calls for more participation and accountability in global decision-making.[23]

The fostering of a different model of global governance is of critical importance because the current model, designed for the post-war 1945 world, is no longer relevant nor sustainable for the 21^st century. A strengthened co-ordinating and agenda setting role for the United Nations is at the very core of a democratic vision for the management of urgent global social, environmental and economic issues. But some major developed countries, with their controlling shares in decision-making at the Bank and the IMF, are reluctant to see more democratic processes determining these issues.

The consolidation by the United States of a uni-polar world order, dangerously based on economic and military might, with few checks and balances, has instead weakened multilateral institutions and values. . These multilateral institutions, with a potential for building global democratic consensus on priority global public goods issues, such as fair trade or combating curable disease, are being sidelined by the United States and several other developed countries, when they do not serve the US administration’s immediate and expressed strategic interests

At the same time, key international financial institutions (IFIs), including the WTO, while a part of the multilateral system, are largely controlled by these same powerful countries. IFIs have a long history of structuring policy choices for developing countries. In doing so, as we have seen above, these institutions have been widely challenged for their lack of democracy and their rigid defence and promotion of the interests of industrial countries in the management of global crises and the expansion of global economic opportunities, often in the interests of unaccountable global corporations.

There is little doubt that the IFIs, the Basel Committee (of the 10 most powerful Central Bankers) and the WTO, along with regional development banks, are the central pillars in global economic governance. The IFIs are also the apex institutions in the international aid regime, with an almost unquestioned role to define for all donors the legitimate terms of policy discourse with developing countries and effective strategies for the delivery of aid in relation to poverty reduction.

The Reality of Aid 2004 Report on Governance and Human Rights proposes the following reforms:

1. The International Financial Institutions must no longer be the exclusive intellectual and authoritative “gatekeeper” for policy advice on governance reform and resource transfers in the aid regime. These institutions must take on board the substantial critique of their past and current practices, which exposes the fallacies and undermine their credibility as source for definitive development discourse and practice for the donor community.

Northern donors have become both the judge and the jury of “good” governance in high aid-dependent poor countries, with all donors closely integrating into their own aid policies a Bank-defined “post Washington Consensus”. As noted earlier, this Consensus links Bank-inspired macro-economic policies for growth with institutional reform to assure political “ownership” and governance capacity in the poorest countries to implement these policies. The donors have adopted this Post-Washington Consensus with the explicit working assumption, rooted intellectually in the Bank, that, in the whole, the development agenda is indisputably known and only the details need attention.[24] By gaining a near monopoly on official donor development analysis and the extension of its assumptions to the donor community as a whole, the Bank is able to validate its ideology and essentially discount the emergence of alternatives outside its paradigm.[25]

2. In establishing new and equitable partnerships with developing countries, the International Financial Institutions must abandon the practice of externally imposed policy conditionalities and policy undertakings, enforced through their roles in negotiation of multilateral aid loans and in their facilitation of donor coordination in the international aid regime. World Bank-led dialogue with developing countries should adopt a rights-based approach.

The Reality of Aid 2002 Report, with its focus on conditionality and ownership, suggested that donors and developing country partners need to negotiate resource transfer within a framework of reciprocal obligations based on shared values and a commitment to direct these resources to benefit those who are socially and economically excluded.

The World Bank itself is quite categorical about the perverse effects of conditionality. Paul Collier, Director of Research in the World Bank, has written: “The extension of the practice of conditionality from occasional circumstances of crisis management to the continuous process of general economic policy-making has implied a transfer of sovereignty which is not only unprecedented but is often dysfunctional”. A great deal of research has demonstrated that governance is in fact a product of complex and inevitable political processes in which different groups in society compete and benefit differently from alternative governance agendas.

Externally-imposed conditionality, by focusing broad-based policy dialogue in often secret negotiations between select government officials and those from the Bank and the Fund, clearly undermines democratic accountability by removing significant policy options from public processes for citizen and parliamentary oversight. A rights approach puts people, particularly those living in poverty, the vulnerable and the marginalized, at the centre of local and national political processes. A rights-based approach should be adopted as an alternative to policy conditionalities wherein donors would work to assist developing countries to move towards the realization of their UN treaty obligations and international human rights law. The framework for such dialogue with donors is the mutual obligations and requirements, arising from these treaties and covenants, for all countries to progressively realize economic, social and cultural rights of their citizens.

3. The decision making processes at the World Bank, the International Monetary Fund and the WTO must be reformed and democratized and brought within a new framework led by the United Nations, with limited mandates subject to the United Nations legally binding international human rights framework and the social values embodied in the Millennium Development Goals.

While it can be said that the International Monetary Fund and World Bank both threaten to run away with the MDG process and turn it into an pretty post-Washington consensus wrapper, these proposed reforms would place the IFIs in the genuine framework of the Millennium Declaration for achieving peace, development and progress, and ending poverty.

Achieving radical or even substantial reform in governance of the IFIs and the WTO as well as the United Nations system in an increasing unstable post-Cold War world is not easy to say the least. These multilateral institutions have become instruments of the power of the G8 in a unipolar context. Changing the governance of these institutions would require, in my view, a shift in the balance of global power. For a start this would require an escalation of global public opinion and empowerment mainly for the global South, especially on the side of developing countries and their peoples who have the most at stake in removing injustice, inequality and unfair relations. From such global groundswell the argument for substantial reform of the multilateral system will then find sympathy from those who stand to lose more if such groundswell is not mitigated. ***

Antonio Tujan Jr. is Chairperson of the International Management Committee of the Reality of Aid Network and Convenor for Asia of the International Initiative on Corruption and Governance. This paper draws substantially in some parts from the Political Overview of the Reality of Aid 2004 Report.

[1] Resolution adopted by the General Assembly 55/2 United Nations Millennium Declaration [A/55/L.2].
[2] “The Reality of Aid 2004 Report, Focus on Governance and Human Rights in International Cooperation”, IBON Books, 2004.
[3] Thomas Pogge, “The First Millennium Development Goal”, first Oslo Lecture in Moral Philosophy at the University of Oslo, September 11, 2003, www.etikk.no/globaljustice/.
[4] UNDP, Human Development Report 2003, New York: Oxford University Press, 2003, 38-39. The 25 million richest Americans have as much income as almost 2 billion of the world’s poorest people.
[5] World Bank, World Development Report, New York: Oxford University Press, 2003, 235 (quoted in Pogge, 2003, 11)
[6] Reality of Aid, Op. cit.
[7] Pogge, 2003, p. 3
[8] Reality of Aid, Op. cit.
[9] Oxfam Briefing Paper 54, “The IMF and Millennium Development Goals, Failing to deliver for low income countries”, September 2003.
[10] Resolution adopted by the General Assembly 55/2 United Nations Millennium Declaration [A/55/L.2]: “Shared responsibility. Responsibility for managing worldwide economic and social development, as well as threats to international peace and security, must be shread among the nations of the world and should be exercised multilaterally. As the most universal and most representative organization in the world, the United Nationals must play the central role.”
[11] Ibid.
[12] Reality of Aid, Op cit..
[13] Mason, Barry, “World Bank chief admits United Nations Development goals cannot be met”, 18 May 2004

[14] Oxfam, Op. cit.
[15] UN Resolution, Op. cit.
[16] See for example, Kumi Naidoo, “Civil Society, Governance and Globalization”, World Bank Presidential Fellows Lecture, Washington DC, February 2003, pp. 7-8, accessed from the World Bank web site, www.worldbank.org.
[17] Simon Maxwell, Heaven or Hubris: Reflections on the ‘New Poverty Ageda’”, Development Policy Review, 2003, 21 (1), p. 13-14.
[18] Reality of Aid 2004 Report, Op.cit.
[19] John Foster (North South Institute, Canada), “Crisis time: Repossessing Democratic Space, Governance and the Promotion of Rights in International Cooperation and Aid, A Discussion Paper for The Reality of Aid”, April 2003, accessed from the Reality of Aid website, www.realityofaid.org., p. 8.
[20] World Bank, Sub-Saharan Africa: From Crisis to Sustainable Growth, Oxford: Oxford University Press, 1989, 60.
[21] See background paper prepared for the Reality of Aid International Advisory Council by Kavaljit Singh (Public Interest Research Group (India), “Aid and Good Governance: A Discussion Paper for Reality of Aid”, January 2003, accessible at www.realityofaid.org.
[22] For a review of the FfD process in relation to global governance, see Aduba, G., Caliari, A., Foster, J., Hanfstaengl, E., Schroeder, F., “A Political Agenda for the Reform of Global Governance”, October 2003, prepared as a background paper for the UN Financing for Development High Level Dialogue, October 29-30, 2003, by members of the civil society International Facilitating Group, accessed on the UN Financial for Development web site at http://www.un.org/esa/ffd/14April03-NGO-Statement-Plenary.pdf.
[23] UNDP, Human Development Report 2002, Deepening democracy in a fragmented world, New York: Oxford University Press, 2002, “Overview”, 1 – 9.
[24] Alex Wilks, Fabien Lefrancois, “Blinding with Science or Encouraging Debate? How World Bank Analysis Determined PRSP Policies”, Bretton Woods Project, World Vision, 2002, available on www.brettonwoodsproject.org.
[25] Concern (Ireland) [no author], “Is the PRSP Consolidating the World Bank’s Dominant Position in the Development Process?” [no date] (approximately 2002), 2.