DEVELOPMENT: UNDP Urges More Investments in Global Assets

By Thalif Deen Reprint | | Print |

Thalif Deen

UNITED NATIONS, May 10 1999 (IPS) - Some of the world’s major crises – financial, environmental and humanitarian – could have been averted if governments invested more in the management and protection of global assets that benefit all of humanity, according to a study by the UN Development Programme (UNDP).

Such assets or “global public goods” include the environment, human rights, market efficiency and public health.

“Policies that negate or neglect their importance imperil all of humanity,” says the 546-page report “Global Public Goods: International Cooperation in the 21st Century” released Monday. “So far, the world’s problems have attracted mainly quick fixes and patchwork policy responses.”

The study consists of a collection of articles by 29 development experts, academics and economists, including Joseph Stiglitz, Chief Economist of the World Bank, Amartya Sen, the 1998 Nobel Prize Winner for Economics, and Jeffrey Sachs of Harvard University’s Institute for International Development.

“Many of today’s international crises have their roots in a serious undersupply of global public goods,” argue the authors of the study.

These global public goods, according to the report, are designed to combat cross-border scourges such as disease, ignorance, poverty and pollution.

The report makes a distinction between global public goods and national public goods. The latter includes widespread education, national defence, social security, a national justice system and a clean and healthy environment – provided mostly by national governments.

The study takes the notion of public goods across national frontiers – to the global level. “After all, society has always been willing to spend money on public goods,” says UNDP Administrator James Gustave Speth.

He says that “we should be equally willing to pay for global goods that serve our common interest, be they shared systems of environmental controls, the destruction of nuclear weapons, the control of transmittable diseases such as malaria and AIDS, the prevention of ethnic conflicts or the reduction of refugee flows.

“And we should be prepared to finance such goods through innovative mechanisms based on the principles of reciprocity and collective responsibility, principles that go beyond the concept of official development assistance (ODA).”

The study says that global public goods increasingly are undervalued and mismanaged by institutions and governments.

Consequently, policies are needed to overhaul both national and international institutions in order to make them more effective and capable of responding to current global needs and challenges.

One of the requirements for producing or preserving effective global public goods is equity among those involved. The report recommends a number of ways to strengthen the negotiating position of developing nations.

These include the establishment of a Global Participation Fund and also expanding the influential, policy-setting Group of Eight (G-8) industrialised nations into a G-16 so as to include eight major developing nations.

The study also recommends the creation of a Global Trusteeship Council consisting of eminent personalities, to advise UN Secretary-General Kofi Annan, as and when international emergencies take place.

The proposed Global Participation Fund would be administered by developing nations and used to coordinate their policies and strengthen their negotiating skills. “It would also allow them to participate in international debates where they would not otherwise be heard,” the study notes.

The report recommends separating ODA allocations into two categories. One would be for national development; the other for global or regional public goods such as protecting the ozone layer, global forest reserves and bio-diversity, or to coordinate policies relating to free trade, financial markets, disease control and human rights.

Speth argues that a reformed and redirected ODA should help eradicate poverty through sustainable human development.

With the wealthiest 20 percent of humanity now as much as 135 times richer than the poorest 20 percent, and with poverty spreading in all societies, and especially in developing countries, there is an urgent need to increase the level of ODA.

“But poverty cannot be stopped if we do not have peace or financial stability,” Speth notes. “And sustainable human development cannot be achieved if we do not prevent conflicts, manage markets wisely or reverse the depletion of soils, energy, fresh water and clean air.”

Beyond ODA, “we therefore need a new form of international cooperation that embraces trade, debt, investment, financial flows and technology, and that includes payments and incentives to countries to ensure an adequate supply of global public goods.” Speth concludes.