CHALLENGES FACING DEVELOPMENT IN 2014

Speech by Juma Mwapachu, President of the Society for International Development

'The major source of injustice today is to be found not so much in a condition of general scarcity as in the fact of diminishing marginal utility of man as such, in the fact that millions of people find themselves idle and useless, often in their very prime of youth.' (Rajni Kothari, 1977, Redesigning the Development Strategy)

When we met in Nairobi in June last year the theme of my Opening Address was the state of interesting times that coincided with our meeting. First, was the historic general elections that had taken place in Kenya and which had brought that country back together after the tragic post-elections violence of 2007. Unfortunately, the results of that violence continue to haunt Kenya and have taken a traumatic turn for the new national top leadership as it faces trial in the International Criminal Court here in The Hague.

Worse, the implications of the trial have become a major source of fracture in relations between the African Union and the International Criminal Court (ICC) and, by extension, the UN Security Council on whose mandate the ICC exercises its jurisdictional authority. Little wonder that the Fourth EU-Africa Summit Declaration of 4th April this year records the commitment 'to enhance political dialogue on international criminal justice, including the issue of universal jurisdiction.'

Second, was the trend in the performance of the East African Community region, the fastest economic growth area in Africa in recent years but equally with the fastest growing population that exhibits a huge youth bulge, growing unemployment especially amongst the youth and women, declining education standards, food insecurity partly driven by climate change factors and partly because science is yet to be adopted to boost agricultural productivity and serious cases of a whole set of inequalities, social, economic and political.

Third, was the growing influence of China in the region sparking a new wave of international cooperation spearheaded mainly by the United States and Japan. The lingering question is what role citizens play over such thrusts and outcomes in international cooperation? Could it be that emerging resource nationalisms in Africa are probably rooted in sheer disconnections between the political elite and the citizens? Has democracy and good governance been hijacked by a few political leaders for their own self-interests?

Fourth, I offered a snapshot of the state of security in the region, recalling the genocide in Rwanda whose 20 years history was globally commemorated last week on 7th April. It would now seem that barbaric human atrocities never seem to end as so well orchestrated by the on-going Syrian situation.

I had remarked last year that these tragic lessons present for SID the opportunity to open up spaces for national, regional and global dialogue and conversations around the collective desire of promoting inclusive social change and transformations. The aim being to heal wounds and catalyse new vistas of human tolerance, solidarity, cohesion and shared quests for common prosperity.

As we meet here today, some of the issues and questions that I had raised last year still linger on. In fact, some of them, though examined from the narrow perspective of the East African region, have taken a more serious posture at the global level. The challenge of inequality stands out above the rest. Hazel Henderson recently wrote an article titled 'Facing Up To Inequality: New Approaches Beyond Economism' in which she postulates as follows:

'Grim recent studies reveal the shocking increase in inequality globally, both between and within countries. Anti-poverty economic policies since World War II have done little, except for their notable success in China.

Worldwide, the share of nations' productivity increases going to employees is shrinking-while the share to capital owners, financial firms, corporations and their top executives as mushroomed. Old economic textbooks remedies for rising inequality still call for more growth. Yet economic growth is slowing in most mature economies. In still growing China, India, Brazil and other emerging countries, the growth remedies lead to greater inequality as well as destroying traditional livelihoods polluting vital common resources: air, water, forests and bio-diversity.'

The author proceeds to point out that 'structural unemployment and jobless growth are accelerating inequality.' This position reminds me of a 1977 book article contribution by the celebrated Indian social scientist, the late Rajni Kothari, titled, 'Redesigning the Development Strategy' in which Professor Kothari posits that 'The major source of injustice today is to be found not so much in a condition of general scarcity as in the fact of diminishing marginal utility of man as such, in the fact that millions of people find themselves idle and useless, often in their very prime of youth.'

It is a realistic representation of cruel conditions that obtain in many countries today. In South Africa, for example, the surge in social and political tension and instability, interposed by frequent mine workers' strikes, is not because Nelson Mandela, the architect and symbol of a tolerant social order and a sense of a possible future of hope for the majority South Africans, is no more. Rather, it is because two decades after the unshackling of apartheid, poverty and inequality are now more pronounced and brought into the open by the democratic environment. Moreover, the wealth divide along racial lines, minus for a few black billionaires who have benefitted from the Black Economic Empowerment Programme, has taken a more heightened posture.

Whilst the inequality situation is extreme in South Africa, it is the pervasive disease that devours most African countries. SID's State of East Africa Report 2013 has exposed the depth of inequalities in the East African Community countries, manifested in heightened levels of joblessness, income inequalities, high levels of malnutrition, generally poor quality of education and high levels of illiteracy, minimum power and resources by citizens to hold governments to account reflective of unequal distribution of opportunity and rewards of growth.

It may seem like a paradox, but inequality is equally proving to be a condition of serious gravity in the rich countries as well. In his magisterial book, 'The Price of Inequality-How Today's Divided Society Endangers Our Future', Nobel Laureate, Joseph E. Stigliz argues that 'Unemployment - the inability of the market to generate jobs for so many citizens-is the worst failure of the market, the greatest source of inefficiency, and a major cause of inequality'. Stiglitz visualises social cohesion being transformed into class warfare in countries like the United States.

Overall, the challenge of inequalities in Africa has cost some governments to lose political power. I need not go into the causes of the Arab Spring because I believe that it is now common knowledge that high levels of unemployment, especially among the youth, coupled with declining wages in relation to real costs of living, lay at the heart of those citizen- managed and directed revolutions.

Inevitably, there is now serious concern in many countries that if not quickly and effectively addressed, inequalities could soon become the main source of social and political instability in Africa. As Professor Stiglitz cautions in his book above referred to, 'when the social contract gets broken, social cohesion quickly erodes.'

The second lingering issue centres on the state of international cooperation. In many respects the struggle for investment and aid supremacy in Africa and especially in the East African region continues with the Chinese still in the forefront though the US is increasingly promoting its private firms to invest in the power sector. Paradoxically, Chinese investments remain focused in metals and in supporting transport infrastructure development with little interest in the mining and oil and gas sectors.

Where traditional international cooperation seems destined to suffer is in the area of multilateral trade agreements. Emerging Asia, especially China, India and somewhat the Arab Gulf States, are becoming the major trading partners of sub-Saharan Africa.

As a result, it would not be strange to see a steady erosion in interest from SSA countries over the WTO Doha Development Agenda and the Economic Partnership Agreements. The deemed traditional mutual gains out of trade between sub-Saharan Africa and the European Union may slowly become skewed much as countries that trade with the EU in cut flowers and frozen lake fillet fish may suffer loss in exports returns.

However, there are moves towards exports diversification that respond to resultant downsides in this trade paradigm. Even then, sub-Saharan Africa countries would have to seriously assess the broader negative impact that may take place beyond trade as a result of such shifts in trading relationships.

In particular, the strong partnership that has been built between the EU and Africa in the peace and security architecture born out of the Lisbon Summit Agreements in 2007 may prove to be quite onerous.

Recently I have read a book by the British politician, Liam Fox titled, 'Rising Tides-Facing Challenges of a New Era' and he makes one very profound statement about the changing dynamic of world order. Mr Fox asserts:

'How is the world likely to evolve? I have thought for some time that if the twentieth century was the era of the block-the economic block, the military block and the trade block-then the twenty-first century is likely to be the era of the organic solution. We will need to find new partnerships, new alliances, and new mechanisms to deal with a whole new range of challenges. We will need to develop new levers to pull in a wide variety of situations-the age of the one-size-fits-all solution is, I think, behind us. Should this fill us with dread? Not at all. In fact, I believe there are reasons to be optimistic about our ability to create novel solutions to our common problems.'

At a time when global society had settled down to accepting a new world order after the fall of the Berlin war and the territorial re-configuration of the Soviet Union and Russia becoming integrated in the G-8, there are creeping signs of a return to cold war rhetoric and politics. Russia's military intervention into Ukrainian territory and the annexation of the Crimean Peninsula in Southern Ukraine ostensibly following a plebiscite in Crimea supporting unification with Russia has serious implications for global peace and security.

Coming in the wake of two costly wars in Iraq and Afghanistan, the United States is unfortunately left weary. The EU has also gone through three to four years of serious economic stress and turmoil and its political strength has weakened. Moreover, the global economy, especially of the advanced economies, is generally experiencing a below par economic growth with high levels of unemployment and stark inequalities.

It is an environment that is not conducive to supporting ideal levels of international cooperation.

Juma V. Mwapachu is President of SID and former Secretary General of the East African Community (EAC). This was his keynote speech delivered to the Society for International Development’s Governing Council.

Photo courtesy of NASA

The views represented are those of the authors, and may not represent those of ECDPM


This speech was originally published by the Society for International Development