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Millennium Development Goals in Turbulent Times: Emerging Challenges for Post-2015 MDGs

Rolph van der Hoeven and Peter van Bergeijk

One of the most important trends that emerged since the launch of the Millennium Development Goals (MDGs) is the rapid growth of some large developing countries such as China, India, and Brazil. Figure 1 illustrates the shift of the economic weight of these countries, especially over the last decade. Current IMF projections indicate that by 2015 the principal providers of official development assistance (ODA)—Europe, Japan, the US—will be producing less than 50 per cent of total world GDP. Already before the financial crisis it was clear that this geo-economic shift would have to have an impact on the norms and values of the global system (van Bergeijk 2009). In this Angle article we argue that a post-2015 framework for development needs to be based on a global social contract, relevant to people in the South and the North, rather than being dominated by development aid professionals and merely applicable to the South.

Figure 1 share in global production. Source: Maddison (2010). WIDER Angle June-July 2012. 
                          Source: Maddison (2010).


The emerging economies and the emerging challenges

Ironically, it was the 2008 financial crisis that forced the group of G8 countries to accept the G20 as an institute of global governance to fend off the crisis and to build a basis for an improved global financial structure (van Bergeijk, de Haan, and van der Hoeven 2011). The acceptance of the G20 is a recognition of new economic realities. It is difficult to see why the new emerging reality should be limited to the financial structure. Indeed, our starting point is that a post-2015 framework for global development cannot ignore the shifting geo-political landscape. The traditional donors, unlike in 2000, cannot be in the driving seat.

The Millennium Declaration set the MDGs as global targets. Unfortunately it was not made clear what global meant. For some global simply implied universal (e.g. that all countries should achieve the same percentage reduction in poverty). It became clear that this could be especially unfair to poorer countries (Easterly 2009). Others interpreted the MDGs to be of relevance only for the world as a whole. Unexpectedly, that made the MDGs much easier to achieve due to the performance of a very few, very large, very fast growing countries that will determine any global outcome. For example, depending on exact definitions and interpretation of the time frame,  the MDG 1 goal of halving poverty has been achieved long before 2015 because of the extra ordinary growth in China, India, and Brazil.

Relatedly, due to the growth spurt of these three countries about three-quarters of the poor now live in middle-income countries since large low-income countries in 2000 have ‘graduated’ to the group of middle-income countries (see Figure 2). According to Sumner (2010) only 28 per cent of the global poor lives in low-income countries (of which 12 per cent in fragile states, and 16 per cent in stable countries).

Figure 2 Share of USD 1.25/ day global poor by country type. Source: Sumner (2010: Table 4.2). WIDER Angle June-July 2012. 

                          Source: Sumner (2010: Table 4.2).

Obviously, the observation that three-quarters of the poor do not live in poor countries must have important consequences for both the instruments and the targets of poverty reduction as well as for other MDG targets. For most of the world’s poor ODA in the traditional sense has become irrelevant. Poor households in middle-income countries would benefit more from an improvement in income distribution, improved access to social services, good productive jobs, a well-functioning rights-based system, that gives people access to government services and workers to exercising their labour rights etc. This challenges the world community: how should the development goals in a post-2015 system be set? The goal now must be to ensure that the poor in middle-income countries can benefit from the developments in their countries and can exercise their rights to a greater share of the proceeds from development. Clearly, a post-2015 system has thus to come to grips with human issues (economic, social, cultural), as well as with issues of inequality and redistribution.

Thus the changing geo-political landscape, the increasing diversity of the developing countries, as well as the radically different development levels and development patterns of the countries where the global poor live, imply that a post-2015 development framework needs to give much more attention to development patterns, goals and targets at the national level.

A new global social contract

A post-2015 development agenda should take the form of a global social contract in which the least developed countries (LDCs) would be guaranteed concessional resources to achieve inclusion in the world economy and poverty reduction while families in LDCs, emerging, and developed countries would have guarantees and ability to exercise economic, social and labour rights for a better share in the national development outcomes and, at a minimum, safeguards for social protection in times of economic downturns. The best form such a social contract can be given is a renewal and actualization of the social contract with all countries via the Millennium Declaration of 2000.

One might argue that our suggestion for a global social contract will overload the post-2015 development framework, undoing the main strength of the current MDGs—their simplicity.  However, with hindsight and taking into account the lessons of the triple crises of nutrition, finance and environment, we argue that simplicity blurs effectiveness. Indeed, traditional development aid interventions, as formulated in the MDGs, oftentimes do not provide an effective response nor enables the poor to grow out of poverty. New challenges need therefore to be confronted in a post-2015 system, but these challenges should always be put in the context of answering: ‘how families and poor households in developing countries can rely on a post-2015 development agenda in times of economic crises’.

Essentially, a viable post-2015 system can only be build on a global social contract on the basis of the current trends and future expectations. In this process all concerns should be discussed; precluding certain issues or concerns beforehand, with the argument that these may make a future set of development goals too broad, is for the moment not relevant. If issues are kept off the table, a later future agreement on a post-2015 development framework risks being seriously compromised from the beginning.

Table 1 provides elements that should be discussed in the leading up to the new development goals. Our list is not exhaustive but can serve as a guide for discussions and negotiations of a post-2015 development framework.

Table 1: MDGs in 2000 and post-2015. Source: van der Hoeven (2012). WIDER Angle June July 2012.
Source: van der Hoeven (2012).

Concluding remarks

The MDGs have since their inception played a positive role in drawing more attention to development aid. Current socio-economic developments—notably increasing inequality, strong GDP growth in emerging countries, and climate change—warrant a new approach towards a sustainable and equitable growth in all countries to provide a new post-2015 framework for global development. That framework should pay special attention to employment, inequality, environment, human rights, a global social floor and improved global governance.

The geo-economic shifts force us to rethink the concept of development, poverty and the goals that the world will set itself in 2015. The crises of 2008, and the current challenges of the reduction of public and private debts caused by the financial crisis, make it very clear that protecting the poor and the socially disadvantaged in industrialized countries has also become a serious political and societal problem. One might, therefore, consider MDG targets for all countries including the developed countries. First, the growing globalization and greater interconnectedness is creating hardships also for socio-economic groups in developed countries, and it would be politically unwise to ignore this in a post-2015 system. Second, targets for all countries in a post-2015 system need to express better than in the current MDG system the continuing and shared responsibility of each country in our global world.

References

Easterly, W. (2009). ‘How the Millennium Development Goals are Unfair to Africa’, World Development, 37 (1):26-35.

Fukuda-Parr, S. (2010). ‘Reducing Inequality: The Missing MDG: A Content Review of PRSPs and Bilateral Donor Policy
     Statements’. IDS Bulletin, 41(1).

Sumner, A. (2010). ‘Global Poverty and the New Bottom Billion: What if Three-quarters of the World’s Poor Live in
     Middle-income Countries?’. IDS Working Paper, No. 349. Brighton: IDS.

van Bergeijk, P.A.G. (2009). Economic Diplomacy and the Geography of International Trade. Cheltenham: Edward Elgar.

van Bergeijk, P.A.G., A. de Haan, and R. van der Hoeven (eds) (2011). The Financial Crisis and Developing Countries:
     A Global Multi-disciplinary Perspective, Cheltenham: Edward Elgar.

van der Hoeven, R. (2012). ‘MDGs post-2015: Beacons in turbulent times or false lights? A contribution to the discussion
     on a post-2015 Framework for Development’, UN-DESA Working Paper. New York: United Nations.

About the authors

Rolph van der Hoeven, International Institute of Social Studies of Erasmus University.
Peter van Bergeijk, international Institute of Social Studies of Erasmus University, and CERES-University of Utrecht.

WIDERAngle newsletter
June July 2012
ISSN 1238-9544

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