Giving development a chance

Secretary-General of the OECD

Just a few days ago, an article appeared in a major Canadian newspaper deploring the exodus of qualified doctors and nurses from African countries struggling to contain disease, especially AIDS. These highly skilled professionals are being attracted by opportunities in more developed countries, but while they may look forward to better lives, the communities they leave suffer an important loss.

This story raises a key question about development and development assistance: can governments that say they wish to foster development among poorer countries do so, when at the same time they pursue policies that impoverish the countries they are trying to help?

The general problem is a lack of coherence among policies: one set of policy objectives conflicts with or undermines another. Alas, policy incoherence in government programmes is common. As a former politician and cabinet minister in a G7 country, I enjoyed a firsthand view of that. In every instance I recall, incoherence was rooted in what were perceived by some as political imperatives.

I have encountered two schools of thought within the OECD on what can be done. The first is the one I champion, namely our role in pointing out how some of our policies undermine development. Agricultural subsidies and trade barriers are notorious examples, for not only do they prevent the developing world from fully exploiting our markets, but they prevent our own citizens from accessing cheaper, often better, products.

Tied aid, which commits recipients of financial assistance to specific suppliers from donor countries, is also an incoherent policy, as it is in direct conflict with trade liberalisation and free markets. Again, it is motivated by political considerations. Some argue that without tied aid, development funding would decline! If this position is correct, it suggests that incoherence is sometimes better than nothing. I am not convinced.

But it is incoherence in the area of migration that troubles me right now, particularly if it means emptying the developing world of valuable human capital. Migration can be a positive force if, for instance, it results in substantial financial remittances back to the developing world. But the active recruitment efforts by developed countries – some call it poaching – to induce skilled doctors, nurses, scientists and engineers to settle in rich economies, without any compensation for the investment in these skills made by the taxpayers in low-income ones, is a concern. These skills are competitively priced by OECD standards, but they may be scarce and valuable back home.

Human capital is the most important driver of economic growth. Physical assets or commodities cannot migrate of their own volition. Human capital can and does. Obviously, preventing migration would be unacceptable, the movement of labour being a fundamental freedom we uphold. But there is still incoherence in terms of a development strategy when OECD governments actively solicit skills from the developing world that cannot easily be replaced. Some coherence might be restored, for instance, if public policy in destination countries required some compensating payment in return.

Some argue that it is incoherent if we do not bring the policy knowledge within the OECD to developing countries, for their direct benefit. Though I have long promoted this concept of transferring knowledge, to me, this is not an issue of policy coherence; this is an issue of development policy, pure and simple. My own view is that there has been a widespread failure of the development community over many years to identify, adapt and apply the policies and insights within their governments and within the OECD that could spur development. It is now accepted wisdom that development cannot be a matter only of roads and bridges, or schools and hospitals, but must also be built on a policy environment founded on the rule of law, and institutions that enable businesses and the economy to flourish. We must transmit our expertise in such matters if we are to make our own donor aid and development policies more effective. Moving money and goods is important, but so is moving knowledge and expertise.

Imparting this knowledge offers an enhanced role for the OECD development community. Its members are well placed to identify the policy shortcomings and needs of development strategies on the ground, as well as transmitting knowledge, in areas like technology, banking, legal reform, and so on. There is, of course, a need for governments in developing countries to ensure coherence in their own policymaking. Have they created a favourable environment for investment? Are they cutting their tariffs? Are they building the institutions that are needed for market economies and successful entrepreneurship? Just like flows of trade, skills and knowledge, policy coherence for development is a two-way street.

©OECD Observer No 245, November 2004




Economic data

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive paper editions delivered to you directly


Online edition
Previous editions

Don't miss

  • Africa's cities at the forefront of progress: Africa is urbanising at a historically rapid pace coupled with an unprecedented demographic boom. By 2050, about 56% of Africans are expected to live in cities. This poses major policy challenges, but make no mistake: Africa’s cities and towns are engines of progress that, if harnessed correctly, can fuel the entire continent’s sustainable development.
  • “Nizip” refugee camp visit
    July 2016: OECD Secretary-General Angel Gurría visits the “Nizip” refugee camp, situated between Gaziantep and the Turkish-Syrian border, accompanied by Turkey’s Deputy Prime Minister Mehmet Şimşek. The camp accommodates a small number of the 2.75 million Syrians currently registered in Turkey, mostly outside the camps. In his tour of the camp, Mr Gurría visits a school, speaks with refugees and gives a short interview.
  • OECD Observer i-Sheet Series: OECD Observer i-Sheets are smart contents pages on major issues and events. Use them to find current or recent articles, video, books and working papers. To browse on paper and read on line, or simply download.
  • Queen Maxima of the Netherlands gives a speech next to Mexico's President Enrique Pena Nieto (not pictured) during the International Forum of Financial Inclusion at the National Palace in Mexico City, Mexico June 21, 2016.
  • How sustainable is the ocean as a source of economic development? The Ocean Economy in 2030 examines the risks and uncertainties surrounding the future development of ocean industries, the innovations required in science and technology to support their progress, their potential contribution to green growth and some of the implications for ocean management.
  • OECD Environment Director Simon Upton presented a talk at Imperial College London on 21 April 2016. With the world awash in surplus oil and prices languishing around US$40 per barrel, how can governments step up efforts to transform the world’s energy systems in line with the Paris Agreement?
  • Happy 10th birthday to Twitter. This 2008 OECD Observer interview with Henry Copeland said you’d do well.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Once migrants reach Europe, countries face integration challenge: OECD's Thomas Liebig speaks to NPR's Audie Cornish.

  • Message from the International Space Station to COP21

  • The carbon clock is ticking: OECD’s Gurría on CNBC

  • If we want to reach zero net emissions by the end of the century, we must align our policies for a low-carbon economy, put a price on carbon everywhere, spend less subsidising fossil fuels and invest more in clean energy. OECD at #COP21 – OECD statement for #COP21
  • They are green and local --It’s a new generation of entrepreneurs in Kenya with big dreams of sustainable energy and the drive to see their innovative technologies throughout Africa. blogs.worldbank.org
  • Pole to Paris Project
  • In order to face global warming, Asia needs at least $40 billion per year, derived from both the public and private sector. Read how to bridge the climate financing gap on the Asian Bank of Development's website.
  • How can cities fight climate change?
    Discover projects in Denmark, Canada, Australia, Japan and Mexico.
  • Climate: What's changed, what hasn't, what we can do about it.
    Lecture by OECD Secretary-General Angel Gurría, hosted by the London School of Economics and Aviva Investors in association with ClimateWise, London, UK, 3 July 2015.
  • Is technological progress slowing down? Is it speeding up? At the OECD, we believe the research from our Future of ‪Productivity‬ project helps to resolve this paradox.
  • Is inequality bad for growth? That redistribution boosts economies is not established by the evidence says FT economics editor Chris Giles. Read more on www.ft.com.
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .

Most Popular Articles

Poll

What issue are you most concerned about in 2016?

Unemployment
Euro crisis
International conflict
Global warming
Other

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2016