Hafiz A. Pasha WHAT IS THE EXTENT OF SOUTH ASIAS PROGRESS ON THE - - PDF document

By

Hafiz A. Pasha

 WHAT IS THE EXTENT OF SOUTH ASIA’S PROGRESS

ON THE MDGs?

 WHAT FACTORS HAVE DETERMINED THE RATE OF

PROGRESS?

 WHAT HAS BEEN THE EXTENT OF INCLUSIVE

GROWTH IN SOUTH ASIA?

 WHAT SHOULD BE THE DEVELOPMENT AGENDA

BEYOND THE MDGs?

Number of Countries with Data Number of Countries on Target

%

MDG 1: Extreme Poverty 5 1a 20 MDG 1: Hunger 4 1 25 MDG 2a: Primary 6 3 50 MDG 3a: Gender Parity (Primary) 8 6 75 MDG 3a: Gender Parity (Secondary) 8 6 75 MDG 4a: Child Mortality (under 5) 8 3 38 MDG 5a: Maternal Mortality 8 3 38 MDG 7c: Access to Safe Water 7 4 57 MDG 7c: Access to Sanitation 7 2 29

Source: Global Monitoring Reports, 2011, World Bank

* The countries are Afghanistan (LIC), Bangladesh (LIC), Bhutan (LMC), India (LMC), Nepal (LIC), Pakistan (LMC), Sri Lanka (LMC).

1990 2005 2008 Distance covered to Achieving Target Global

41.7 25.2 N.A 79

• f which:

East Asia and Pacific

54.7 16.8 14.3 148

(China)

(60.2) (15.9) 13.1 156

South Asia

51.7 40.3 36.0 61

(India)

(51.3) (41.6) 32.7a 73

Sub‐Saharan Africa

57.6 50.9 N.A 23

Latin America

11.3 8.2 6.5 85

afor 2010

Source: World Bank, Global Monitoring Report, 2011.

(%)

 ALTHOUGH RATE OF ECONOMIC GROWTH IN THE REGION HAS

BEEN RELATIVELY HIGH

 BUT IT APPEARS THAT THE PROCESS OF GROWTH HAS NOT

BEEN INCLUSIVE ENOUGH, ESPECIALLY IN TERMS OF BENEFITING THE LOWER INCOME GROUPS

 ALSO, THE GLOBAL ENVIRONMENT HAS GENERALLY NOT

BEEN SUPPORTIVE FOR ATTAINING THE MDGs

2000 to 2005 2005 to 2010 2011 South Asia

6.5 7.9 6.5

(India)

(7.0) (8.6) (6.9)

East Asia and the Pacific

8.4 9.8 8.3

Low and Middle Income Countries

5.4 6.6 6.4

Source: World Development Indicators (WDI), World Bank

 INEQUALITY HAS INCREASED AMONG COUNTRIES  INEQUALITY HAS INCREASED WITHIN COUNTRIES

 14LDCs: AFGHANISTAN, BANGLADESH, BHUTAN, CAMBODIA, KIRIBATI, LAO PDR,

MALDIVES, MYANMAR, SAMOA, SOLOMON, ISLANDS, TIMOR LESTE, TUVALU, VANAUTU

 4 LDCs ARE LANDLOCKED AND 6 ARE SMALL ISLAND STATES  5 LDCs ARE IN SOUTH ASIA, 4 IN EAST ASIA AND 5 IN THE PACIFIC  POPULATION OF 258 MILLION; 37% OF GLOBAL POPULATION OF LDCs.  AVERAGE PER CAPITA INCOME IS $ 513  4 LDCs ARE CLASSIFIED AS SEVERELY INDEBTED  GDP GROWTH RATE IS HALF THE REGIONAL AVERAGE  ODA PER CAPITA IS 1/3rd OF SUB‐SAHARAN AFRICA

PERCENTAGE OF COUNTRIES* OFF‐TRACK LDCs All Counties (excluding LDCs) $ 1 Poverty 100 26 Malnutrition 50 43 Infant Mortality 86 47 *Includes Central Asia Republics. All countries of Asia Pacific for which data is available Source: UNESCAP DIVERGENCE OF GROWTH

Source: World Bank

Countrya Earliest Year Gini Latest Year Gini Bangladesh 1996 41.2 2010 (32.1)* India 1990 29.6 2005 33.4* Nepal 1996 38.4 2010 32.8* Pakistan 1990 28.7 2008 30.0* Sri Lanka 1991 34.0 2007 40.3

*According to WDI.

• Inequality has also increased in most countries of East Asia and the Pacific, specially China

Source: WIDER, UN, Inequality Data Base.

1990-1999 1999-2004 2004-2008 South Asia

• 0.60
• 0.59
• 0.47

Low and Middle Income Countries

• 1.18

Source: Pasha (2007), derived

1)

RELATIVE POOR PERFORMANCE OF AGRICULTURE, ESPECIALLY FOOD PRODUCTION

2)

LOW EMPLOYMENT RESPONSE TO OUTPUT GROWTH

3)

LOW AND SLOW IMPROVEMENT IN LEVELS OF HUMAN DEVELOPMENT

4)

SPURT OF INFLATION, ESPECIALLY IN FOOD PRICES, DURING LAST FEW YEARS

2000 to 2005 2005 to 2010 2011 AGRICULTURE South Asia 2.6 3.2 2.9 Low and Middle Income Countries 3.4 3.6 3.8 INDUSTRY South Asia 7.3 7.9 3.7 Low and Middle Income Countries 6.2 7.4 6.9 SERVICES South Asia 7.9 9.1 8.3 Low and Middle Income Countries 5.5 7.1 6.6

Source: WDI

 ANNUAL GROWTH RATE OF FOOD PRODUCTION

2000 to 2005: 1.9% 2005 to 2010: 2.6%

 ANNUAL GROWTH RATE IN PRODUCTION OF CEREALS

1998 to 2008 Rice: 1.7% Wheat: 1.2% Cereals: 1.8%

 SOUTH ASIA NOW HAS A NET DEFICIT IN TRADE IN FOOD ITEMS  IMPORTS OF WHEAT HAVE REACHED A PEAK OF OVER 10 MILLION

TONS

 THE PROPORTION OF UNDERNOURISHED IN POPULATION HAS

DECREASED MODESTLY FROM 21.5% IN 2000 TO 17.8% IN 2011

Source: WDI, World Bank FAO

Annual Rate of Growth 2000 to 2005 2005 to 2009 2010 South Asia 2.1 2.2 0.0 (Employment Elasticity) (0.32) (0.29) (0.0) Low and Middle Income Countries 1.8 1.6 1.5 (Employment Elasticity) (0.34) (0.25) 0.23

• BETWEEN 2005 AND 2010, THE SHARE OF AGRICULTURE IN

EMPLOYMENT HAS FALLEN FROM 54% TO 51%, WHILE THAT OF INDUSTRY HAS INCREASED FROM 19% TO 22% AND THAT OF SERVICES HAS FALLEN FROM 28% TO 26%.

Source: WDI

 5 SOUTH ASIAN COUNTRIES ARE IN THE LOWEST QUINTILE OF COUNTRIES

IN THE HUMAN DEVELOPMENT INDEX AND 3 IN THE SECOND LOWEST QUINTILE

 MOST SOUTH ASIAN COUNTRIES HAVE FALLEN SHARPLY IN HDI RANKINGS

IN 2011

 RANKINGS IN GNI PER CAPITA ARE GENERALLY HIGHER  OVERALL, SOUTH ASIA’S HDI RANKING IS THE LOWEST AMONG REGIONS OF

THE WORLD, EXCEPT SUB‐SAHARAN AFRICA

 RATE OF INCREASE IN HDI VERY SLOW IN RECENT YEARS  WHILE MOST SOUTH ASIAN COUNTRIES HAVE PUBLIC EXPENDITURE ON

EDUCATION OF 3.5 TO 4% OF GDP, EXPENDITURE ON HEALTH VERY LOW AT ABOUT 1% OF GDP

Source: Global Human Development Report, UNDP.  SPURT IN INFLATION  DOUBLE‐DIGIT INFLATION LAST FOUR YEARS, ESPECIALLY IN FOOD PRICES, IN MOST SOUTH ASIAN COUNTRIES  MORE ADVERSE IMPACT ON LOWER INCOME GROUPS  THE TRADE IMBALANCE HAS BEEN ADVERSELY IMPACTED BY THE

ALMOST SEVEN FOLD INCREASE IN THE OIL IMPORT BILL DURING THE LAST DECADE

 FISCAL DEFICITS HAVE BEEN RISING, EXCEEDING 8% OF THE GDP IN

SOME COUNTRIES. LIMITED FISCAL SPACE FOR EXPANSION OF SOCIAL PROTECTION PROGRAMS

Sources: IMF, WTO, ADB, World Bank

POLICIES AND PROGRAMS SHOULD INFLUENCE THE PROCESS OF GROWTH SUCH THAT

(i). GROWTH TAKES PLACE IN SECTORS IN WHICH THE POOR WORK (ii). GROWTH SHOULD OCCUR IN BACKWARD AREAS WHERE THE POOR LIVE (iii). GROWTH SHOULD USE THE FACTORS OF PRODUCTION THAT THE POOR POSSESS AND ENHANCE THEIR CAPABILITIES (iv). GROWTH MUST KEEP PRICES OF GOODS AND SERVICES CONSUMED BY THE POOR, LIKE FOOD, RELATIVELY LOW

 SHARP RISE IN GLOBAL OIL AND FOOD PRICES  FLUCTUATIONS IN GROWTH OF THE WORLD ECONOMY HAVE AFFECTED

REGION’S EXPORTS (FOR EXAMPLE, IN 2009)

 FOLLOWING WITHDRAWAL OF TEXTILE QUOTAS, SHARE IN GLOBAL EXPORTS

OF SOUTH ASIA HAS INCREASED BY ONLY 2 PERCENTAGE POINTS

 ODA IS BELOW 1% OF GNI OF SOUTH ASIA, 60% fall in 2012  PRIVATE CAPITAL FLOWS TO REGION ONLY 10% OF GLOBAL TOTAL, 63% fall in

2012

 VOLATILITY IN SHORT‐TERM PRIVATE CAPITAL INFLOWS  HOME REMITTANCES HAVE FLATTENED OUT RECENTLY

OVERALL, DISAPPOINTMENT ABOUT THE EXTENT OF COMMITMENT OF DEVELOPED COUNTRIES TO MDG 8 ON GLOBAL PARTNERSHIP FOR DEVELOPMENT. ONLY 5 COUNTRIES HAVE MET ODA TARGET OF 0.7% OF GNI. GLOBAL SHORTFALL CUMULATIVELY IN RELATION TO TARGET OF $ 1.5 TRILLION SINCE 2000.

Source: OECD‐DAC, IMF, WTO, Country Economic Surveys

 EMBODIMENT OF THE PRINCIPLES OF THE UN CHARTER IN A

CONCRETE PROGRAM

 PROVIDED FRAMEWORK FOR INTERNATIONAL COOPERATION  PROMOTED INVOLVEMENT ALSO OF CSOs AND THE PRIVATE

SECTOR

 COMPELLED GOVERNMENTS TO INVESTING IN THE PEOPLE

AND INCREASED ACCOUNTABILITY OF PERFORMACE

 ENABLED FOCUS ON DEVELOPMENT OUTCOMES/RESULTS

RATHER THAN ON EXPENDITURE/INPUTS

 FEWER TARGETS*, WITH PRIMARY FOCUS ON ELIMINATION OF POVERTY

AND HUNGER

 NEED FOR EXPLICIT FOCUS ON REDUCTION IN INEQUALITY  IDENTIFICATION OF EMERGING RISKS DUE TO: ~ GLOBAL ECONOMIC SLOWDOWN ~ HIGH OIL AND FOOD PRICES ~ GLOBAL CLIMATE CHANGE  UNDERSCORING DEMOCRATIC GOVERNANCE  SPECIAL EMPHASIS ON LDCs, CONFLICT‐AFFECTED AND FRAGILE

COUNTRIES

 STRONGER FOCUS ON HEALTH‐RELATED INTERVENTIONS  RECOGNITION OF NEED FOR INVESTMENT IN INFRASTRUCTURE,

ESPECIALLY ENERGY AND WATER

* CURRENTLY 48 TARGETS

 ‘LOCALISATION’: MORE OWNERSHIP BY NATIONAL STAKEHOLDERS  SETTING OF MORE REALISTIC TARGETS  ‘LOOKING BEYOND AVERAGES’: IDENTIFICATION OF AND TARGETING

SPECIAL GROUPS

 PROMOTING SOUTH‐SOUTH COOPERATION: EMERGING DONORS,

STRONGER LINKAGES OF REGIONAL TRADE AND INVESTMENT, STRENGTHENING OF REGIONAL FINANCIAL INSTITUTIONS

 GREATER INVOLVEMENT OF LARGE INTERNATIONAL NGOs AND

FOUNDATIONS

 G‐20 SHOULD NOT BE SEEN AS A PROCESS OF EXCLUSION OF THE REST OF

G‐77

 CONVENE GLOBAL CONFERENCE ON ‘MDGs +10’ TO DISCUSS

DEVELOPMENT GOALS UPTO 2025