Editorial


11/2003		  

The end and the means

Poverty reduction has always been the goal of development policy – ever since President Truman launched the US foreign aid programme in 1947. He wanted to help improve the lot of the half of humanity that was living in "conditions approaching misery" and he thought he knew what was needed to do it. In that, he proved mistaken. More than half a century later, despite a string of development concepts, no progress has been made in narrowing the gap between rich and poor. Only the frontiers have shifted: Korea has become richer, Argentina poorer.

Since 1999, a new concept has been making headlines: the concept of poverty reduction strategy papers (PRSPs), which are developed in connection with HIPC debt relief. Does the PRSP concept hold any more promise than earlier approaches? Does it bring hope for the poor? Perhaps it is too early to expect conclusive answers to these questions. At any rate, the authors addressing them on the Focus pages of this issue, come to conflicting conclusions. Birte Rodenberg criticizes Ghana's PRSP for being "committed more to promoting the private sector and the productivity of the poor than to augmenting their legal and social opportunities". Ann Kathrin Schneider, on the other hand, complains that the majority of PRSPs "propagate an increase in social spending" but do not say where the money is supposed to come from. In particular, they "cite no specific programmes designed to help the poor participate in growth processes" or define measures which could heighten the "productivity of the poor".

Behind these two judgements lie contrasting views of development and development policy. The one holds that the poor need to be given better access to social services and that the money for it must come from outside aid. The other is that the poor need to be empowered to boost their productivity so they can lead a self-determined, better life, which includes access to social services. Strictly speaking, the first is a perception of development aid as welfare assistance, with no conception of how it could be replaced by self-responsibility, while the second favours help for self-help, aimed at making outside assistance superfluous. This dichotomy can be seen not only in the expectations of critics but also in PRSPs themselves. Ann Kathrin Schneider notes that PRSPs "offer no explanation of how the extra revenue will be generated". Hopes are pinned on high economic growth but the papers contain no concept for attaining that growth, let alone ensuring that the income generated will benefit the poor. Pro-poor growth remains an empty phrase. What is expected instead is a greater inflow of funds from development aid. A similar misconception lay at the root of the 20/20 Initiative of the 1995 World Summit for Social Development in Copenhagen. The HIPC process rekindled that hope but there is no sign of donors being willing to countenance significant increases in ODA. So if PRSPs want to be taken seriously, they need to contain concepts for economic growth, with the emphasis on the large-scale creation of jobs. Development can occur only where countries increase their ability to shoulder the cost of national welfare themselves. Which is where many PRSPs are crucially flawed: they do not pay enough attention to economic development; they say where money should be spent but not where it should come from.

The participative process in which PRSPs were developed may have contributed to this shortcoming. Where participation is seen only as involvement of the poor, the result cannot be a concept for economic development; it will be largely a statement of expectations. Why did no one think of consulting the economic research institutes? That would not have been any less participative – participation does not need to exclude expertise. And since the PRS focus is on growth for the poor, why does the widely proven instrument of microcredits play such a meagre role in the strategy papers? Ann Kathrin Schneider is expressly critical of this fact. But it could all be made good in the future. PRSPs – we are emphatically told – are supposed to be constantly updated. So gaps can be plugged.

All this is not to say, however, that PRSPs have not brought progress. The important thing is that they are broadly based, that they are meant to provide the basis for the entire economic strategy of the country in question. Thus, they enforce greater cooperation and cohesion between donors. For each individual donor country, as well, PRSPs mean "more sectoral approaches [...] instead of the project and single programme support provided to date". This consequence, however, is little appreciated so far, as Frank Bliss notes in his report on the BMZ evaluation findings. The new policy has been implemented in some areas of BMZ activities, such as East Africa, but many other sections appear to be struggling to put it in place, preferring to stick to the approach that has always been adopted in the past. Of course, sector-wide approaches, basket financing and financing through multilateral organisations would also mean a less visible German flag – and warning voices are already being raised. In the Bundestag budget debate, Jochen Borchert (CDU) complained of a steady decline in national influence on development policy. I prefer to see that not as a drawback, but as a merit.