MDGs: prospect or a misplaced buoyancy?
By Dr. Noor Fatima

The arguments for or against, is an issue of extensive debate but the fact remains that Millennium Development Goals (MDGs) have appeared in the classic narrative of economic development that poor countries are caught in poverty traps, they need a Big Push involving increased aid and investment, leading to a takeoff in per capita income. This paradigm has been very influential in development economics after World War-II and the concept was used for the justification for foreign aid and also to observe financial strategies framed by the Bretton Wood Institutions.

This narrative lost credibility during 1980s when most of the development countries fell into poverty trap with mounting debt. During 1990s the aid and grants were linked with the poverty reduction and economic development/growth. Most recently it came back with the name of New Millennium Goals- target date of 2015. There are different concerns of the economist and critics that do this “Big Pushes” work? Does economic development happens mainly through Big Pushes?

Since the evolution of the development history three inter-related concepts are explored: the Big Push, the Poverty Trap, and the Takeoff. The traditional development narrative, has recently regained favor that- least developed countries are caught in a Poverty Trap, so they need a Big Push and thereafter they will takeoff into self-sustained growth. Therefore, MDGs push for, is to have equilibrium between the economic and political rights of the society. The concept of effective social engineering for exploring the opportunities is to be materialised through the MDGs.

It is invoked once again through the major eight development goals to be achieved by the development countries. To the extend of goals setting it is quite appealing: reduce extreme poverty and hunger by half; achieve universal primary education, promote gender equality and empower women, reduce infant mortality by two-thirds; ensure environmental sustainability; develop a global partnership for development and enhanced debt relief for heavily indebted poor countries.

The performance of MDGs by 2015 will be measured in terms of policy change of developing countries and not on how West has performed? What we should not overlook is that these goals are not initiated by the South but fixed by the US, allied and sponsored by International Financial Institution for economic cooperation. So the question is not whether can world afford to achieve Millennium Development Goals? But the question is whether can world afford, not investing in the basic social security. As turmoil continue to afflict much of the developing world, only achieving the MDGs is not a condition to attain a peaceful and poverty free world. In fact the large-scale effort for mobilising support for the MDGs is a major priority of the international community, including the UN and other organisations. If we observe, the each goal is interrelated—the success of one depends on the others. To achieve first 7 Goals, the Goal #8: is the most critical to meet i.e. strong partnerships at all levels–globally, nationally and locally–that can bring about change vital for ending poverty and discrimination. This assertiveness will bring change only if it is recognises and accepts the significance of achieving the MDGs for the future developed society in a country given specific conditions.

Poor countries needs catch up with developed countries on poverty eradication —by high investments in health, education, nutrition and general well-being. In case of Pakistan this assertiveness also blinds us when we come closer to the ground reality, where things are more complicated. No serious dent is made, in poverty alleviation and it has risen. If we look at just priorities in public spending of public expenditure on health, public expenditure on education and total debt servicing of Pakistan as compared to others in the region, reflecting the investment in basic social needs and aid obligation, it will show the picture as under: (See Fig-1)

In this priority context, the goals setting is far away from the comprehensions of the competitiveness of industry, goods & services, opening up of the borders of developing countries with the developed world on equal level, is not viable option. The share of export of Pakistan in to world is less then 1 per cent therefore, the reduction in subsidy and tariff would have forceful implications on the MDGs. There is need of major changes in the trade terms of North and South. Otherwise the country like Pakistan will forever remain as ‘second class’ country. Similarly foreign investment in Pakistan entails with technological transfer for a practical partnership with the develop countries. Moreover, substantial increase of the aid in social sector is required which was ironically reduced in the 1990s by the aid donors.

Good governance and economic development is very much focused in the MDGs but these are not mutually exclusive or alternate themes, it has to be pursued simultaneously to ensure greater human security through socio-economic development. There can not be a single model of governance valid for all times to come for all societies in the context of development. The strategies of neo-liberalism economy may contradict itself in the context of development. Millennium Development Goals, which calls for the elimination of ‘extreme poverty’ by 2015, in this sense "the end of poverty”, can be only the end of extreme poverty, or for that matter the people should reach to the “moderate poverty” between one to two dollars per day, only then it can lead to economic security.

As a whole these goals are considered a further extension of the neo-liberal initiative. According to the critics the idea of the takeoff does not acquire much support in the data. Keeping in view the goals and targets, a paradigm shift in the concept of the MDGs, is required. There is a need to look at in the perspective of the specific country conditions and ground realities and not in the given targets under the world development concept. This is precisely the reason that the “good governance” is served as an empty rhetoric of the MDGs.

Pakistan is classified as a low-income country. Though Human Development Index (HDI) rose by 1.6 per cent per annum over the period of last 30 years and not enough to fulfill the targets of MDGs. Pakistan is lacking behind in South Asia on many social indicators, ranking 136 out of 177 countries in 2007. The major reason is that the social sector’s was neglected for a long time with the spending less than 2 per cent of the GDP on education as shown in above figure.

Pakistan is also ranked lowest on most gender-related development indicators. The indicators also show economic discrimination for women. Further the poverty indicators show that inequality has increased during 1990s. There are important contrasts between urban and rural and regions in the incidence of poverty. Though last three years have seen high economic growth rate but in case of Pakistan, it can be concluded that relationship between growth and poverty reduction is not automatic. Pakistan has seen strong economic growth in 1960s, 1980s and 2005, and from the history it is obvious that economic growth is not an inevitable element for translating the economic growth to poverty reduction. After witnessing the higher growth of even 8 per cent, the biggest remained to deal with the inequality of the resource distribution in the society. Therefore the significance of the pro-poor growth and strategy to translate the growth into poverty reduction becomes the biggest challenge. Keeping this challenge after 1990s the challenge of balanced growth and development with sustainable policies has been recognised. The biggest challenge in achieving these goals is to ensure growth that translates into sustainable development with less inequality and to draw the attention of the different production sectors in which growth generates greatest impact on poverty reduction.

The promotion of ‘pro-poor’ growth therefore, would be the key to sustainability of economic growth to achieve MDGs by 2015. The description of poverty traps, big pushes, and takeoffs as a justification for foreign aid, receives scarce support in the actual experiences of economic development. The realities on ground for the goal and target are more consistent that allows the motivation to take small steps from the bottom, as opposed to development happening from a big push planner at the top which proves to be an exaggerated development opportunity.