Rebeca Grynspan: "Towards Sustainable Development and Growth"

09 Apr 2010

Remarks by Rebeca Grynspan, Associate Administrator of the United Nations Development Programme

At the 16th Annual International Development Conference at Harvard University
“Towards Sustainable Development and Growth: Addressing Today’s Challenges”

Friday, 9 April 2010

I am very pleased to join you this evening on the occasion of the 16th Annual International Development Conference hosted by the John F. Kennedy School of Government here at Harvard University.

This is my first time to Cambridge since I became the Associate Administrator of UNDP.

It is always a privilege to return to seats of academia such as this, and it is especially gratifying to know that this event is organized by graduate students interested in international and sustainable development.

Meeting development goals in today’s world requires a clear understanding where obstacles to these goals lie, and how they can best be bypassed. The debates contributing to this understanding should not be limited only to the halls of power or the corridors of bilateral and multilateral organizations.

It is important that the voices of students, researchers, and academics are heard loudly as well, so I am pleased to see so many of you here this evening.

The UN’s development work does not always get as much publicity as the political and security side of the UN. But it is certainly no less important, it is certainly pressing, and it certainly needs extra support and attention.

In recent years the world has been facing major food and fuel crises, followed by an economic crisis, with resulting lingering effects that we are still dealing with. On top of this, there is also the climate change challenge that we know affect in a differentiated manner different parts of the globe, but making a general point about developing countries is that we know that the effects of natural disasters put already vulnerable countries on a lower path of growth and in a cycle of higher vulnerability and poverty.  The lack of resources to adapt and build back better together with the disruption of livelihoods is at the heart of this result. From the 2007/2008 HDR on climate change: “Looking to the future, total committed financing for adaptation through dedicated multilateral funds amounts to a total of US$279 million. These funds will be disbursed over several years. Contrasts with the adaptation effort in rich countries are striking. The German state of Baden-Würtemberg is planning to spend more than twice as much as the entire multilateral adaptation effort on strengthening flood defenses. Meanwhile, the Venice Mose plan, which aims to protect the city against rising sea levels, will spend US$3.8 billion over five years

So, natural catastrophes, like the devastating earthquake in Haiti, add to the list of problems, as do ongoing conflicts in many parts of the world, and the challenges associated with poor governance, inequality, armed violence, and citizen security.
In tackling these crises, I am convinced that what is needed is more than ad hoc responses. Too often the world waits until a crisis happens to become infused with sense of urgency about addressing a particular issue, often at much greater cost than if there had been timely support.

The message to me is clear: to promote pro-poor, inclusive growth and sustainable development, we need to help developing countries build greater resilience to whichever problems they are likely to face, while decreasing the likelihood for shocks to occur in the first place.

The many challenges to development also present just some of the reasons why the world needs to enhance international cooperation and a strengthened multilateral system which reflects the realities of the 21st century.

That system need the strong support of political leaders world-wide, and must be based on global governance structures which promote inclusive, legitimate, and effective agreements.

The UN needs reform – such as to its Security Council - to enhance its ability to lead. But even if informal arrangements and small groupings can give impetus and mobilize action on some issues, they are no substitute for a strong UN.

By mobilizing collective international will and commitment, the UN is vital for advancing peace and development. In addition, the UN and its funds, programmes, and agencies have unmatched legitimacy.

There are four points I would like to make which influence how we carry out our development work undertaking the long-term work of strengthening national capacities and fostering social cohesion.

 First, there is the need to address issues of inequalities and disparities, and meet internationally agreed development goals. Second tackling climate change requires urgent action, but also presents opportunities for development. Third, fostering good governance and promoting peace and stability is a pre-requirement for sustainable development. Lastly, partnerships matter.

First, in the long run, growth and development should be inclusive of different segments of society for it to be sustainable and for it to be efficient in fighting poverty and promote stability.

Creating greater equality and empowerment, and reversing the growing vulnerability of people, is so important to improve human well-being.

For twenty years now UNDP has been advancing a human development approach which is central to such endeavors. As many of you no doubt know, human development is about placing people at the centre of development, enlarging their capabilities, and expanding their opportunities and freedom to lead lives which they value and to be able to carry their choices.  Although the Human Development agenda goes beyond the Millenium development goal, let me concentrate for a moment and this important agreement to achieve the MDGs by 2015.

2010 is an important year for advancing this agenda. In September there will be a high level summit at the UN on the eight Millennium Development Goals. It will be a major opportunity to generate renewed commitment to reach the goals, and identify remaining gaps in their achievement and how best to fill them.

These eight goals seek to reduce poverty and hunger, empower women, increase access to essential services like education, healthcare, clean water and sanitation, foster decent work and environmental sustainability and forge strong global partnerships for development..  The MDGs and the Millenium Declaration are the highest profile articulation of the internationally agreed development agenda and were adopted by 189 states, 147 of which were represented by their head of state.

Now there are five years left until the 2015 deadline for meeting them. Based on the most recent data we have, we can report that positive progress has been made.
At the global level there have been sizeable reductions in poverty and child mortality rates, and increases in primary school enrolment INCLUDING WOMEN, and access to HIV treatment and clean water.  This is true also for the poorest countries, including Sub Saharan Africa that has made huge improvements in child health and primary enrolment.

Yet, significant challenges remain.  Progress has been uneven and many targets will be missed without additional effort and commitment.

If we leave aside China’s progress in lifting hundreds of millions of people out of poverty, the number of people living in extreme poverty measured by the $1 a day indicator is estimated to have increased between 1990 and 2005 by about 36 million, 92 million in SubSaharan Africa and 8 million in West Asia. Let me read some of the numbers from the SG report issued just some weeks ago:  pag. 4.Maternal mortality targets are not going to be met across continents, progress in this area has been extremely low going from 480 deaths per 100.000 live births in 1990 to 450 in 1995.  In 2005, developed regions report nine maternal deaths per 100,000 live births compared to 450 maternal deaths in developing regions, where 14 countries have maternal mortality ratios of at least 1,000 per 100,000 live. In 2005 Costa Rica reported 30 maternal deaths for every 100,000 live births.

Now, the economic crisis has added additional burdens on many countries.
Now that world trade is set to rebound in 2010, growing at 9.5 percent (After the sharpest decline in more than 70 years in 2009 according to WTO) and that the IMF is projecting that the world economy will grow by 3.9 per cent this year (after an estimated drop of 0.8 per cent last year) we must not forget the toll which the global crisis has taken on human development. |

The World Bank recently estimated that roughly 64 million more people around the world will be living in extreme poverty by the end of 2010 than would have been the case had there been no global economic crisis.

What is happening to poverty rates both reflects and affects employment trends.  The ILO has estimated that the number of people unemployed jumped by between 24 and 43 million between 2007 and 2009. 

Recovery from past recessions tells us that there could be a very significant time lag between the return of economic growth and a lift in employment and in poverty rates.  It is not only that we need to create millions of jobs simply to return to pre-crisis levels of unemployment (300 million new jobs). To have a chance of achieving the MDGs in many countries, significantly more and better jobs will need to be created.

Due to high inequality and lack of social protection systems that will cover the most vulnerable, too often the short term effects of the economic crisis translate on a long term lost in the well being of poor families.  High growth volatility is no doubt an important factor in a vicious cycle of high poverty and inequality rates.   Income inequality within countries has increased in many parts of the world. Since 1985, out of 132 countries for which data is available, the Gini coefficient worsened in 77 countries, while 53 improved and 2 showed no change.

In responding to the economic crisis, UNDP has been supporting developing countries to analyze the impacts of the crisis on their people. And we have been providing advice on policy responses, including on approaches to social protection. 

In Mauritius, for instance, we helped the government prepare its stimulus package.
In Paraguay, UNDP has supported the implementation the country’s conditional cash transfer programme for social protection.

UNDP and ILO are also working together in many places on policies which promote sustainable employment, including through the development of small and medium-sized enterprises, inclusive financial sectors, and ‘pro-poor’ business investment.  
Aside from responding to the crisis, across the developing world we help governments design MDG-based national development strategies, macroeconomic policies, debt sustainability frameworks, and public financing strategies.

In Niger, UNDP has helped local authorities meet the MDGs. Some of those authorities have already taken measures to boost primary education enrolment as a result. 

One other crucial factor to meeting the MDGs is the need for empowering women and girls.

Achieving gender equality is not only an MDG in its own right, but it can help meet other MDGs too.

Evidence shows, for instance, that an increase in the share of mothers with a primary or secondary education is associated with a reduction in the child mortality rate, and that educated parents have better nourished children.

As a former Vice-President of Costa Rica, I also know that increasing the voice and participation of women in politics, especially in national legislatures, is critical for putting women’s issues firmly on the table.

In many countries - from Albania to Papua New Guinea - UNDP has been supporting national efforts to increase the number of women parliamentarian.

Efforts like ours to empower women economically, legally, and politically can have significant dividends in advancing development and achieving the MDGs. 

But we know also 4 important things I want to highlight. 

•    One is that the big challenge is not to know what interventions work but how to upscale them to a critical mass and cause systemic change.  
•    Secondly we know that we can achieve the goals on an unsustainable manner (eg, food distribution vrs food production and rural development,  the same is true if peace and stability and a Government accountable to its citizens does not persist or if reliance on heavy aid, even more, short term aid via a vis internal mobilization of resources to hard won MDG gains).  The risk of disasters, armed violence, and conflict are a major threat
•    We need to go beyond the tyranny of averages and we know that the MDG are not independent one from the other.  
•    and finally that growth, trade and investment play a central role and these elements are for sure anchor on a national strategy.  National ownership, commitment to social investment, sound economic policy ( a pragmatic and heterodox mixture of policies) and capacity and institutional building is key.  But all these efforts are also highly dependent on the international behavior, the management of the global public goods, technology transfer and investment, and the global economic and financial governance.  Reducing world growth volatility and barriers to trade including agricultural subsidies in the developed world for example, are key for sustainable growth and achieving the MDGs in the developing world in general and more specifically in the LDCs. I will elaborate more about this in my fourth point later on.

This takes me to my second point. Are we going to be effective in the process of addressing climate change, also called the defining human development challenge of the 21st Century. Failure to respond to that challenge risks stalling and even reversing international efforts to reduce poverty. The most severe impacts of climate change are being experienced by vulnerable populations who have contributed the least to the problem.  Having said that, it is also true that combating global warming cannot be achieved without eventual reductions in emissions by both developed and developing countries.

We cannot hope to sustainably develop and achieve development goals if the way in which we develop undermines the health of our planet’s ecosystems. Human development and environmental sustainability must, and can, be tackled together. (see page 10 of the report).

Considerable support, over and above current ODA, is needed to help the least developed and low income countries meet their adaptation costs.  Similarly, these countries need help to follow lower carbon routes to development and energy access.
Adaptation and mitigation in developing countries would require financial assistance of perhaps and additional 1% of t he GDP of rich countries in 2015 in addition to ODA (to make the necessary investments in renewable energy and building resilience, get the technological know how and build institutional capacity).

At Copenhagen, developed countries committed to provide additional financial resources of around $30 billion for 2010-2012, and $ 100 billion a year by 2020, for support for climate change adaptation and mitigation in developing countries.

The details of the funding disbursement and the actual pledges are still to be finalized. But increased climate financing can help put countries on a sustainable development path.

The process of tackling climate change also opens up opportunities for green jobs in adaptation and mitigation. 

Together with our partner agencies, UNDP is supporting countries to pursue mitigation strategies and access to new and clean energy; and to reduce emissions from deforestation.

In many countries we are helping to address the climate needs of regions and communities.

Working with eight regional associations representing more than 1,000 regions, UNDP - in collaboration with the UN Environment Programme, and other partners - is developing a programme to support sub-national governments adopting low-carbon development paths.

The "Territorial Approach to Climate Change" aims to support such authorities to identify, develop and finance projects which can meet local needs, while building both climate resilience and the infrastructure needed for green growth.

The risks of social and political instability will increase in coming decades if climate change results in increased tensions over the allocation of essential natural resources like water, indigeneous population living in forest with high mineral and land resources, etc.

This means that all development actors need to think creatively about how to address these tensions before they boil over.

Guatemala, for example, is vulnerable to both drought and landslides from excessive rain. To help prevent resulting social unrest, UNDP has supported and are currently expanding a social dialogue around water resources in different territories.  This is contributing to agreements being reached between community representatives, private sector companies, and municipalities.

This brings me to my third point: that the promotion of good governance and peace and stability, are preconditions for sustainable development.

UNDP’s role is not political.  We are a development agency. Our role is to support governments at all levels to be transparent, accountable, and responsive to its citizens. This has been shown to be important for development progress to be sustainable.
UNDP helps countries strengthen their public administration, their efforts to decentralize, and their efforts to expand access to justice. We help strengthen human rights institutions across the globe, and support an election somewhere in the world on average every two weeks.

UNDP also works to support recovery from crisis and natural disasters and ensure that there is no gap between the provision of humanitarian assistance and development work. 

Various combinations of relief, early recovery, and development activities will usually take place in parallel after a crisis. There is growing recognition for the need for these types of interventions to be simultaneous rather than sequential, but always well coordinated. 

Early recovery activities seek to provide livelihood opportunities to those most affected by crisis, accelerate the provision of basic social services, rebuild local infrastructure, and prepare communities to receive back displaced persons and former combatants.
Without the deliverance of timely peace dividends, disaffected populations are more likely to vent their anger on each other or on the government, fraying social cohesion, and generating potentially violent tensions. Prolonged absence of basic services and nutrition affects people’s well-being, and makes it more difficult to resume sustainable economic activity.

The situation of Haiti after the recent earthquake is an example where we have been carrying out such activities.

I visited Port-au-Prince last month with the Secretary-General. Seeing the destruction and rubble everywhere it was clear how long the road to recovery is for Haiti.
Eight days after the earthquake hit, UNDP had started a cash-for-work project, and at the end of March, had employed over 75,000 workers – 40 per cent of them women - enabling them to earn an income as they help their country recover.

While removing rubble, garbage, and refuse which pose health hazards from the streets, previously unemployed people can now earn an income of around $4.50 per day and participate in the local economy, reviving it as they purchase goods and services of their choosing. The work opens up areas of the city for access by emergency vehicles and public and private transportation.

It also lays the foundations for mid-term recovery and development, such as access to markets, communal washing areas, and community centers.

Nine days ago in New York almost ten billion dollars was raised at a donors’ conference for Haiti’s recovery and development needs over the next three years.
Looking ahead, it is so important that the international community supports the leadership by and involvement of Haitians in the recovery process, and strengthens their capacities to play this role.

Civil society and the private sector must also be actively engaged to foster social cohesion and help generate inclusive growth.
Mutual accountability and transparency are also essential, as is coordination between the multitude of actors on the ground.

In many post-crisis countries the various military, security, development, and humanitarian actors are not always fully coherent in their actions. Yet it is so important to avoid duplication of effort and maximize development effectiveness everywhere.
Integrated funding mechanisms can help. Multi-donor trust funds, of the type the UN has been managing in a number of countries, have aided countries to direct funding to prioritized national programmes.

Haiti also highlights the importance disaster risk reduction. While we cannot prevent earthquakes or other natural disasters from happening, we can implement measures to ensure that they do not turn into such devastating events.

One of the other key challenges in Haiti now is to ensure that women and girls and other vulnerable groups are afforded the protection and security they deserve and need; and that women are fully involved in the recovery and reconstruction.

More generally, it is so important to meet women’s needs in post-crisis settings; and involve women in peace processes.

In 2000 the UN Security Council passed the landmark resolution 1325 on women, peace and security. It endorsed women’s full and equal participation in post-conflict decision-making processes. Other important resolutions have followed, strengthening this commitment and also addressing the systemic use of sexual violence as a tool of war.

My fourth and last point: leadership and partnerships are important for lasting development achievements.

In meeting long-term development goals, and moving forward on all these fronts, the world needs strong political leadership at all levels, and new and innovative partnerships which reflect changing global realities and the world’s growing multipolarity.
Leadership for development also means that issues of global significance, such as climate change and trade, must be addressed.

Agreeing with a recent article of Jose Antonio Ocampo, I think that is important to recognize that the Great recession as it is called (via a vis the Great depression) was tackle with the “largest Keynesian policies ever adopted in history” put in place by “several major developing countries and to the massive bailouts of financial institutions in industrial countries”.

A clear sign of the changing world we are in is that “The world had never experienced before a situation in which, given the weakness of industrial countries, major developing countries are, in a sense, the only available engines of world economic growth. Continuing expansion of these countries is therefore crucial for the world, but so is the capacity of these economies to transmit their growth dynamics to the rest of the world. The most important is, of course, China, which has a much larger share of global trade than other large developing countries. In the case of China, the capacity to induce growth in the rest of the world inevitably implies turning its large trade surplus into a balance or even a trade deficit. This problem is absent in other large developing countries, like Brazil and India, which have the tendency to run current account deficits anyway. “ (Ocampo, ibid)

It is also true that changes occurred also in the international response to the economic crisis where the response was also strong (and certainly stronger than during past crises), “as reflected in the largest emission of Special Drawing Rights (SRDs) in history, major innovations in IMF programs, some improvement in its conditionality, and rapid increase in lending by the Multilateral Development Banks. However, that response exhibited two major weaknesses. First, it was much weaker than the shock warranted, given the strong contraction in private financial flows, and came with a lag. In the case of the World Bank, large expansions in commitments were not matched by an equally dynamic pace of disbursements, so that its contribution to the recovery was marginal at best. Second, it was biased towards middle-income countries. This was reflected both in the responses from the IMF and the Multilateral Development Banks, as well as in reduction of Official Development Assistance (Ocampo, March 2009)”
Less progress has been experienced in the trade system. The poorest countries also have the most to gain from accessing currently protected markets. They currently bear the brunt of the stalemate in the WTO’s Doha Round. The elimination of trade distorting agricultural subsidies and the provision of unfettered market access to least developed countries will help them lift themselves out of poverty.

Where developing countries drive their own solutions, development results have a greater chance of being sustainable.

Development can best get traction if there is sound leadership and sound investments in people, institutions and infrastructure, and where countries are able to trade and grow in an inclusive way. 

Partnerships are vital too.

I know that ODA is not going to solve all the problems of developing countries. But, it can help strengthen the resilience and capacities which make sustainable development possible.

According to recent forecasts by the OECD, ODA levels in 2010 will be $21 billion short, in 2004 prices, of what donors pledged at the G8 Gleneagles meeting in 2005. Of this shortfall, $4 billion is the result of lower-than-expected donor GNI owing to the economic crisis. But $17 billion is the result of lower-than-promised giving. (the problem can worsen as the develop countries adjust for their very high fiscal deficits in the coming years)

ODA to Africa is projected to receive less than half of the $25 billion increase envisaged at Gleneagles.

Partnerships must also recognize the rise of the emerging economies and their growing geopolitical importance. This is giving real momentum to South-South cooperation. So are the agreements and treaties signed among the member states of ASEAN and Mercosur, for example.  

In this new environment, cookie cutter development solutions have no place, if they ever did.

Increasingly, the expertise and resources developing countries need are likely to come from across the South.

We are seeing this happen in a number of countries, and on issues ranging from sharing technology to access clean energy and boost agricultural production, to lessons on expanding access to HIV treatments. 

UNDP, with operations in 166 countries, can help support South-South exchanges of ideas and knowledge.

We recently helped to organize a conference which shared practical experience from Latin America with Asian countries already undertaking or considering cash transfer programmes.

These programmes have had a big impact on fighting poverty in the region where I come from, so sharing these lessons with other countries and regions can make a difference for the better elsewhere too.

The work and reach of civil society organizations and philanthropic funds is also important for meeting the MDGs and tackling climate change.

So is the role of the private sector.  One of your panels during this conference will be on the importance of mobile technology in driving social change. This is an excellent example of how the pursuit of profit can also support development results. 

UNDP has an initiative to promote business models in which wealth creation, human progress and environmental sustainability are seen as entirely compatible.

“The world we are looking forward at is going to be, in economic terms, much more dependent on the developing world than any we have observed in history. Never before has the call of the 2002 Monterrey Consensus (United Nations, 2002) to increase the participation of developing countries in global economic decision making been more important. Managing this world requires, therefore, major reform of global economic governance away from the industrial countries-centered institutions designed after the Second World War. The G-20 has been a step forwards in this regard, but its representation is inadequate (in particular, medium and small-sized countries are entirely unrepresented, and there are major problems of representation of Sub-Saharan Africa, among others), it is still dominated in its specific dynamics by industrial countries and, particularly, lacks the legitimacy of a body that is elected as part of a process of global consensus-building. So, in this area, as in the specific mechanisms to manage such a world economy, there is a long road ahead.”  (OCAMPO, MARCH 2009) And as we said before not a substitute to the legitimacy of the UN.

Working together, the UN development system and its partners can help foster the type of resilience needed to help countries cope with all the crises they may face, and lead them on a path towards sustainable development.

I hope this is a message you can take with you during the course of your conference, and, after your studies, as you look to put your development knowledge into practice for service of mankind.