Globalization and achieving lasting development<\/p>\n
Alan P. Larson, Jakarta<\/p>\n
The World Bank and International Monetary Fund hold their
\nannual meetings on Oct. 2-3. As that gathering discusses
\nglobalization and development, I hope it will be with a clear
\nrecognition that it is private enterprise that is the basic
\nengine to both.<\/p>\n
The United States' approach to development reflects our
\nnation's basic values, a generous heart combined with a hard-
\nheaded demand for results. We see private initiative from
\nbusinesses and families as prime movers in any nation's
\nadvancement and welcome the fact that entrepreneurship, personal
\nresponsibility and property rights are taking their rightful
\nplace in the venerable body of development ideals. As the UN's
\nrecent report Unleashing Entrepreneurship makes clear, private
\nsector resources can make powerful contributions to development.<\/p>\n
Take remittances -- the hard-earned money that foreign workers
\nsend back to their families in developing countries. These amount
\nto roughly US$90 billion annually. Beyond helping families put
\nfood on their tables, this money goes a long way toward helping
\neveryday people build houses, start businesses, and even hire
\nworkers.<\/p>\n
Another example is foreign direct investment. A flow that the
\nInstitute of International Finance forecast at $225 billion this
\nyear, it is an especially powerful development tool because it
\nspurs economic growth and development by transferring knowledge
\nand technology, creating jobs, boosting productivity, enhancing
\ncompetitiveness and stimulating entrepreneurship.<\/p>\n
Domestic savings in the developing world is a far greater
\nsource of development finance, estimated at more than $2
\ntrillion a year. As countries put in place policies and
\ninstitutions that encourage domestic investment, these savings
\ncan support rising income, productivity, and jobs.<\/p>\n
And then there is trade. Time and again, trade has proven to
\nbe a powerful engine for progress in emerging economies. Time and
\nagain, countries that embrace trade find themselves moving onto a
\nfaster growth path and converging with the developed world.<\/p>\n
And also, time and again the United States has been at the
\ncenter of the effort to promote free and unfettered trade. The
\nU.S. is the top importer of goods from developing countries,
\nimporting $680 billion last year -- more than 10 times greater
\nthan all ODA to developing countries from all donors.<\/p>\n
But there is still more work to be done. A World Bank study
\nestimates that a successful conclusion of the Doha negotiations
\ncould lift more than 140 million people out of poverty and add
\n$350 billion annually to developing country incomes. The July
\nGeneva WTO framework agreement presents a unique opportunity to
\nmove ahead on a final package that will open markets for trade --
\nespecially in agriculture -- around the world. For this reason
\nall institutions and governments must press ahead to a successful
\nconclusion of the Doha round.<\/p>\n
At the March 2002 UN Conference on Financing for Development
\nin Monterrey, Mexico, world leaders recognized that the best hope
\nfor the developing world to achieve its potential is for each
\ncountry to take primary responsibility for its own development.
\nThe Millennium Challenge Account or MCA, is the American response
\nto this challenge. The MCA provides grants to countries that
\ngovern justly, invest in their people, and promote economic
\nfreedom to encourage all developing countries to adopt sound
\neconomic and social policies.<\/p>\n
The MCA is a common sense idea that draws on lessons learned
\nabout development over the past 50 years. In its five months of
\noperation, the MCA has selected 16 partner countries who are
\nreaching out to their citizens and putting forward innovative
\nideas for how to overcome their greatest growth and development
\nhurdles.<\/p>\n
With strong bipartisan support, Congress authorized the
\nMillennium Challenge Corporation (MCC) to administer the MCA and
\nprovided $1 billion in initial funding for FY04. The President
\nhas requested $2.5 billion for the MCA for the coming fiscal
\nyear.<\/p>\n
From 2006 on, the President intends to ask Congress to
\nappropriate it $5 billion annually -- an amount that is in
\naddition to an assistance budget that was already 50 percent
\nabove its 2001 level in 2003. MCA, combined with the President's
\nHIV\/AIDS initiative -- committing $15 billion over five years --
\nand growth in our traditional development assistance budget puts
\nus on track to increase our overall assistance levels in 2006 by
\n75 percent.<\/p>\n
Debt reduction for the poorest countries is a priority of our
\ndevelopment strategy. Under the enhanced Heavily Indebted Poor
\nCountries (HIPC) initiative, 27 countries have had their debt
\nburden reduced by two thirds -- some $32 billion in present value
\nterms, enabling them to increase their spending on poverty
\nreduction. Moreover, the United States goes beyond the generous
\nparameters of this multilateral program and forgives 100 percent
\nof the debt these countries owe us.<\/p>\n
But despite all this progress, we recognize that some
\ncountries still face unsustainable debt burdens. That's why G-8
\nleaders at Sea Island this summer agreed to work toward extending
\nthe HIPC initiative for two more years and to consider other
\nmeasures to help the poorest countries address their debt
\nsustainability.<\/p>\n
Eradicating poverty is an expression of our nation's deep
\nhumanitarian impulse. It reflects a recognition that our own
\nwell-being depends on the well-being of fellow human beings.
\nBringing all of the world's poor into an expanding circle of
\nopportunity is vital to raising hope, improving peoples' lives,
\nand creating a more secure, democratic, and prosperous world. Do
\nthis, and we will have made lasting mark toward turning the
\ncorner on poverty.<\/p>\n
The writer is Under U.S. Secretary of State for Economic,
\nBusiness and Agricultural Affairs.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/globalization-and-achieving-lasting-development-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}