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‘Aid must not be politically linked…”


MAY 26, 1993

Interview : MAHBUB UL HAQ

Aid must not be politically linked…”


Mahbub ul Haq of Pakistan is widely regarded as the reigning guru of development.  A former finance minister of his country, and an advisor to Robert S. McNamara when the latter was president of the World Bank, Haq has served as Special Advisor to the Administrator of UNDP for the last several years.  He is the chief architect of UNDPs annual Human Development Report.  He spoke last week with The Earth Times. Excerpts:

In the 1993 report, the phenomenon of jobless growth is mentioned.  Can you comment on this?

“Jobless growth” is a new and a disturbing phenomenon.  Industrial output has increased, but jobs are lagging behind.  Take Germany, for instance.  From 1960 till 1987 output increased from an index of 100 to 260, more than two and a half times.  But in the same period, employment fell from an index of 100 to 91.  There are similar experiences in France and other European countries.  In developing countries the labor force is increasing fast because of population growth.  And, in addition, there are other elements adding to the labor force.  Women are coming into the labor market, life expectancy has increased, so people of working age live longer.  And there is more migration from the job market who were previously living off the land.  There is an explosive growth in labor force.  It certainly means that more automation, more machines taking over from people, both in developing countries and developed countries.  What is the way out? The thing that can done is to invest in people.

What about disparities

There are two things that are extremely important in this perspective — First, the US is not the worst case in the world.  In fact, it is very commendable that the US is very open and transparent in its census data.  All these figures are based on the 1990 census which is a remarkable document in terms of giving all the information regarding the minorities and their income.  We tried to get similar information on UK, France and Germany and discovered that in many countries there is a legal bar to having data published  by race and ethnic groups.

It appears that many societies believe that by hiding the problem they are resolving it.  And one of the first things we wanted to advocate by publishing this data was not to put the US o the spot, but to put pressure on other countries that they should have similar data and face up to the problems as openly as the US has.  Secondly, the US is an open society.  It has a long tradition of civil rights movement, legislation and many affirmative actions against discrimination.  It has more opportunities for a mobile labor force and a good deal of media pressure on issues of disparities.  Still, we find that despite all this, after decades the disparities among the ethnic groups is so large as to be shocking.  Just imagine what kind of socioeconomic lava must be building up in many developing countries.

What about conditionalities?

I have often wondered what will be the new motivation for aid and global cooperation.  In the past, aid was often given to buy alliances in the Cold War – the struggle ws against the export of Communist ideology.  My won feeling is that the enw motivation for aid in the future will arise out of fear rather than hope.  Fear that global poverty will travel across international borders in the form of drugs, pollution, migration , terrorism, political instability and future diseases more deadly than AIDS.  We have still not recognized that it takes less to deal with problems upstream at the beginning, as in preventive action and diplomacy, than it takes downstream through curative measures or emergency assistance.

Another important message of the report is that territorial disputes and civil unrest arise out of a lack of economic opportunity and resources.  Could you explain this?

We should realize that the conflicts of the future will likely be  between  people  rather than between nations.  We are seeing the beginning of that phenomena in Bosnia, Somalia and Sri Lanka.  These are not external threats but internal conflicts. They arise out of frustration over limited economic opportunities, limited number of jobs and socioeconomic and ethnic disparities.  We are suggesting what we call the 20/20 proposal.

Developing countries earmark 10 percent of their annual budget to human priority concerns, we are suggesting a raise to 20 percent, by reducing military expenditures and privatizing inefficient public enterprises.  On the aid budget, only 6.5 percent is earmarked for human priorities.  We are advocating to the donors that at least 20 percent should be earmarked for this.  This will require no additional resources or more taxation but only restructuring of priorities in existing budgets.

If an additional 30 billion dollars a year is available, it will take care of (for the next ten years) the essential human agenda of the developing world –education, primary health care for all family planning services, nutrition programs and clean drinking water.  What’s more it will have a salutary impact on population growth.  Human Development is the most powerful contraceptive, particularly female education.

According to the analysis we have made in all our report, wherever female education has gone up population growth has gone down dramatically.  It would cost only tw and a half billion dollars additional to give girls the same level of education as boys.

The industrialized countries feel threatened by migration.  But isnt it true that the bulk of migration takes place within developing countries themselves and they have to bear the brunt of it?

It is true that migration still is a very small figure as far as the industrial countries are concerned .  But my feeling is that the 21st /Century will see unpredicted movement of people across international frontiers.

It will happen in two stages: people won’t migrate, but poverty will because poverty respects no international borders and it will migrate in very unpleasant and unproductive forms like drugs, pollution, diseases and terrorism.  Developed countries will get involved.

Secondly, I believe we are hearing now the quiet steps of international migration.

In the last 10 years, 75 million people moved across borders in search of economic opportunities but they were mainly between developing countries across immediate borders.

They have not yet come to industrial countries because of tremendous immigration controls, except few cases like the Mexicans coming into the US, and the US being obliged to think of trade areas to take opportunities and jobs to Mexico.

In the long run, do democracies really work?

This has been a perennial question which has been asked a lot whether development and

freedom go together, whether democracy is necessary or even sufficient condition for economic growth.

The historical evidences were not very reassuring, sometimes growth came in freer societies like the United States but often economic growth took place in societies which were not democratic as in South Korea under Gen. Park and Chile under Gen. Pinochet.

However, we are living in an age of information.

It is no longer possible to hide human cruelty in some dark corner of the planet.  CNN or some other media will bring it to your doorstep.

While in the past, models of development were centered around production, now models of development are centered around people.

Freedom is a fundamental choice.

It is true that during economic development many structural decisions have to be taken.

Discipline is necessary and I worry at times about the inability of Western democracies to make any painful decision.