1 MDG GOAL 8 Develop a Global Partnership For Development Maria Riley, OP Center of Concern July 2006.

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MDG GOAL 8

Develop a Global Partnership

For Development

Maria Riley, OP

Center of Concern

July 2006

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Strengths of the MDGs

Represent a global political consensus A political statement of values and

principles Concrete goals and targets Recognize poverty is multi-dimensional Linked to the Human Rights Framework Goals are good rallying points to engage

people in poverty issues

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Shortcomings of the MDGs

Top-down approachProcess of setting goals excluded key

players – Southern governments and civil society

View poverty primarily in economic terms

Targets tend to ignore the complex processes of development

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Shortcoming con’t.

Targets are selective and incompleteOver emphasis on external financingDistract attention from productive

sectors, particular rural developmentDistract attention from the macro-

economic constraints inhibiting countries’ ability to development

Targets overly ambitious

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Fundamental Question

Are the MDGs a numbers game or a call for structural and systemic change?

Goal 8 is the key to the realization of the other goals and points to the answer to this question.

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Key Goal 8 Issues and Structures Debt

Multilateral (World Bank, International Monetary Fund), Regional (Regional Development Banks), Bilateral Debt (Between Countries) and Commercial Debt (Banks)

Aid Bilateral Aid – Donor Countries

Trade Multilateral (WTO), Regional (NAFTA, etc), Bilateral

Agreements (FTAs between Countries)

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Debt – Current Situation

2005 G8 Meeting (Canada, France, Germany, Italy, Japan, Russia, UK, US)

Promised the Multilateral Debt Relief Initiative (MDRI) For countries that had completed the HIPC (Heavily

Indebted Poor Countries Initiative) Cancelled all debts owed to the IMF, the lending arm

(IDA) of the World Bank and the African Development Bank

Went into effect July 1, 2006

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MDRI and the MDGs

19 countries affected – 15 in Sub-Saharan Africa

Will save US$1.1 bn on debt service payments over the next 10 years – overall will say $US50bn over 40 years

HIPC countries need an estimated US$10bn a year now to meet MDG goals.

MDRI releases only 10% of that

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Loopholes in MDRI

Excludes many low income countries and all poor middle income countries

Excludes Asia and Inter-American Development Banks from MDRI

Does not include all debt Inconsistencies within initiativeAny debt service savings will reduce

future credits

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Aid – Current Situation

Conditions for effective aid Must be delivered in sufficient quantities Must be delivered on a predictable, low

transaction cost Requires “country ownership” – not tied

to conditionalities set by donors

Despite some progress, none of these conditions has been met

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MDG Aid Goals

Since 2001, aid has increased by 4% a year or US$12m

Very few countries are near or at the 0.7% of GDI goal

Too many countries do not fulfill their Aid commitments

Even if projected increases are delivered in full, there remains a huge shortfall for financing MDGs

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Trade – Current Assessment

WTO – Doha Development Round Stalled negotiations – lack development focus Critical areas

Agriculture – U.S. and EU subsidies NAMA (Non-agricultural market access) – tariff rates Services – diminishing flexibility

Aggressive demands by rich countries force developing countries to focus on damage control

Increased political co-operation and power among developing countries G 20+ G 33 (now 45)

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Trade con’t.

Growing critique of trade liberalization Rising poverty – globally and within countries Failure to deliver on its early promises

Full employment Reduction in poverty Environmental Sustainability

Small number of nations prospering Surprisingly little process in majority

U.S. and EU – strong move toward regional and bilateral trade agreements

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U.S. Participation in the MDGs

Debt Participated in G8 2005 debt cancellation Power player in the IFIs (WB/IMF) Continues to hold bilateral debts

Aid U.S, Japan and Italy give the lowest percentage

of GNI to Aid U.S. is the largest Aid donor in dollars Increased aid by US$8bn since 2000

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U.S/MDGs con’t

Aid Programs Traditional US AID and IFIs contribution Millennium Challenge Account (Millennium

Challenge Corporation) HIV/AIDs Relief

Trade Major negotiator for greater trade liberalization Excessive agricultural subsidies Aggressively seeking greater market access in

agriculture, NAMA and Services Strong limits on Special and Differential treatment for

developing countries

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Canada and the MDGs

Aid Increasing aid by 8% a year to double aid by 2010 Canada Fund for Africa – C$15million

Debt Canadian Debt Initiative and Paris Club

participation combined debt savings to approximately C$702m.

Participated in G8 MDRI

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Canada and MDGs con’t

Trade Greater access to Canadian Markets for

developing country exports Invested C$74 million in trade capacity

building for developing countries Strong advocate of trade liberalization

and a member of the QUAD at the WTO with the U.S., EU, and Japan

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Return to Fundamental Question

Are the MDGs a numbers game or a call for structural and systemic change?

More than a numbers game, but far from a call for structural and systemic change. This weakness sets the stage for the failure of the MDGs.

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Goal 8 – Target 12

Develop further an open, rule-based, predictable, nondiscriminatory trading and financial system (includes a commitment to good governance, development and poverty reduction both nationally and internationally.

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Global Economic Integration-Leading Edge of Globalization

Key elements

Trade

Foreign Direct Investment

Financial flows across borders, including debt

Driven by neo-liberal economic policy

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Neo Liberal Economic Policy

The Economic Doctrine defining current rules Laissez-Faire capitalism Called economic liberalism in U.S. policy Economistic worldview applied to Globalization Subordinates culture, geography, ecology,

social relations, human rights to economics Treats economic policies as neutral and value

free Favors the economically powerful

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Rests on economic fundamentalism and marketism – the law of supply and demand

Achieved by Privatization Liberalization De(re)regulation

Neo-Liberal Economics

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Privatization Transfer of public assets to private hands –

utilities, land rights, communication bands, etc.

Privatizing policy implementation (Public-Private Partnerships) humanitarian aid, education, policing, prisons, military

Privatizing Public Services – water, health, education, utilities

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Liberalization Reduce or eliminate barriers to

Trade (forms of protectionism) Foreign Exchange restrictions Direct and indirect investments restrictions

Maintain barriers to labor (immigration)

Inconsistencies and double standards abound, with powerful states ignoring the rules they impose on weaker states

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De(Re)regulation Deregulate so-called barriers to trade

Wage and price controls, subsidies, fixed exchange rates, taxes, fees on business, quotas and tariffs

Environmental controls Limit government power to regulate

Reregulate Laws and rules to promote efficient operations of

markets Shift from state regulation to market-enabling

governance

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History of Neo-liberal Policies

1980s: World Bank/IMF solutions to debt Stabilization and structural adjustment

programs (SAPs)(Washington Consensus) Reduce government Cut government spending – agriculture subsidies,

services Refocus production on exports Deregulate key financial sectors – banking,

investment

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History con’t

Effects Opened economies to trade, financial

liberalization and speculation Increased poverty and economic and

social dislocation Weakened the agricultural and rural

sectors Increased urban and outward migration Growing unemployment and

underemployment Growing debt, personal and national

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Trade versus Aid

In 2002U.S. Aid Lost Export

Earnings

Burkina Faso $10 million $13.7 million

Chad $5.7 million Nearly the same

Togo $4 million $7.4 million

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Where Are We Today?

Limited number of countries and peoples benefiting from global economic integration

Lack of a level playing fieldDemocracy deficit, concentration of

economic and political powerDriven by corporate and financial

interestDiminished role of government

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Today, con’t.

Ecological degradationLack of focus on social development

and human rightsGrowing global unemploymentCollapse of rural communities and

sustainable agricultureConcentration of wealth Increased poverty

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Another World is Possible

Critique of current model is increasing Most developing countries Some economists Social Movements

Alternative economic systems and structures Catholic Social Teaching Feminist economic agenda ILO Fair Globalization

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Catholic Social Teaching

(We speak rather of) a society that is not directed against the market but demands that the market be appropriately controlled by the forces of society and by the state so as to guarantee that the basic needs of the whole society are satisfied.

Centesimus Annus, #35.1

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Catholic Social Teaching

But there are many human needs that find no place in the market. It is a strict duty of justice and truth not to let fundamental human needs to remain unsatisfied and not to let all those burdened by such needs to perish.

Centesimus Annus, #34

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Catholic Social TeachingCertain objectives stated by Rerum

Novarum remain valid if a person’s work and very being are not to be reduced to the level of a mere commodity.

The objectives include a sufficient wage for the support of the family, social insurance for old age and unemployment and adequate protection for the conditions of employment. Centesimus Annus, #34.1

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Feminist Economic Agenda

Methodological starting points Social reproduction Human well being as a measure of

economic success Importance of human action Ethical judgments essential Race/ethnicity, economic class, cultural

diversities open different “standpoints” Environmental Sustainability

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ILO Fair Globalization A focus on people and their well-being Democratic and effective state Sustainable Development

Economic social development Environmental sustainability

Productive and equitable markets Fair rules Global Solidarity Deeper partnerships Effective global governance

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Another World is Possible

Global Community

Not

A Global Market