Sustainable Development and Good Governance

Development is primarily a domestic responsibility
Positive contribution to development
General lessons for sustainable development
The driving force behind development assistance

Development is primarily a domestic responsibility

The responsibility for sustainable development at the national level – that is, for the complex mosaic made up of economic, social, political, cultural and ecological components that must be put together under a specific set of conditions – lies first and foremost with the countries concerned.

Any improvement in the people's quality of life has to begin and be maintained “at home”. Of course, a favorable economic environment and fair conditions of competition and trade will make a country's efforts to that end easier, but “outside” players can only support and facilitate sustainable development – they cannot replace a country's own endeavors.

Its economic, social and political fabric is of decisive importance for a country's success in developing itself. That fabric depends, above all, on the nature of the development policy that the country has chosen to follow as well as on the quality of its government and authorities.

Positive contribution to development

Various developing countries which are quite comparable in terms of their natural resources (land, water, arable soil, minerals, climate etc.) and social structures have over the past thirty years shown strikingly differing records of economic and social progress.

Measured by the criteria of child mortality, life expectancy and literacy – the key indicators of quality of life – some countries have made considerably greater progress than others, even though they all operate in the same world economic environment and have comparable colonial pasts.

This shows that historical burdens, adverse international economic conditions such as falling raw material prices or other external factors, though important, do not have a decisive impact on the achievement of a higher quality of life in the countries concerned. In light of this fact, coupled with the uneasiness caused by irresponsible rulers in a number of countries, the matter of “governance” has come to the forefront of the debate over development policy.

“Governance” is the art of public leadership. There are three distinct dimensions of governance:

  • the form of political regime;
  • the process by which authority is exercised in the management of a country's economic and social resources; and
  • the capacity of governments to design, formulate, and implement policies and discharge functions.

The criteria that constitute good governance have been drawn from these three dimensions, and include:

  • legitimacy of government (degree of “democratization”),
  • accountability of political and official elements of government (media freedom, transparency of decision-making, accountability mechanisms),
  • competence of governments to formulate policies and deliver services,
  • respect for human rights and rule of law (individual and group rights and security, framework for economic and social activity, participation).

General lessons for sustainable development

Whatever the natural endowment of a country may be, human development worthy of the name cannot take place where bloody civil wars and desperate brawls over the allocation of scarce resources are raging and where despots bleed their countries white to enrich themselves and arm their minions.

It is impossible for an economy to flourish where the “might of the sword” rather than free and fair elections decides who shall rule. A government that shoulders responsibility for sustainable development and ensures its people have security, solidarity, order and continuity, creates an environment in which its citizens can exercise their productive, political and cultural abilities.

Strategies for overcoming social privation and economic underdevelopment are like a complicated puzzle. Various pieces of the puzzle have to be sifted through and put together to give an overall picture that corresponds to the specific conditions within a country. Yet, despite the great diversity of existing economic and social settings, there are a few general lessons for successful sustainable development that can be drawn from the experience amassed over the past forty years. At the macro-level, the following policies and measures have proved effective:

A sound economic and financial policy designed to forestall high inflation rates or overvalued currencies as well as limiting government activities to the tasks that the market cannot handle results in economic growth based on allocation mechanisms in conformity with the market economy.

Economic growth is a critical but not the sole requirement for success in the fight against poverty. It is equally important to have a social policy that places particular emphasis on meeting basic human needs. Education, training and extension services as well as availability of credit foster self-reliance and initiative in people of all segments of society.

A further component is a social climate in which the door to full personal development is open to everyone – regardless of gender, race, socio-cultural background or other differences. Where a socio-economic ambiance of this quality has been put into effect it has led to impressive economic success from which the lowest income groups have also benefited, since government expenditures in the education and social welfare sectors could be financed from it. Such countries have also been more successful than others with respect to the ecological sustainability of their development policy.

Where good governance has been lacking progress – be it economic, social or ecological – has not taken place. On the contrary, in most cases stagnation at an already low level or even reversals have been the result. A number of sub-Saharan countries can serve as warnings in that regard.

Poor governance generates a social environment detrimental to development. In such cases external aid, whatever the amount or intention, has little effect. Indeed, it can even be harmful if it contributes to prolonging an undesirable state of affairs.

Good governance” puts people into the center of development. “Where people grow, profits grow”: this well-tried business rule is applicable to development policy as well.

Where there is long-term investment in people's health and education, where both men and women, regardless of their social status, have access to the necessary means of production, extension and credits, they can take their fate in their own hands and make use of opportunities to improve their quality of life. A national development policy of this caliber can then be successfully supported through international cooperation.

The driving force behind development assistance

By “development assistance” – or in more modern terms, “financial and technical development cooperation” – we understand a range of activities of various partners that promote the participation of the developing countries in the world economy, and that help people to overcome poverty and share in their country's development.

Development cooperation can take on various forms: financial or technical support for projects and programs, provision of capital or infrastructural goods or of credit on easier terms. Humanitarian aid is the aspect of development cooperation directed towards bringing speedy relief during emergencies, such as those caused by natural disasters or war.

Development assistance is extended out of all kinds of motives, from well-considered self-interest to a sincerely felt moral duty. Until the end of the East-West conflict, geostrategic considerations also played an important role. They no longer do, leaving both an opportunity and a problem for development cooperation.

The opportunity consists in the possibility of allotting funds solely according to rational criteria such as “good governance”. Without such a guideline an effective and efficient utilization of the available resources will not ensue. In times of financial and budgetary belt-tightening as well as mounting social challenges in industrialized countries development cooperation must also accept certain constraints. This situation compels cautious decision-making and efficient performance. It means heaving to do more for the poverty-stricken in developing countries with fewer means available.

Only quality management will ensure that development assistance continues to enjoy the high regard it now has in industrialized countries. This it would quickly lose were there a fall-off in quality or a waste of funds.

The situation is not without risks. If, beset by their own problems, the industrialized countries do not manage to see beyond their own noses, they will fail to realize that the socio-economic development of poor countries is in their own best interest. This would not only endanger global peace and progress, it would also lead to adverse repercussions on the economies of industrialized countries.

Growing poverty in developing countries would also intensify the pressure on their people to emigrate, again with complex consequences for all industrialized countries. A cutback in funding would coincide with ongoing high rates of population growth and most likely with dwindling environmental resources as well.

If the problems remain the same or worsen, and the funds made available to solve them stagnate or shrink, then new sources of funding must be found. Even more importantly, every possible way of improving quality, effectiveness and efficiency has to be fully utilized. This applies across the board, but most particularly to those engaged in development cooperation.

Source: Novartis Foundation - Sustainable Development Programme
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