Imagine you are an ER doctor trying to treat a very ill patient who has no medical history and only a vague recollection of symptoms. What would you do if you were the doctor? Trust your gut? Trust that the patient has chronicled his symptoms accurately enough to warrant an accurate diagnosis? This is perhaps how policymakers and aid workers felt back in 2001 when they were deciding where to begin the reconstruction of Afghanistan.
Recently, a friend from Indonesia visited me in Nairobi. He is one of the world’s leading experts on social development and a long-term Jakarta resident. One of his observations stuck in my mind: “Kenya is just like Indonesia ten years ago”, he said.
Comparing Kenya with Indonesia is counterintuitive—except perhaps when it comes to traffic jams—because of the many differences between the two countries. Indonesia is the world largest island state with more than 17.000 islands and a demographic heavyweight with 240 million people (six times more than Kenya). It is also 85 percent Muslim, while Kenya is about 85 percent Christian. Indonesia has massive natural resources – coal and gas (and some oil) – that it exports to other Asian countries, especially China, while Kenya’s economy is fuelled by a strong service sector.
There are many more reasons to challenge a comparison between these two countries but when one digs below the surface, there are also some similarities. Economically my friend was spot on: in GDP per capita terms, Kenya is roughly at the level of Indonesia a decade ago (about US$800 per capita). Today Indonesia is far ahead, but I don’t see any reason why Kenya couldn’t follow suit. Indeed, Indonesia is a good benchmark case for Kenya because it was never a “star reformer”, but instead a consistently strong performer.
Imagine a low-income country in the developing world suddenly discovering a large endowment of natural resources within its borders. Perhaps a large oil reserve is found just offshore, or a deposit of valuable natural minerals is uncovered just below the earth’s surface. Surely, such a discovery would be a blessing, as it would expand the country’s total stock of capital.
UPDATE (May 15th, 2012) Caroline Freund, World Bank Chief Economist for the Middle East and North Africa has joined the debate. See her remarks.
The Chief Economists of all the regions where the World Bank implements programs got together recently to exchange thoughts about the current state of development economics.
You can read a summary of our views related to Africa, South Asia, and Europe and Central Asia here.
And we hope you can participate in this debate by sharing your own views via the comments section below.
Can economics trump politics in South Asia, a region fragmented by decades of strife? Will greater regional cooperation and lowering barriers to trade bring harmony along with economic growth?
Those were the questions on the table Thursday as a panel from across the region discussed “Breaking Down Barriers: A New Dawn in Trade and Regional Cooperation in South Asia.”
Most panelists expressed optimism about trade’s pacifying abilities. Moderator Barkha Dutt, an Indian television journalist, opined that “What trade does, in its very ordinariness, is modulate the emotions.” Teresita Schaffer, former U.S. ambassador to Sri Lanka, agreed that “Trade can provide another conversation… and provide reasons why rivalries should not be allowed to get out of hand.”
But which comes first, the chicken or the egg? asked another panelist, Nepali journalist Kanak Dixit. Clearly, he said, it’s the chicken (commerce), because other things have been tried and have not worked. He said that “chicken” will lay two “eggs”: peace and prosperity.
Part of a series on social inclusion
China is talking of a harmonious society, Brazil of social integration, India of social inclusion, and so on. The United Nations just released its first World Happiness Report, and more and more countries are asking their people how they feel! The social aspects of growth are causing more anxiety in the last few years than arguably ever before, as the Economist said, reporting on a 2010 Asian Development Bank meeting in Tashkent.
Social inclusion is a pillar of the Bank’s social development strategy, and we have just embarked on a new policy research program through an upcoming flagship report. In the process, we hope to position social inclusion as a central feature of the World Bank’s work on equity and poverty.
In stark contrast to a few years back, Latin Americans are deeply worried these days with a rising wave of crime and violence that is causing a huge loss of life and resources –and making people rethink the role of public and private sectors in fighting this scourge.
In debates across public fora and on social media platforms Latin Americans are more tolerant of the idea of private-public partnerships to fight crime.
Juga tersedia di Bahasa
My first trip to Aceh was in August 1998, four months after the resignation of former President Soeharto. It was the height of Indonesia's pro-democracy Reformasi movement, and many journalists thought that travel permits were still required, as it had been for decades. My friend and I were venturing as 'tourists'. In many villages, the legacy of repression remained: razed houses, shuttered schools, and households run by widows. Poverty was unavoidable; violence and economic growth are often incompatible.
Available in English
Saya pertama kali berkunjung ke Aceh pada Agustus 1998, empat bulan setelah mantan Presiden Soeharto meletakkan jabatannya. Saat itu adalah puncak gerakan Reformasi di Indonesia, dan banyak wartawan yang mengira bahwa masih dibutuhkan izin kunjungan untuk pergi ke Aceh, seperti yang memang dibutuhkan selama beberapa dekade. Saya dan rekan saya berkunjung sebagai “wisatawan”. Warisan penindasan memang masih banyak tersisa di banyak desa: runtuhan rumah-rumah, sekolah-sekolah yang tutup dan rumah tangga yang dikepalai oleh janda-janda. Kemiskinan tidak dapat dihindari: kekerasan dan pertumbuhan ekonomi hampir tidak pernah berjalan bersama.
También disponible en español
Rewind 20 years. Medellin, Colombia, is the murder capital of the world, with over 300 homicides per 100,000 inhabitants.
Pablo Escobar and his drug trafficking cronies are the heroes of the comunas -- the hillside low-income barrios that oversee the skyscrapers of the modern downtown. Shootings, kidnappings and rampant lawlessness are the stuff of daily headlines. Teenage boys in the comunas want to be Escobar henchmen, quick with the gun and fast with the girls. And after Escobar was killed in a graphic shootout with police in 1994, they dream of becoming paramilitary ‘rambos’, inspired by the violent squads that plagued the countryside since the mid-1990s.
We know the impact of violence can last generations. We also know that people can be affected by repeated cycles of conflict and instability. The result is that the poor get poorer and become less resilient to further shocks, whether natural or man-made.
Imagine a conversation. “So, your company is expanding its operations in country x, but I hear there is a lot of frustration among young people about unemployment. Are you worried about the possibility of political upheaval?” And the investor responds, “We’re not very worried about any instability. The current government has been in power for decades and we’re very well connected, so if there are any problems, we’ll be protected.” Without naming names, we can think about how this approach to risk management may have failed investors as of late, but such reversals of fortune predate the days of Twitter and Facebook – take the fall of the Suharto regime in Indonesia. At MIGA’s recent discussion titled “Best Laid Plans? How Ignoring Political Economy Affects Development Outcomes and Increases Risk", this attitude toward risk was aptly labeled “risk myopia.”
More often than not, “we” criticize the “system” for being corrupt; yet it is simply a reflection of what we make of it. For example, what would happen if “we” decided never to collect bribes from users in our health service system? Or if we implemented and respected the rule of ‘first come, first served’ instead of paying or collecting bribes for faster service delivery? What would happen when it is brought to our knowledge that there are irregular practices operating within our health centers?
More often than not, “we” criticize the “system” for being corrupt; yet it is simply a reflection of what we make of it. For example, what would happen if “we” decided never to collect bribes from users in our health service system? Or if we implemented and respected the rule of ‘first come, first served’ instead of paying or collecting bribes for faster service delivery? What would happen when it is brought to our knowledge that there are irregular practices operating within our health centers?
These questions are for everyone, particularly for authorities in health centers. These kinds of questions are being answered by winners of the Cameroon 2011 Development Marketplace competition. Nowadays, advances in ICT tools and social media channels provide us with various ways to monitor and expose corrupt practices. When I first visited the website of I Paid a Bribe by the Janaagraha Centre for Citizenship and Democracy, I was amazed by the innovation, frightened by testimonies, and thankful to those who had the courage to report irregular practices. My next move while browsing the website was to check if Cameroon was amongst those countries participating on this platform. Unfortunately not!
