Rethinking development - pain or gain?

Rethinking development - pain or gain?

Yanuar Nugroho, Director, The Business Watch Indonesia, Surakarta,
yanuar-n@unisosdem.org

Over the past 30 years, 2 billion people were added to the
world's population, mostly in developing countries registering
substantial gains in human welfare that accompanied their growth.
There was a halving of the infant mortality rate in low and
middle income countries, from 11 percent of live births to 6
percent, as well as a drop in illiteracy among adults from 47 to
25 percent, and for women in particular, from 57 to 32 percent.
Real per capita income (in population-weighted 1995 U.S. dollars)
rose from $989 in 1980 to $1,354 in 2000.

But, some social and environmental trends associated with past
development strategies in most countries are not sustainable.
There are still 1.2 billion people living on less than $1 a day;
despite the success in reducing this number by at least 200
million in the past two decades, this population grew
dramatically.

The average income in the richest 20 countries is 37 times
that in the poorest 20, a ratio that has doubled in the past 40
years, mainly because of lack of growth in the poorest countries.
According to the World Bank report in 2002, more than 1 billion
people in low- and middle-income countries lack access to safe
water, and 2 billion are without adequate sanitation, subjecting
them to avoidable disease and premature death.

After globalization, development is the word that may be used
as a common denominator for the world's growth and progress. Yet,
in Indonesia, it is indeed difficult to gain a perspective on
development, particularly when the nation is grappling with so
many complications in its transition from a centralized,
authoritarian government to a democratic and decentralized
administration.

Many are fixated on the daily turmoil of events, rallies and
emotionally charged political debates. Thus, while development
has been focused to achieve some progress in reducing poverty,
the inching forward has been painfully slow and uneven.

Surely overall policies in development would have an end
objective -- people. But, to what extent do the people benefit
from such policies?

The above table shows ironically that while fuel prices have
increased from 114 percent (kerosene) to 244 percent (diesel)
since the crisis to 2002, the price of rice only rose 31 percent.
The consequences are easily predictable -- life becomes more
difficult, especially for most of those who are remote from the
centrum and depend more for their livelihood on agriculture.

People must be at the center of development, not only in the
traditional view that people are the engine of change, but also
in the less-traditional sense of development that puts people
first.

People are the critical factor in development, first in terms
of their numbers and the social, health, economic and
environmental consequences of their actions; and secondly in
terms of the decisions they make on domestic issues and the way
they live their lives. People-centered development also means
full community participation at both decision-making and
implementation levels.

Poverty remains intractable despite economic growth in many
countries. This partly reflects the problem of income inequality
within countries. Income inequality in turn reflects inequality
of opportunity.

What is the cause? At least in part, the still tragically
unmet need for equitable and inclusive investment in human
capital -- e.g. investment in people through better education and
heath care-and for wider access to the infrastructure and capital
needed to broaden the basis of opportunity.

Here lies a two-way relationship between poverty and growth.
Growth might be a necessary, but not a sufficient condition for
poverty reduction, but persistent poverty and inequality can
reduce growth rates.

The writer is also a lecturer of the Sahid University in
Surakarta and a researcher at Uni Sosial Demokrat, Jakarta.