It would be nice to think that rich countries could help the poorest countries develop faster.
In the 1960s, they thought that an injection of capital would increase growth. Then in the 1980s they decided it wasn’t just investment, but the quality of economic policies that determined growth. That was where the Structural Adjustment Programmes came in. In the 1990s they decided it was not just economic policies but the institutions of the state more generally – such as property rights and the quality of the civil service – that determined how quickly the country would develop. And this decade, we have concluded that those institutions are themselves a consequence of more fundamental determinants such as conflict, natural resources, population, and the capacity of civil society. Policy-makers in aid agencies are scratching their heads thinking of ways to put these problems right.
This search for the ultimate causes of poverty is understandable and well-meaning. We keep hoping that if we can find the underlying reasons why some countries are still poor, we can use our money and expertise to remove those reasons and set the countries on the path to economic development.
In the meantime, twenty thousand people a day die of easily preventable causes. Mothers are condemned to watch their children die. Those children, if they survive beyond their fifth birthday, may not be able to go to school, because they are needed to work on the farm, or because the school is too far away or too expensive. In hard times, families may have to make do with one meal a day, or none at all.
If we can find a way to help countries to develop faster, we should. But in the meantime, there is a lot we can do to enable people to live better lives. We can pay for vaccines, or for the costs of school teachers. We can provide income to people to enable them to buy enough food to eat. Taking money from the rich and giving it to the poor is a worthy activity.
But as my new paper published by the Center for Global Development argues, the development community has been seduced by the rhetoric of transformation and sustainability. In every programme we design we have to argue that it will lead to economic growth, that it will be financially sustainable, and that we have an exit strategy.
A few years ago I was involved in ideas for making vaccines more available in developing countries. There was a lot of pressure from donors to show that reducing the number of people suffering from these diseases would lead to higher productivity and economic growth, so that the intervention would pay for itself in a few years. We had to explain how subsidies for vaccines would not be needed after a few years, because the price would fall or the developing country would be able to buy the vaccines itself. Nobody was prepared to say that we should pay for these vaccines now and for the forseeable future.
Sometimes these exit strategies can be damaging. Some donors have required governments to introduce user fees for health and education, to make these services financial sustainable – which denies access to the basic services for the very poorest. Maintenance of capital equipment like wells or roads is handed over to local communities or government, which are not equipped to maintain them. The result is that these aid programmes are not as effective as they could be. Worse, there are some aid programmes that make perfect sense which are never started, because nobody can see what the exit will be in the next decade.
None of us wants developing countries to be dependent on aid forever. If there is a way for us to accelerate development, we should do what we can to support it. But we should not allow poverty reduction to be defined in these narrow terms. There is much that we can and should do to support people in developing countries which will help them to live better lives while that development is taking place.