From Growth Models to Development Outcomes: An ACP 1 Response to the Sustainable Development Solutions Network Report 2

From Growth Models to Development Outcomes: An ACP 1 Response to the Sustainable Development Solutions Network Report 2 "...sustainable development is the result of the sum of the actions of all people it is important that stakeholders can participate in decision making at all levels. All stakeholders must commit to supporting the SDGs with transparency, accountability, participation, responsiveness to public needs, and without corruption. Where necessary, rules for international trade, finance, taxation, business accounting, and intellectual property need to be reformed to become consistent with achieving the SDGs. Governments must commit to good governance by respecting human rights and fundamental freedoms; upholding the rule of law; ensuring effective participation...and by promoting transparent, accountable, and effective institutions. United Nations Solutions for Sustainable Development Network (SDSN) Report for the Secretary General, June 2013 Summary From a scientific lens the Sustainable Development Solutions Network (SDSN) Report offers some new perspectives on development. Proposals on accountability models, shared responsibility, greater responsibility over global public goods and a more equal world are welcome. So are the proposals to include governance as a fourth Pillar on Sustainable Development and the recognition that Peace and Security are the most important public goods. The Report s highly ambitious attempt to push for a world where we are all have equal spaces through what it calls Sustainable Development Path (SDP) is commendable. Proposals on new measurements of poverty such as Relative Poverty and social well being are worth considering as we move away from traditional GDP Measurements. The SDSN s apocalyptic view of what a Business As Usual trajectory will do to the world, although argued through the lens of a flawed model, is perhaps what the world needs to hear. 1 The Africa CSO Platform on Principled Partnership (ACP) works through focal points in 26 countries across Africa to promote statesociety relations through principled partnership and respectful dialogue among CSOs and with governments, with a primary focus on emerging democracies and Conflict Affected States. Secretariat: Fort Granite, Bishop Road Tel: Nairobi (+254-20) 2055003: Email info@africacsoplatform.org, website www.africacsoplatform.org. 1 A C P Analysi s of the S u s tai n a b l e D e v e l o p m e n t S o l u ti o n s Netw o r k

The SDSN Report has, however in our opinion, taken a scientific narrative that we believe render many of its proposed goals not just simple MDG additives but minimalist in a Post Millennium Declaration Agenda. It weakens many of the past United Nations and Secretary General s Reports 3. And so while we agree with the SDSN s call for voices of the people to be at the centre of the SDG Agenda we worry that this voice is largely missing from the Report. Caution: Poverty is Politics, not science Our key concern with the SDSN Report is its failure to appreciate what we all know-poverty as a sub set of Development is about power and resource distribution-both deeply political. Development is inherently and primarily about power balance, not about scientific models. It has never been about Philanthropy, moral obligation or helping those left behind. It cannot be achieved primarily by relying on tools such as science, technology and knowledge. The Human Development Report cautions that Poverty is an injustice that can and should be remedied by determined action. Good policymaking also requires a focus on enhancing social capacities, not just individual capabilities. 4 We therefore advise for caution in reading and interpreting this Report in that while Science and education may provide the pathways out of poverty, it is the political and moral decisions made by all of us that will eventually resolve the world s development challenges. Those who, by the action of those before them, have found themselves in positions of power and wealth should find it within their conscience to give up part of that power as was done to them. 1. Achievements of MDGs, Growth and End to Extreme Poverty We are worried that the SDSN Report has overplayed the achievements of the MDGs, giving too much credit to Business and AID. They have also given a false impression that the current trajectory, which they reject in other sections of the Report, is actually working! For example, while it is true that 1 billion people have been lifted out of extreme poverty, the SDSN Report does not tell us that 662 million of those figures represent only two countries-both of which have received little or no Aid, have strong controls on businesses, and did not follow the MDGs model-china 5 and Vietnam 6. Neither does the Report tell us that out of the 1 billion people that are out of the minimum $ 1.25 poverty line, a massive 662 million are from two countries only-china and Vietnam 7. In reality, according to the World Bank the number 8 of the World s poor outside East Asia has in fact increased! 3 Most curiously the United Nations and the rest of the Developed world have in the recent past come up with a new level of poverty-extreme Poverty. Poverty must be eradicated in all its form, and not reclassified just because it has become universal. 4 Read the full Report here http://hdr.undp.org/en/media/hdr_2013_en_complete.pdf 5 See the World Bank Report on China here http://www.worldbank.org/en/news/feature/2010/03/19/results-profile-china-povertyreduction 6 For details on Vietnam s Poverty Reduction Strategy go to http://web.worldbank.org/wbsite/external/countries/eastasiapacificext/vietnamextn/0,,contentmdk:22539306~pagepk: 1497618~piPK:217854~theSitePK:387565,00.html 7 For details on Vietnam s Poverty strategy see http://web.worldbank.org/wbsite/external/countries/eastasiapacificext/vietnamextn/0,,contentmdk:22539306~pagepk: 1497618~piPK:217854~theSitePK:387565,00.html 2 A C P Analysi s of the S u s tai n a b l e D e v e l o p m e n t S o l u ti o n s Netw o r k

The state of most of the world s poor, with exception of Rwanda, Ethiopia and most recently Malawi, has remained largely unchanged, and are in fact sliding backwards 9. The SDSN Report does not tell us that much of what we call development is debt induced growth. The report does not tell us, for example, that today s World Debt is 313% ($223.3Trillion) of Global GDP, and that emerging markets, which have been the largest contributors to poverty reduction numbers, have a debt burden of $ 66.3 Trillion, or 224% of their GDP 10. 2. Business AS Usual Vs SD Agenda We commend the SDSN for warning us of serious consequences if we continue with our current development trajectory. But we disagree with many of the apocalyptic scenarios painted by the SDSN, especially those that portray poverty as a failure of some poor countries rather than a global systems failure. We specifically reject the notion that vulnerable countries and regions are too poor, too remote, too conflict-ridden, too bereft of natural resources, and/or too burdened by other challenges to meet the goals for sustainable development on their own. Vulnerability, in our opinion is no longer about these issues-as we can see in Europe, North America, the Middle East and practically all corners of the world. 8 Read an analysis of the World s Poor according to the World Bank here http://www.networkideas.org/featart/jan2009/himanshu_epw.pdf 9 Report by the Brookings Institute, while attempting to celebrate poverty reduction, has in fact brought out the failures of traditional models of AID and Business. The Report is the subject of a June 2 Economist Lead story and strangely bears similar arguments in the High Level Panel Report released May 31 st 2013. You can read the Report here http://www.brookings.edu/~/media/research/files/reports/2013/04/ending%20extreme%20poverty%20chandy/the_final_countdo wn.pdf and a full presentation on China by Danny Quah of the London School of Economics at http://www2.lse.ac.uk/publicevents/pdf/20111011%20danny%20quah.pdf 10 See detailed Report and analysis here http://blogs.wsj.com/economics/2013/05/11/number-of-the-week-total-world-debt-loadat-313-of-gdp/ and also here http://data.worldbank.org/sites/default/files/ids-2013.pdf 3 A C P Analysi s of the S u s tai n a b l e D e v e l o p m e n t S o l u ti o n s Netw o r k

The Africa Progress Panel (APP) Report 2013 confirms that most of the poverty in regions such as Africa is linked to economic injustice, poor governance among all actors, tax evasion, weak global commitment to policing trade and other policies and practices that the APP Panel Chair Kofi Annan says are like taking food off the table for the poor 11 3. Proposed Goals and Normative concepts The Five shifts noted by the SDSN Report-feasibility of ending extreme poverty in all its forms, a drastically higher human impact on the physical Earth, rapid technological change, increasing inequality, and a growing diffusion and complexity of governance- are in our opinion not themselves apocalyptic enough to move the world away from Business as usual. In our opinion the shifts needed are not in the instruments, but in the power and politics of global development. We recommend a recognition of other shifts- growing citizen and society power, effects of instability and conflicts, increased human rights abuses, convergence of interests between Business and Governments, increased exploitation of resources and irresponsible consumption of natural resources-as those that should inform our development agenda. We agree that the world is in dire need of normative concepts for Sustainable Development Path. The five proposals by the SDSN-right to development for every country, human rights and social inclusion, convergence of living standards across countries, and shared responsibilities and opportunities are a welcome foundation. But the world is not looking for convergence of living standards, but that their governments manage their resources well and allow them the space to develop and tap into their potential. We support the normative concepts proposed by the SDSN-the right to development for every country; human Rights and social inclusion; convergence of living standards across countries; and shared responsibilities and opportunities. But we call for these rights and convergence be bestowed on society, not countries. In seeking to merely update the MDGs and the Millennium Declaration, the SDSN has ignored significant transformational shifts that render many of the MDG irrelevant. In our view the Millennium declaration needed implementation in full, not updating. The MDGs, on the other hand, are primarily about one part of the world helping the other rather than collectively working for a more equitable, responsible and just worldthe primary root causes of poverty. We find many of the goals minimalist, un-ambitious and of little inspiration to the world today. While they are indeed an update of the MDGs, they face the risk of weakening many gains outlined in the Millennium Declaration. We equally agree with the SDSN Report that the MDGs are not enough. But sadly the report proposes that we should continue with what we have started! 11 The full Report can be accessed here http://africaprogresspanel.org/en/publications/africa-progress-report-2013/ 4 A C P Analysi s of the S u s tai n a b l e D e v e l o p m e n t S o l u ti o n s Netw o r k

The SDSN Report places too much faith in Education, Science and Technology as the drivers of development over the next few decades. While we agree that these are needed in our development happens through REAL changes in REAL Lives by REAL People. No tool can trigger changes in character, behavior and attitudes. Businesses, politicians and society cannot hide behind knowledge, science or technology to abstain from their responsibilities to make the difficult political changes needed to make have a sustainable development We agree that financing of poverty reduction and global public goods be based on a set of global rights and responsibilities. But we disagree to a graduated process as proposed by the SDSN s Report. The United Nations has already outlined fundamental rights and responsibilities that need immediate attention. While we acknowledge the challenges of population growth, we disagree that poverty reduction be focused on simplistic programs such as reducing populations. Fertility rates only exacerbate, but do not cause, household poverty-as evidenced in India, Nigeria, Ethiopia and Sudan. In Africa the key challenge is not population growth s the SDSN Report would like us to believe. The continent is facing challenges caused by corporate and foreign government land acquisition and commercial farming that has destroyed small holder agriculture and denied many households their only source of livelihood. These challenges cannot be addressed by simple population control programs. 4. Inequality and Development We commend the SDSN for proposing that every country should have relative poverty measurement-the % of households in a country who earn less than half the median household income, and subjective individual social well being-instead of relying on GDP alone. But the Report fails to note that just a handful of countries have contributed to the 60% end to global povertymeaning the benefits have not accrued universally. Fifty two per cent (52%) of the world still represents 90% of the World GDP-with the remaining 48% (or a whopping 3.456 billion people) struggling to share out 10% of the Global Wealth! 12 While the SDSN tells us that poverty has reduced dramatically, the World Bank issued on February 29, 2012, a Global Poverty Update wherein it manifests that At the current rate of progress there will still be around 1 billion people living below $1.25 per day in 2015. Many of these people are in conflict ridden countries driven mainly by resource exploitation and other global factors beyond them. It s worth noting that these countries are also known to have the highest quantities of natural resources. In summary, while we agree with the SDSN that Inequality is widening we disagree with the SDSN assertion that this is primarily driven by technological changes and forces of globalization. We also reject the notion that they will be resolved through effective skills and training. 12 See, for example the OECD Review-Medium and Long Term Scenarios for Global Growth and Imbalances accessed herehttp://www.oecd.org/berlin/50405107.pdf 5 A C P Analysi s of the S u s tai n a b l e D e v e l o p m e n t S o l u ti o n s Netw o r k

The World s wealthiest 16% uses 80% of natural resources 13. This is hardly a major shift as the SDSN Report would want us to believe. It is sad that we can speak of ending poverty in all its forms under these conditions. 5. Business and Private Sector Accountbility We agree that Multinationals undermine effectiveness of national policies through regulatory and tax arbitrage cross jurisdictions. However as the Report acknowledges businesses account for two thirds of natural resource use and therefore transformation will impossible if business does not align with SDGs. We therefore wonder why the SDSN Report believes that shifts in business behavior should remain voluntary and based on voluntary accountability mechanisms. We agree with the following proposals by the SDSN Rich countries to lead in curtailing abusive Transfer pricing End to tax havens and access information and ensure participation Private incentives must be fully aligned with public objectives. And while we agree that we need a transparent and independent evaluation for businesses, we strongly ask that this be applied to ALL businesses and not just what the SDSN calls major corporations. We also call for a stronger evaluation of corporations and businesses, with citizens as the drivers of such evaluation. We reject the call that Businesses should be left to Self Regulations and other voluntary mechanisms such as those proposed by the SDSN Report 14 6. Peacebuilding and Conflict Transformation We fully accept the recognition that the most important public good is Peace and Security! 13 Read the full story here http://edition.cnn.com/us/9910/12/population.cosumption/ 14 There are several existing Voluntary evaluation mechanisms; the SDSN specifically mentions Environmental profit and loss statements developed by Puma, Integrated Reporting (IIRC), the Economics of ecosystems and Biodiversity (TEEB) for Business, Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB) pricing of externalities-both of which have failed to have any meaningful change on the conduct of businesses. 6 A C P Analysi s of the S u s tai n a b l e D e v e l o p m e n t S o l u ti o n s Netw o r k

We also agree that Personal security, ending conflicts and consolidating Peace are essential components of good governance We agree that the state of fragility will rise. But we reject the view by the SDSN that it can be addressed by economic opportunities and adequate training. These in our opinion are superficial measures. Instead we would recommend that we consider the Peacebuilding and StateBuilding Goals proposed by the International Dialogue on Peacebuilding and StateBuilding (IDPS) 15. The IDPS proposals, adopted by the General Assembly in April 2013, are more progressive and bolder than the recommendations of the SDSN. We agree that ending poverty and preventing conflicts and building peace require international support. But we find the proposals for support proposed by the SDSN-mediation, peacekeeping and assistance to addressing economic and social crises that drive such conflicts-as too minimal and does not take into account the complexity of conflicts in the world today. #END 15 See the full description of the PSGs here http://www.newdeal4peace.org/peacebuilding-and-statebuilding-goals/ 7 A C P Analysi s of the S u s tai n a b l e D e v e l o p m e n t S o l u ti o n s Netw o r k