Making policies work

GREAT insights Magazine

Post-2015 Agenda

The Challenge of Economic Transformation

April 2013

Maina, B., and Prato, S. 2013. Post-2015 agenda: The challenge of economic transformation. GREAT Insights, Volume 2, Issue 3. April 2013. Maastricht: ECDPM

The Post-2015 development framework should inspire a transformative agenda that addresses the root causes of poverty and marginalization. This is a politically challenging agenda as it involves significant redistributive action to promote inclusiveness, equity and sustainability.

Over the past six months, the High Level Panel of Eminent Persons on the Post-2015 Development Agenda (HLP) has stimulated engagement by the development community with a myriad of initiatives, conferences, policy documents and blogosphere discussions to reflect on what should replace the Millennium Development Goals (MDGs) as they reach their established deadline in 2015, and how to reconcile this process with the outcomes of the Rio+20 review.

The HLP – co-chaired by President Yudhoyono of Indonesia, President Johnson Sirleaf of Liberia, and Prime Minister Cameron of the UK – is one of many mechanisms meant to converge on the UN General Assembly, either directly or via the UN Secretary General, in order to advance the inter-governmental process and shape the new framework.

From an aid to a policy framework

The starting point of the post-2015 journey should be an assessment of what has really worked with the MDG framework and what has not. Unfortunately, this is no easy task as the debate has become an almost ideological confrontation between a pro-MDG party, who underline the simplicity, concreteness and results-orientation of the framework, and its opponents, who question what real progress is attributable to the MDGs and would not have happened even in their absence.

Beyond any valid criticisms of the MDG framework, the overwhelming energy to debate the post-2015 agenda confirms the ability of a global partnership framework like that of the MDGs – as imperfect as it might be – to rally support and engage constituencies in a common global processes. While this highlights the importance of the ‘communication and constituency building’ dimension of the post-2015 agenda, it also underplays the fundamental shift between the MDGs and whatever is meant to replace them.

The former was largely an aid-framework and had an important purpose to serve in aligning domestic political support in developed countries in order to maintain and possibly expand development cooperation budgets. The new agenda will be much more of a policy framework than an aid one and would therefore aim to inspire coherent policies at national and global levels within a new global partnership. While aid will remain important, particularly in the short term, resources are expected to be generated at multiple levels.

This pivotal shift in focus should ring an alarm bell as the ‘communication simplicity’ of the MDGs has sometimes translated into ‘policy simplicism’. In advancing discussions on the new framework, it is therefore important to de-couple policy considerations from communication strategies.

‘One’ global development agenda

Over the past months significant agreement has emerged for ‘one’ overall development framework that reconciles the social and economic agendas and incorporates sustainability at its core. While centered on a strong commitment to eradicate poverty, this universal agenda recognizes its multidimensional nature and its strong nexus with prosperity. The geography of poverty and the emergence of new forms of marginalization can only confirm that these – beyond the historical determinants and injustices – are proxies of the failure of current socio-economic frameworks, and manifest a global equity and inclusiveness problem. Rather than an isolated social development agenda, the fight against poverty therefore becomes an integral part of a strategy for economic transformation and empowerment which can only be built around the premise of sustainability.

Beyond pursuing social outcomes it is therefore necessary for the new agenda to address the root causes of poverty and marginalization and all their novel manifestations even in developed countries with new poverties, high unemployment and social exclusion. This calls for an agenda of economic transformation that, while continuing to address key human development challenges, also promotes economic empowerment, equity and inclusiveness.

Four different policy domains should therefore be addressed by the new framework:

(1) The reaffirmation of the MDG commitment to expand human capabilities and promote well-being through a much more integrated and holistic agenda for human development that combines health, education, nutrition, access to water and sanitation (overcoming the MDG fragmentation) and promotes personal security and bodily integrity with stronger emphasis on the elimination of violence against women;

(2) The promotion of inclusive, equitable and sustainable economic development with a clear focus on the fundamental social outcomes the economy needs to pursue;

(3) The responsible management of our global commons (not only our ecosystems and cultural heritage but also the openness and fairness of international trade, financial stability, etc.); and,

(4) The promotion of legitimate, transparent and accountable institutions (state but also civil society and private sector) that will need to rise to the policy and implementation challenges that the agenda involves.

Beyond the content of the framework, another element of emerging consensus is that of fostering a proper balance between global partnership and full national ownership of the development agenda. This means that the new framework will have to strike a proper balance between internationally agreed priorities and their embodiment in fully-owned national targets and plans. However such ownership cannot be identified exclusively with the state but rather a concerted agenda between the state and all its key stakeholders, with special emphasis on civil society and the private sector.

Inclusive, equitable and sustainable economic development

One the central pillars of the new framework will therefore be the pursuit of inclusive, equitable and sustainable economic development. This calls for a new partnership between state, civil society and private sector and a new set of policies which will aim to:

(1) Promote an enabling environment for responsible business to flourish: legal frameworks, macro-economic stability, fairness of trade terms and efficient public services but also a new corporate business code and clear norms for corporate transparency and accountability;

(2) Foster economic transformation: This is particularly important for Africa as it attempts to move away from the existing economic power structures and division of labor that relegated it to the role of producing primary commodities and minerals. Transformation means rebalancing the economic center of gravity towards the domestic market and promoting significant increases in manufacturing value against today’s diminishing returns of primary commodities. It also means to advance industrialization and economic diversification and stimulate the development of new supply-chains/value chains that can increase economic pluralism and the job-intensity of local/national productions;

(3) Inclusiveness of the margins: Provide increased connectivity and integration between the formal and the informal economy by extending business development services, social protection, scaling-up opportunity (knowledge, finance, connectivity to supply chains and product clusters) and catalyzing innovation in business models for small scale production and its financing;

(4) Investment in infrastructures: Promote further investment in infrastructure with an emphasis both on the industrial/trade sectors (energy, roads, etc.) but also on the needs of small and medium-sized enterprises (SMEs) and the informal sector (transport, mobility, connectivity);

(5) Energy: Provide clean and affordable energy in the absence of which it is difficult to foster any significant increase of productive capacity and significant expansion of social services;

(6) Public-private partnership: Promote public-private partnership in technological innovation and research and explore new tripartite arrangements (state-private sector-civil society) for the provision of social services;

(7) Gender equality and women’s empowerment: Beyond the fundamental value proposition that is involved in gender equality, its pursuit also carries the greatest potential for fundamental transformation of our socio-economic frameworks. Women’s empowerment also requires addressing the fundamental issues of care within society and seek innovative ways to explore a new set of social provisions that address the increasing tension between women’s productive and reproductive/care roles.

The role of the private sector

Given this possible scope and policy focus of the Post-2015 Development Agenda, it is important to recognize the centrality of private enterprise in the pursuit of the development agenda.

Private sector as development partner: With the strong emphasis on economic transformation to ensure social outcomes (job-intensity and decent work, inclusiveness, equity, sustainability), it is fundamental to engage the private sector as a critical partner in the post-2015 process at design, implementation and monitoring stages. At the same time, such a partnership calls for a new corporate code of conduct and a stronger commitment to transparency and accountability;

Focus on economic empowerment and agency: The framework should also emphasize the importance of combining investment in human development and political participation with a much stronger emphasis on the economic empowerment of the poor and marginalized –one that builds on people’s agency and creativity and strengthens current livelihoods strategies. This involves the shift from an approach that aimed to ‘lift’ people out of poverty to one that emphasizes the creation of conditions that can provide capabilities, enabling environment and catalytic support for people to take charge of their lives and therefore ‘lift themselves’ out of their condition of marginalization;

Multi-stakeholder dialogue: The new agenda also calls for sustained dialogue between the state, civil society and private sector to both shape and define the new agenda and monitor its implementation. It is therefore necessary to strengthen business associations at various levels and identify new institutional mechanisms for the full inclusion of the private sector in the ongoing policy dialogues on development strategies. However, such mechanisms would also need to ensure proper access to small and medium scale enterprises and therefore seek to bridge current deficits in representation of smaller economic actors in global and national decision shaping and making.

Last word

In conclusion, the post-2015 agenda will be much more politically challenging than the current MDG framework as it aims to address the root causes of poverty and marginalization. This calls for extraordinary political and civic engagement at all levels and a truly global multi-stakeholder partnership.

Betty Maina is the CEO of the Kenyan Association of Manufacturers (KAM) and a member of the High Level Panel on the Post-2015 Development Agenda. Stefano Prato is the Managing Director of the Society for International Development and Betty’s Adviser on the High Level Panel on the Post-2015 Development Agenda.

This article was published in Great Insights Volume 2, Issue 3 (April 2013)

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Economic Transformation and TradeStrengthening European External ActionEU Development Policy and PracticePost-2015 Global Development AgendaMillennium Development Goals (MDGs)Post 2015Private sectorAfrica

External authors

Betty Maina

Stefano Prato