MDG GOAL 8

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

2. 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

3. Shortcomings of the MDGs • Top-down approach • Process 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

4. Shortcoming con’t. • Targets are selective and incomplete • Over emphasis on external financing • Distract attention from productive sectors, particular rural development • Distract attention from the macro-economic constraints inhibiting countries’ ability to development • Targets overly ambitious

5. 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.

6. 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)

7. 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

8. 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

9. 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 initiative • Any debt service savings will reduce future credits

10. 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

11. 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

12. 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)

13. 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

14. 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

15. 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

16. 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

17. 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

18. 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.

19. 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.

20. 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

21. 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

22. Neo-Liberal Economics • Rests on economic fundamentalism and marketism – the law of supply and demand • Achieved by • Privatization • Liberalization • De(re)regulation

23. 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 Privatization

24. 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

25. 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

26. 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

27. 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

28. Trade versus Aid In 2002 U.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

29. Where Are We Today? • Limited number of countries and peoples benefiting from global economic integration • Lack of a level playing field • Democracy deficit, concentration of economic and political power • Driven by corporate and financial interest • Diminished role of government

30. Today, con’t. • Ecological degradation • Lack of focus on social development and human rights • Growing global unemployment • Collapse of rural communities and sustainable agriculture • Concentration of wealth • Increased poverty

31. 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

32. 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

33. 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

34. Catholic Social Teaching Certain 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

35. 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

36. 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

37. Another World is Possible Global Community Not A Global Market