Co-Chaired by Joseph Stiglitz, Akbar Noman and Ravi Kanbur

The Quality of Growth in Sub-Saharan Africa
A Workshop of the JICA-IPD Task Force on Africa

Co-Chaired by Joseph Stiglitz, Akbar Noman and Ravi Kanbur

Columbia University
6-7 June 2016

Monday 6 June

Workshop Opening and Objectives

Joseph Stiglitz, Akbar Noman, Ravi Kanbur, and Nobuko Kayashima

Joseph Stiglitz

In the opening session of the workshop, Joseph Stiglitz gave a brief speech highlighting the objectives of the JICA – IPD Task Force. He emphasized why the core topic up for discussion—ensuring “quality growth” for Africa— was an important one. Several key points were discussed. First, he mentioned that Africa has been a growth success before 2008 due to the abundance of natural resources but this impressive growth has since reversed. The goal to move away from dependence on natural resources is extremely important. Second, he re-emphasized an existing problem of income inequality and the fact that between country inequality (world inequality) has declined but within country inequality has been increasing. This phenomenon, he explains is mainly due to China raising more than 600 million people out of extreme poverty. He further gave Namibia as an example of a country that has succeeded in achieving the dual goal of diversifying their economy and lowering levels of inequality, improving on their educational system and health care system. Third, he mentioned that to better analyze these aforementioned issues, broader measures of “success” should be researched – i.e. measures that move away from the simple GDP measure and instead include some other metrics that measure the role of cities and the environment. Fourth, he remarked that it was important that Africa learned from other development success stories such as the East Asian miracles which have been a point of reference for success. He further tied this point to how JICA has played an important role in highlighting the insights of these success stories and how JICA has helped incorporate these insights in Africa. A caveat to the latter is that, African countries should not “carbon-copy” what these successful countries have used to achieve economic development. This is because Africa is different since it faces unique and multi-dimensional developmental issues.

Other points included; new issues facing rural and urban areas, climate change, the importance of the rule of law and impact of natural disasters. The key message highlighted what is important and what is new, in the process of achieving sustainable and quality growth for Africa.

Nobuko Kayashima

Since 1993, JICA has been organizing international conferences about African development. JICA and IPD have been working together to produce policy recommendations over the course of several projects. The focus of these projects is to achieve economic development, combat poverty and disparity between urban and rural areas, but also for the overall betterment of the quality of life in Africa.

Ravi Kanbur

It is important to tackle the right combination of relevant issues, whether they are ongoing or have recently emerged. Hopefully, each session of this conference will help reveal the most relevant issues in African development today.

Session I: Sustainable Development Goals and Africa

Ravi Kanbur, Lorenzo Fioramonti, Sakiko Fukuda-Parr

Ravi Kanbur – Sustainable Development Goals and Measurement of Economic and Social Progress

Highlights:

·  Rethinking growth

·  Focusing on sustainable development goals

·  Building upon the discussions of previous conferences

Currently, there are 17 goals and around 200 targets.

How did we get to such a high number of targets? Ban Ki-Moon claims success, attributes it to MDGs, although it is hard to establish such a causal relationship. Mostly, the examples of MDGs’ successes are anecdotal, as quantitative attributions are almost impossible to determine. These anecdotal examples are what heightened the interest of constituencies to push for their own targets.

Every constituency wanted to get into the process and voice their specific concerns. Therefore, the large number of targets reflects the complexity of the process perfectly well. Constituencies saw value in the process of addressing their specific issues, and MDGs emerged as a broad platform created by consensus.

What, then, can be done at the national level? A relevant point was raised in a previous conference by Ibrahim Patel, who stated that GDP is still a helpful measure in the policymaking process. There are advantages with GDP, as there are no alternative composite measures that address the relevant issues.

Since it is difficult to create an appropriate alternative composite measure, given the resources available, a dashboard approach may be the best possible option. However, the same difficulty arises in determining exactly which elements should be included in a manageable dashboard. Usually, the proposed dashboard elements include: GDP, indicators of inequality and poverty, such as the GINI, or a multidimensional poverty index. But, each of these elements is an aggregate of indicators, which further complicates choosing the right elements for a dashboard.

Perhaps, country-specific meetings would be a practical way for policymakers and analysts to define the appropriate elements.

A third question arises, regarding the global aspects of measurement of poverty and inequality. Methods of global poverty measurement are questionable. How can we account for expenditures, or global consumption? The current methods used to produce global measurements have become “ad hoc”, with no systematic method for anchoring a global poverty line.

Inequality, as an MDG goal, has been handled in a nationally oriented manner; however, it should be a global exercise to analyze inequality between countries vs inequality within countries. Within country inequality has risen; while between country inequality has fallen, which makes it difficult to determine whether inequality has actually risen or fallen.

The JICA/IPD task force is an important agent in this process, as it helps clarify the issues with the process and implementation of measures that should be used.

Lorenzo Fioramonti – The SDGs as a development roadmap for Africa: interactions, dynamics and modelling for policy

Highlights:

·  Unpacking the meaning of SDGs

·  More than a checklist: goals, targets and indicators are interconnected

·  Dynamic nature of development goals is often neglected

·  Replacing the current model of growth

The current model of growth is based on how GDP is measured; however, GDP is one of the main contributors to environmental destruction. It is no surprise, for example, that a perfect correlation between GDP and climate change can be found.

Since 1977, the trend is actually that economies have been shrinking, which points to the fact that there are serious issues with the way growth is measured and conceptualized. After accounting for factors, such as environmental damage and social costs, economic growth is much smaller than what is currently perceived. In Africa, for example, environmental destruction caused by extraction industries has led to the shrinking of economies, even while international financial institutions declared that GDP was growing.

Goals and indicators must have a policy anchor. Accountability to the national or global level must be clear in establishing these indicators, as mismatches between indicators and policy application can be dangerous within the SDGs debate. The data collection process and its constraints are important factors to note, as the process demands an extensive use of resources and creates an opportunity cost for each indicator that is actually chosen. Statisticians have limited resources to work with, the information from new technologies should be harnessed, instead of insisting on the old fashioned way of surveys.

The SDGs are a long list of goals and indicators that are often badly formulated, or redundant and placed on the list mostly to appease constituencies. What the SDGs really mean, is that the current model of growth is bankrupt.

While the SDGs open doors for convincing policymakers to implement change; as they stand now, the SDGs do not present a coherent narrative, simply a strategic window of opportunity. In order to implement lasting change, a new apparatus of measurement should be devised. Countries that strive for sustainable growth, instead of simple GDP growth, should be rewarded.

Building on existing tools can also be effective, as these should not be mutually exclusive measurement forms. A dashboard system could be used along with an aggregate indicator. The information available now should be used in a pragmatic fashion, while new technologies should be harnessed to maximize them.

Dynamic models are required, which should not simply consist of adding different levels and ticking more boxes. By grouping together indicators that are related, the Sustainable Wellbeing Index (SWI) synthesizes the SDGs into a coherent aggregate index. The SWI is a simple indicator that looks at different core dimensions of the SDGs. It also creates levels of saturation and thresholds, up to which wellbeing is unlikely to grow.

Statistics experts across Africa were consulted in the creation of these aggregate indicators, such as human development, quality of environment, etc. They are related to the SDGs, but simply named differently, in a way that is much easier for policymakers to understand.

The SWI accounts for the mutual correlation between sets of indicators, since these different dimensions reinforce or detract from each other. Planning policy cannot be done in a fragmented fashion, the interactions between dimensions has to be accounted for.

Sakiko Fukuda-Parr – Sustainable Development Goals (SDGs) and Africa

Highlights:

·  Progress in goal setting in contrast to MDGs: more democratic process

·  Goals still require mobilization and championing

·  Dangers of quantifying development goals

·  SDGs as a development policy framing device

The general idea of SDGs is that they have a communications purpose, as a political tool for mobilizing actions. The quantification of these targets and indicators can leave out very important aspects of an issue, which can be off-putting to some. With the MDGs, many of the targets were seen as useless and were not embraced by some civil society groups, especially in developing countries. Many argued those goals were harmful and distracting. MDGs were criticized for being incredibly narrow, leaving out highly important things like growth and industrialization, which is probably the reason why the SDGs are much broader.

The breadth of the SDGs results from the demands of governments, who negotiated against the notion of restrictive global goals. The SDGs are a process of contestation between conflicting countries. They help establish that the development debate should go beyond combating poverty. They provide an instrument that can influence policy. They don’t create incentives, but they influence policy by creating narratives that frame policy debates.

Not all of the SDGs will be prioritized. Following the MDGs example, where some items were completely neglected. Certain goals were championed and mobilized many agents, while other goals were not championed and gained little traction. Continued pressure is needed in order to make certain targets relevant.

During the SDG negotiations, the demands of African countries show a strong focus on shifts in global policies, the development of global partnerships in the international economic environment and the role of state.

The quantification of development goals can be very dangerous. All the issues being promoted- industrial policy, role of the state, reform of the international economic and financial systems- are not things that can be well quantified, tracked and monitored. For example, the indicator chosen to measure the technology SDG goal is the number of science agreements and fixed broadband internet subscriptions. It is hard to tell how this indicator will effectively monitor technological cooperation issues, in terms of access to the latest technologies needed by developing countries.

Some of the most important issues are not easily monitored, it is unclear what kind of development narrative will emerge. SDGs may lead to manipulation of development policies and mask other issues in the undercurrent, such as new trade and investment agreements. Overall, these new trade agreements are problematic and disturbing for many reasons. Specifically, these agreements reinforce investor and corporate interest and reduce policy space for all countries.

In conclusion, it is necessary to reflect on what SDGs are good for, and how they can be used. It is important to recognize that SDGs are not innocuous indicators. While the process has become much more democratic, a more powerful set of agreements is actually rewriting the global rules.

Discussion:

·  Global rules issues are happening concurrently with the setting of SDGs. In order to get a feasible model of global governance, reform is needed. (Noman)

·  Concerns with global rules. Often, trade agreements reflect the interests of corporations, this includes the US. The transparency involved in agreement construction is questionable. As far as SDGs, they are important because they show a norm in global target setting. Some of the indicators are not ultimate objectives, but are intermediate variables. The variables, and the ways they are measured, reflect current societal parameters. In different countries, the rule of law may mean different things, reflecting embedded values. Just as different measures call attention to different things. Thus, the ambiguity is not necessarily an issue. If a democratic society is established, it can actually generate a debate to determine measures in different countries or subcontinents. The consensus can be reached in that way. (Stiglitz)

·  The discussion is not always grounded in the political process. Institutions feel obliged to fight for themselves and issues that cannot be quantified on their own often don’t get the merit. For example, poverty was separated from hunger so that funding could be mobilized. A pragmatic approach is needed to improve the visibility of the statistics. (Jomo)

·  Working with the African union at ECA is very important. For member states of Africa, there is a lot of confusion around goals, indicators and elements. Largely due to framing, also because many of these organizations were not part of the discussion. A lot of confusion on the ground, as presidents agree on these agendas, while organizations and agencies are excluded. (Manuh)

·  SDGs are very ambiguous. They allow for distraction, powerful countries push for their own interests and stakes, while some leaders of African countries simply go along with certain policies. These targets and indicators become abstract, then applied to address basic problems, in countries that cannot even produce statistics on fiscal flows. Fundamentals must be addressed first. (Ansu)