The UN's poverty of ideas

It is not inevitable that poor nations must always be so, but they will not find help at Copenhagen Given rapid growth and declining inequality, East Asian countries are unusually successful
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The Independent Online
This week in Copenhagen, the United Nations is staging its largest ever event, the World Summit for Social Development. This international meeting to combat poverty is bigger than the summits on the environment in Rio in 1992, on human rights in Vienna in 1993, and on population in Cairo last year. Quite aside from the 184 countries that are represented in Denmark, 10,000 observers from nearly 3,000 non-governmental organisations are holding parallel meetings. The cost is being put at £20m, but if one adds in the additional cost of transport, NGO participation, press coverage and the like the cost will be vastly higher. It will do wonders for such poverty as exists in the hotels and restaurants of Copenhagen.

Whether the summit does anything for poverty in the rest of the world is the source of hot debate. It has been strongly criticised by several NGOs; and Save the Children, one of the most honourable and effective in its work to eliminate poverty among children, has boycotted the entire event.

The aim of the summit's promoters was honourable and admirable: to find some way of diverting part of the "peace dividend" accruing from the end of the Cold War towards helping the very poor. But even this simple aim carries a questionable assumption: is spending yet more taxpayers' money in "aid" the most effective way of helping the very poor? When one looks at the detail of the summit proposals the atmosphere of unreality becomes even more evident.

Listen to the language. The agenda, as set out in the UN's Human Development Report 1994, called for a "new global human security fund" financed by some form of world taxation, perhaps on capital movements or on energy consumption. It would be administered by the UN, where it would be "essential to set up an Economic Security Council. This would be a decision-making forum at the highest level to review the threats to global security ..." The body would have to have "a professional secretariat - small and highly qualified, led by an outstanding person ... The regular meetings would involve nationals with economic and financial expertise ... but there would also be occasional high-level meetings of ministers of finance and planning, as well as annual sessions at the level of head of state or government."

That self-same report ranked the countries in the world by "human development," an indicator that includes things such as life expectancy, adult literacy, access to safe water and so on. I happened last month to spend a week's holiday in the country second from the bottom of the UN's list: Burkina Faso, formerly Upper Volta, in West Africa. There I saw some of the heroic efforts being made by very poor villagers to bring education to their children. They were being helped by Western organisations, including Save the Children, but were building the schools themselves and paying some fees. It was a humbling experience, and it is difficult not to feel that this is a more effective way of fighting poverty than financing "high- level meetings of ministers" in places like Copenhagen.

But if the UN summit has a purpose it is to challenge the view that the poor (including the poor in the developed world) will always be with us - that nothing can be done. Not only has a lot been done in the past 30 years - in 1960, 70 per cent of the world suffered from extremely poor human conditions, while by 1992 that proportion had fallen to 32 per cent - but we know a lot about the reasons for economic progress.

The region in the world that has made most progress (in human as well as purely economic terms) in the past 30 years is East Asia. Perhaps the best analysis of the reasons for the region's success was produced in 1993 by the World Bank. The East Asian Miracle looked at how eight economies in the crescent from Japan down to Indonesia had shot ahead. The key point in this report is that the essence of the miracle is the combination of rapid growth with equity: that while some of the governments were pretty authoritarian they established their legitimacy by putting in place policies that made sure that additional wealth was shared by all.

Growth was driven by creating a business-friendly environment, by building human capital through education, by increasing savings and investment, and by allocating investment to industrial sectors that were likely to produce rapid growth in exports.

As the World Bank points out, given rapid economic growth and declining inequality, these countries have been unusually successful in reducing poverty. It compares the performance of four of them, Indonesia, Malaysia, Singapore and Thailand, with a mixture of other developing countries from Latin America, the Indian sub-continent and Africa. The East Asians' performance, both inreducing the proportion of people below the poverty line and cutting the absolute number of the poor, is almost invariably much better. Increases in life expectancy have also been better than for any other region.

This experience surely leads to two conclusions. The first is that it is clearly quite possible to make dramatic progress in cutting poverty: the UN conference is not talking about some impossible goal. The second is that the path towards cutting poverty is well-charted by the experience of East Asia: we know what works. The trouble is that what works does not involve the UN bureaucracy.

So if one were setting out an agenda to attack the problem of poverty, it would not start by creating yet another layer of bureaucracy, or calling for a new world tax - which is not going to happen. Instead it would examine and seek to emulate the "best practice" examples of countries that have managed to make the most rapid progress in cutting poverty. It would be a bottom-up approach, not a top-down one.

There might be a role for some international body in helping to share the information, and helping countries to put into place policies which have worked successfully elsewhere. But that role is at best limited, and might even be counter-productive. Look at the way the World Bank has become a hate figure in parts of the developing world, where well-meaning efforts to influence policies have had the effect of undermining domestic politicians committed to carrying out those policies.

Grand UN summits may well have their uses. Rio and Cairo, in their different ways, focused attention on two aspects of the problem of pressure on world resources. Copenhagen may focus attention on poverty: the trouble is, it is the wrong sort of attention. More developing countries should take the line of Bakili Mulizi, the president of Malawi (14th from bottom of the UN poverty league). He explained this week that he was not going to Copenhagen, but was, instead, going to spend the £200,000 it would cost on alleviating poverty in his own country.