Friday, 30 December 2011

A year of blogging: My favourite blog posts from 2011

By John Humphrey

As 2011 draws to a close, I thought I’d look back on a year of blogging from here in the Globalisation Team at IDS.

Here are my top 3 blog posts from 2011:
  • 2011 has seen much debate on the issue of innovative financing for development – as public sector budgets are squeezed and global financial systems are in a state of uncertainty. My former colleague Neil McCulloch blogged about his research on the Financial Transaction Tax (FTT), with Do £20 notes get left on the pavement? which could provide a possible solution. It’ll be interesting to see going forward how the FTT debate progresses in 2012: perhaps an FTT is no longer seen as a source of financing development in the global South, but instead viewed as a revenue stream for plugging deficits in developed countries?
  • Food has been one of the major themes in development this year – sparked by volatility in food prices, popular uprisings across the Arab world, and famine in the Horn of Africa. 2011 was the year of Oxfam’s biggest ever campaign on food (GROW) and also the year that we at IDS held seminars looking at the role of business in issues of food, nutrition and development. My post on 'The food conundrum: Can small farmers and big business work together to solve the world food crisis?' reflects one of the toughest questions: who will solve the food crisis?
  • Finally, an ongoing issue for those of us that work in development is to fully understand what the public think about issues of aid and global poverty – this is going to become even more crucial in 2012 as public sector cuts begin to bite here in the UK. After all, it’s the public that so generously support development NGOs at times of crisis and disaster. And politicians who decide where government aid should be spent do pay attention to what voters think. My colleague Spencer Henson’s blog posts on public attitudes towards development, based on his research with the UK Public Opinion Monitor are always fascinating: his latest one is ‘Are the UK Public more supportive of aid than we thought?’.
We re-launched our blog in February this year, and have thoroughly enjoyed expressing our views, sharing ideas on new research, and hearing your comments. We hope you’ve also found the posts interesting and useful for your own work – let us know which are your favourites.

Best wishes for the New Year, and do visit again for more posts in 2012.

Wednesday, 21 December 2011

Being sold development at Christmas

By Spencer Henson

At this time of year more than any other, UK consumers are bombarded with efforts to sell them development. Buy a goat in Kenya for your loved one, spend a little extra on Christmas cards where a certain (usually undisclosed) portion goes to a charity working with poor people in the ‘developing world’, give a handicraft made by poor women in rural India, and so on. Fundraisers in international development NGOs recognise that such efforts are effective at getting UK consumers to part with their money. That is why they use them….especially during the ‘season of good will’. But what do they tell us about how ‘the person on the street’ relates to international development?

The recent book Poor Economics by Abhijit Banerjee and Esther Duflo reminded me of some research at the University of Pennsylvania in the mid-2000s. Students were given $5 and then showed one of two leaflets asking them to make a donation to Save the Children. The first leaflet provided factual information about the scale of famine in various countries of sub-Saharan Africa. The aim was to communicate the sheer magnitude of the food insecurity situation across the continent, and thus the imperative for people in the rich world ‘to give’. The second leaflet described a named person (“Rokia”, a seven-year old girl from Mali). The aim was to put across the level of hardship this individual was facing and the impact that a donation could make on such a person.

You can guess which of these two messages was most effective at getting students to donate. Unsurprisingly, the average donation to change Rokia’s life was more than double that from students who were offered the chance to ‘help the masses’. 

Various things may be at work here. Certainly, it is easy for people to feel overwhelmed by the magnitude of the millions in need ‘in Africa’. Perhaps more important, however, is the way in which we all tend to relate to individuals. That is why efforts to sell us development at Christmas often come with the smiling face of a boy or girl…..that YOU can help.

Much ‘good’ work’ may be funded from efforts to sell us development at Christmas. However, there are two critical problems with this model of engagement of international development NGOs with the public.
  • First, it is very much based on the notion of benevolence of the (powerful) rich towards the (powerless) poor. UK consumers can decide how to spend their money at Christmas whereas the poor have little money to spend on anything. Further, as a wealthy donor the consumer can decide who is ‘deserving’ of their charity, however they might judge this.
  • Second, and more importantly, efforts to sell development do little or nothing to challenge the very reasons that people are poor…and the need for benevolence by the rich in the first place. Thus, how is it that such global inequality exists, and what can be done about it? The act of buying a goat, a charity Christmas card or a handicraft fails to challenge the status quo. Some would even argue that buying development perpetuates the very systems that make people poor in the first place.

Tuesday, 20 December 2011

How regulations and standards affect sub-Saharan African countries’ participation in global agri-food trade

By Spencer Henson

A recent article in Trade Negotiations Insights highlights the importance of sanitary and phytosanitary (SPS) regulations and standards for the participation of sub-Saharan African countries in global agri-food trade. This article provides a timely reminder that the ability of poorer countries to diversify and add value to their agri-food exports hinges on their ability to comply with the food safety and plant and animal health requirements in export markets. Whilst compliance with stricter SPS regulations and standards can undoubtedly act as a barrier to trade, most notably where the associated costs undermine the competitiveness of countries with weaker capacity, compliance can also be the basis of market positioning and competitive gain. The act of compliance with food safety and plant and animal health controls in international trade can also act to enliven processes of upgrading in controls directed at domestic markets. This suggests a rather complex interplay of costs and benefits for developing countries pondering improvements in SPS compliance capacity.

There is a widespread recognition that the increasing importance of SPS regulations and standards in global trade contrasts with the declining role of traditional trade restrictions such as tariffs. There are frequent and maybe irresistible accusations (or at least suspicions) that SPS regulations and standards represent the new way in which countries protect their domestic markets against import competition. However, there is limited hard evidence to support this claim. It is important to recognise that, unlike tariffs, food safety and plant and animal health controls can bring about significant benefits in terms of public health and agricultural productivity, and also through increased consumer demand. Furthermore, countries have a legitimate right to protect their citizens, even where the standards and regulations they enact inflict pain on poorer parts of the world.

Of course, all should be done to minimise the adverse effects of SPS regulations and standards on the countries of sub-Saharan Africa. For example, it is legitimate for SPS requirements to be adjusted where comparable but different controls that reflect local conditions can be shown to provide an equivalent level of protection. The history of such equivalence agreements to date, however, does not offer much hope. Rather, the emphasis must inevitably be on building the SPS compliance capacity of the countries of sub-Saharan Africa, both to enhance trade performance and to promote the welfare of their citizens and productivity of their agri-food sectors. The article in Trade Negotiations Insights provides some useful ideas in this respect, including a number of areas where countries can collaborate in order to share information and capacities. However, whilst regional initiatives are effective at stretching the inevitably limited resources available for SPS capacity-building, hard decisions still need to be taken in order to prioritise the ‘shopping list’ of needs presented in the article. Recent work by the Standards and Trade Development Facility (STDF) in developing a coherent and transparent framework for establishing priorities can play a key role in this regard.

The article puts significant emphasis on enhancing the role of the countries of sub-Saharan Africa in the setting of SPS standards, presumably through Codex Alimentarius, OIE and the IPPC. The greater inclusiveness of these institutions is essential, not only for the interests of poorer countries but also to the continued relevance of international standards. Participation of sub-Saharan African countries in the promulgation of international standards is not, however, a panacea to the cure of ‘all ills’. Even if the ‘voice’ of developing countries in general (and the countries of sub-Saharan Africa in particular) were to be heard more effectively, SPS compliance would still be a problem. To be relevant (and to be used), international standards must reflect the needs of all countries, including those that are wealthy. At the same time, the private sector is wading into the standards landscape, such that some argue ‘public’ international standards are being increasingly sidelined. At the heart of the issues faced by developing countries is their incapacity relating to food safety and plant and animal health.

It is refreshing that the article puts considerable focus on the role of SPS regulations and standards at the regional level. The need for countries in sub-Saharan Africa to pool capacities in order to meet the compliance challenges posed by industrialised country markets has been highlighted above. Over time, however, SPS regulations and standards are likely (or at least it is assumed) to become a more pertinent issue in south-south trade, highlighting the need for harmonisation within sub-Saharan Africa. The Regional Economic Communities (RECs) potentially have a major role to play in this regard. Relatively little is known, however, about the role of SPS regulations and standards within regional trade in sub-Saharan Africa today, and how these are evolving over time. Work along these lines is essential if we are to predict (and plan for) the evolving impact of SPS regulations and standards into the future. Whilst IDS is doing some work on this issue with UNIDO, much more analysis is needed.

It is important to remain mindful of the considerable challenges faced by the countries of sub-Saharan Africa in the face of seemingly ever stricter SPS regulations and standards. Many of these issues, however, are much more complex than appears ‘at first sight’, belying the effectiveness of ‘quick fixes’.

Monday, 12 December 2011

Good-bye to the future

By Hubert Schmitz

For an Anglo-German (I have dual nationality – British and German) it is heartbreaking to see how the UK Government is de-coupling from Europe. There is nothing wrong in defending the national interest. But what is the national interest? Our Prime Minister equates it with the interests of the financial sector, clustered in the City of London. This is deeply worrying.

Continental European Governments have come round in favour of the financial transaction tax in order to slow down speculative financial flows. IDS research has shown that such a tax can be effective. But the UK government regards it as against the national interest. Continental European governments want to exert more control over the financial sector. This is never easy but at the time of the last election even the Tories proclaimed that this was needed. Now it is judged against the national interest.  

An even greater tragedy unfolds if we look at the wider picture and reflect on the position of the UK and Europe in the world. I have just come back from research trips to China and Vietnam. The pace of change and transformation in East Asia is visible and breathtaking. It has been for some time and seems set to continue. The global power shift is clearest in industrial production but is beginning to extend to industrial innovation.  And most interestingly, it is extending to the green economy. China is ramping up public and private investment in wind power, solar power and electric vehicles. Meanwhile the UK and most of Europe is scaling back investment in the industries of the future.

The UK decision over whether and how to collaborate with Europe needs to be seen against this bigger picture. A well-functioning European financial and industrial system can find a way of competing and cooperating with China.  We have shown this in a recent study on the European and Chinese wind power industry. A mal-functioning European financial and industrial system means that European governments, including the UK governments, will be limited to administering decline.  The national British interest would have been served by working with continental European government on ways of reforming the financial sector so that it supports rather than undermines the real economy.  It is a hard thing to do and the Prime Minister turning his back on Europe makes it even harder.

Wednesday, 7 December 2011

Beyond Durban: On track towards a +4 degrees C world

By Dirk Willenbockel

While all eyes are fixated on the future of Euroland and the looming global depression, the UN Climate Summit in Durban has entered into its decisive final phase and stumbles on to pre-programmed failure.
  • Will Durban drive the final nail in the coffin of the Kyoto process and give up on a new global deal with legally binding emission reduction commitments altogether?
  • Or will the negotiations at least lead to some “road map” to a comprehensive post-Kyoto deal that may eventually enter into force by 2020?
  • Or will the decision simply be postponed yet again – as seems most likely at this stage?
What seems clear is that none of these conceivable outcomes leads to an emission path consistent with the agreed goal to limit the average global temperature rise to 2o C above pre-industrial levels. Climate science is adamant that annual global CO2 emissions will have to peak by 2020 at the latest and need to drop steadily in subsequent decades in order to maintain a reasonable chance to achieve this aim.

The International Energy Agency estimates that about 80 percent of the power stations likely to be in use in 2020 are either already built or under construction. Most of these are fossil fuel powered and will continue to pour out carbon for decades. This means that a large fraction of the global energy-related emissions permissible under a +2o C scenario are already locked in by the existing infrastructure. The implication is that the door to achieving the required emission cuts at a manageable cost is rapidly closing. Delaying action is a false economy.

A recent contribution to the scientific journal Nature points out that the hope to maintain the 2o aim if decisive mitigation action is delayed further now “is equivalent to racing towards a cliff and hoping to stop just before it”.

With no second commitment period under the Kyoto Protocol and no binding post-Kyoto deal covering the major emitters in sight before the end of the decade, we are left with the voluntary pledges for emission reductions submitted by developed and developing countries under the Copenhagen Accord. It has indeed been suggested – notably by the former UK chief scientific adviser David King – that a voluntary bottom-up pledge-and-review process would be a realistic and promising way forward. However, UNEP research shows that the voluntary pledges submitted are pathetically inadequate to meet the +2o C target.

UK Climate Secretary Chris Huhne’s verdict on King’s suggestion:
"Sidelining the push for a legally binding deal on curbing emissions in favour of a voluntary approach is about as useful for the climate as a chocolate tea pot”.
Meanwhile, greenhouse gas emissions reached a new record high last year, and scientists are getting serious about contemplating development prospects in a 4o C world. A whole recent issue of the Philosophical Transactions of the Royal Society is devoted to the topic. I have reached my word limit here, but recommend the paper on sub-Saharan Africa in that issue.

Tuesday, 6 December 2011

Diamonds, violence and tyranny: NGO Global Witness leaves the Kimberley Process

By Vivienne Benson

There was no doubt a degree of scepticism from Mike Davis from Global Witness when he spoke about the Kimberley Process at the beginning of our Conflicting Interests: Business and Development Seminar Series in November. So, yesterday’s announcement that the international NGO has decided to leave the diamond certification scheme, which was originally established to stop the trade in blood diamonds, is not altogether surprising.

Mike Davis cited several reasons why the scheme has been unsuccessful in his seminar:
  • A myth has emerged that the Kimberley Process solved conflicts such as those in Liberia and Sierra Leone – the reality is that the process only got underway after the conflicts had ended.
  • The only controlled part of the diamond trade is from the moment the diamond is exported from the producer company to when it is imported at the other end.
  • There are no clear standards for supply chain control or due diligence, which is a huge weakness –the industry relies on the State to control the flow of the diamond’s certification, but this creates a problem because often the State is not able (or not willing) to do this properly.
Charmaine Gooch, Founding Director of Global Witness further argued this point yesterday*, on the role of industry:
‘The diamond industry must finally take responsibility for its supply chains and prove that the stones it sells are clean.’ She continued, ‘they should be required to demonstrate that the diamonds it sells are not fuelling abuses – by complying with international standards on minerals supply chain controls, including independent third party audits and regular public disclosure. Governments must show leadership by putting these standards into law.’
So how should businesses operate in areas of conflict?
This sentiment has been repeatedly echoed throughout the seminar series – with several references to John Ruggie, UN Special Representative on Business and Human Rights who within the UN 'Protect, Respect and Remedy' Framework in 2009 laid out guiding principles for businesses and states operating in areas of conflict, in particular:
  • Because the risk of gross human rights abuses is heightened in conflict-affected areas, States should help ensure that business operating in those contexts are not involved with such abuses.
  • Some operating environments, such as conflict-affected areas, may increase the risks of enterprises being complicit in gross human rights abuses committed by other actors.
This reiterates a key theme from the seminar series, that the State and industry cannot operate separately, or in place of each other, particularly as their interests are inherently different. Businesses should not be expected to take over the State role, but they should adhere to international due diligence standards and always consider their impact on the communities in which they operate.

* Global Witness (2011), Global Witness leaves Kimberley Process, calls for diamond trade to be held accountable, http://www.globalwitness.org/library/global-witness-leaves-kimberley-process-calls-diamond-trade-be-held-accountable, (accessed on 5 December 2011)

Friday, 2 December 2011

Can philanthropies lead us to an economics of wellbeing?

By Noshua Watson

A team from IDS recently led the Bellagio Summit in Italy, as part of the Bellagio Initiative on the Future of Philanthropy and Development in the Pursuit of Human Wellbeing, funded by the Rockefeller Foundation. Philanthropies have big names, but relatively small pockets. Aid flows, let alone foreign direct investment flows and remittances, are far greater than philanthropic funding for international development. So what could philanthropies possibly do to ease, fix or change the effects of globalisation on development?

From the Bellagio Initiative and Summit, there seem to be three ways philanthropic foundations can influence globalisation:
  1. Engaging with the processes of globalisation
  2. Tackling the inequities of globalisation head on
  3. Focusing both more AND less on outcomes.
Philanthropies need to be more politically engaged by supporting organisations that take direct action and also take advantage of their independence by taking more risks and experimenting more.  Of course, philanthropies do try to address inequities and meet communities’ needs, but they also need to explore how they are part of a system that generates those very inequities through lack of accountability, how they manage and spend their funds or how they incorporate feedback and learning.  Philanthropies are also in a situation where they are trying to better measure and manage their resources, but not focus on outcomes so much that they don’t experiment or lose sight of the long-run benefits. There is much to be learned from the reports on the series of Global Dialogue meetings, commissioned research and the Bellagio Summit.

If we are really honest, what would it mean for globalisation if, like the Bellagio Initiative, we frame development in terms of wellbeing? Wellbeing is a broader conception of development than economic growth. We currently describe globalisation largely in terms of economic institutions, flows, patterns and outcomes. But what if we looked at what globalisation means for wellbeing, we would certainly advocate different policies. Given that the OECD and national governments are beginning to adopt the concept, maybe economists should add this to our bag of tricks.