Recent trends in international development efforts :
background and issue at stake
A Southern Perspective
Stakeholders Meeting of the Belgian Cooperation
Brussels
Vicente Paolo Yu III
4 May 2011
Wēijī - precarious moment; crucial point in a dangerous context
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Multiple crises with differentiated impacts on North and
South:
• Finance/economic
• Food
• Energy
• Climate change
• Natural disasters
Widening the development gap
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Multiple crises  threatens development; reduces adaptive
capacity in poor countries
the poor in many developing countries are in fact becoming
even poorer and more insecure. Human development is at risk
in many developing countries, and ability to cope is becoming
further eroded
Periods of crisis is when development cooperation between North and
South has to be even more intensified and strengthened, but in ways
different from traditional ODA approaches
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Emergence of the «South»
A new trend of convergence with the North?
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Source: UNCTAD (December 2010)
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Rising South – a largely Asian story
Source: UNCTAD (December 2010)
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Global and national economic imbalances which continue to threaten
growth prospects in many developing countries:
• persistent boom-bust cycles which, in many cases, have been driven by
fluctuations in interest rates and commodity prices determined in
financial markets located, funded and regulated in the advanced
countries. These fluctuations have hit the South severely, especially
given the recent accumulation of debt, especially in the private sector.
• weak investment performance in many countries
• growing income inequalities – although there are exceptions, especially
in countries implementing aggressively distributive wage, employment
and income support policies.
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Broad-based development across all of the South is needed
-
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More inclusive
Focused on development of productive capacity
Supported by multilateral reforms providing policy space and
channeling real and financial resources for sustained growth and
equity.
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Challenges for North-South Development Cooperation:
Development cooperation must be strengthened:
• Focusing on the development of productive capacity in the South
• Creation of enabling global environment – reforms in institutional
arrangements, policies, modalities for action – that would increase
South ability to increase productive capacity and living standards
sustainably while also maintaining ability of North to continue to
provide decent living standards for their people
It is easy for altruism to take place when times are good, which is when it
is not really needed, but harder for cooperation to take place when times
are bad, which is when it is really needed
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Belgium has been a good example in maintaining and increasing net
levels of ODA disbursement despite financial crisis
3500
3000
3000.23
2500
2000
1963.36 1976.94
1950.7
1463.31
1500
2385.64 2609.6
1000
500
0
2004
2005
2006
2007
2008
2009
2010
Belgian ODA Net Disbursements: 2004-2010 (in US$ Millions at current prices)
(OECD-DAC database)
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OECD DAC overall record in net ODA disbursements has been
more volatile
79854.46
2004
2005
121954.33
107837.72
119780.95128728.34
104814.29104206.07
2006
2007
2008
2009
2010
OECD DAC ODA Net Disbursements: 2004-2010 (in US$ Millions at current prices) (OECD-DAC database)
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Development of productive capacity in the South requires North-South
development cooperation in:
• Adequate and predictable sources of development finance to complement
domestic resource mobilization for the development of productive capacity
(e.g. productive infrastructure investment that creates jobs in increasingly
diversified and higher-value added economic sectors)
• Financial policy regulatory reform to promote longer-term productive
investment
• Support for reforms in international financial architecture to support
catching-up and inclusive growth in the South. These can include
development banks, compensatory financing, balance of payments
support, currency arrangements and a wide variety of other mechanisms
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Thank you
Vicente Paolo Yu
South Centre
17 Chemin du Champ d’Anier
1211 Geneva
Tel: +41 22 7918050
Fax: +41 22 7988531
Email: [email protected]
[email protected]
www.southcentre.org
Tel: +41 22 791 80 50
Fax: +41 22 798 85 31
17-19 Chemin du Champ d'Anier
1209 Petit Saconnex, Geneva