Asia-Pacific At A Crossroads Considers The Way Ahead

Published by: Asian Tribune

Date: 02 March 2009

Bangkok ( Many believe that decades of talk about development and the thousands of times on models of development that have emanated from international organisations and development institutions the world is indeed a far better place to live in today.

There is doubtless some truth to this. Some countries have made giant strides in some aspects of development. Others have lagged behind though they too have made progress in their socio-economic development.

But if making poverty history, as one western leader famously said, is the real goal of development then we have a long, long way to go. In fact in some regions of the world millions of new people have slipped into poverty in recent years, including in Asia-Pacific.

That is hardly the picture one would like to see at the end of the first decade of the 21st century and just five years before the target date for the achievement of the Millennium Development Goals.

So what happened to the billions of dollars spent in talking and writing about development and all the theories, great theories emanated from well-established world and regional bodies?

Have the hours spent on talking and the sleepless nights spent mulling what was discussed during the day, all been in vain?

Consider some figures. An additional 35-40 million people in the Asia-Pacific region will be reduced to poverty due to the recent international financial turmoil which is another western contribution to world crises.

Some three million children in this same region die before they reach the age of five years.

The latest data from the UN’s regional commission based in Bangkok, shows that some 1.3 billion people in rural Asia do not have basic sanitation. That is 70% of the world’s total.

Around 98 million children under five years old are malnourished. That is 70% of the world’s children in that age group.

Here is another figure is case you take these statistics lightly. Around 406 million rural residents in this region are without access to safe drinking water. It does not need some highly qualified medical scientist to explain the consequence of that.

But just in case you missed the implications it means greater incidence of bowel and other diseases and hence a huge burden on depleting and meager health services at enormous cost to the respective states.

Some of these figures have been known some of them (and more) are more recent. Repeated they must be even if known, for all too often governments, officialdom and indeed the people tend to forget them or dismiss them as they are not immediately affected.

Yet what is not often noticed, though some including United Nations agencies keep reminding us, is the paradox that is Asia. While we dwell on these disturbing data, as indeed we should, there is the flip side to the coin as it were, which is not often mentioned.

That is the strengths and resources the Asia-Pacific possess despite the socio-economic disparities that the region has suffered from over the years.

It has been double whammy in a sense for the region. A decade after its own financial crisis serious affected some of its own economies, it was hit in the last three years by what Noeleen Heyzer, the Executive Secretary of the UN’s regional arm, ESCAP calls the “triple crises” and I call the “three Fs”- food, fuel and financial.

The Asia-Pacific paradox is this. While having most of the world’s highest population and poor people and suffering from multiple socio-economic problems, it has built up huge financial reserves.

Noeleen Heyzer told me during a chat I had with her the other day that the reserves amount to US$4 trillion. But much of this capital has ended up abroad, I understand, propping up western economies in the way of foreign bonds etc while cash-strapped Asian-Pacific nations have to resort to IMF or commercial borrowings to meet their development needs.

Such enormous financial reserves should rightly lead to two developments. One is the diversion of part of the funds at least to intra regional development. There are several areas and sectors that seem starved of attention and finance.

Speaking at a recent policy dialogue among Least Developed Countries (LDCs) in Dhaka, Bangladesh, the ESCAP Executive Secretary referred to another paradox that haunts the region.

She said that the Asia-Pacific region produces more food than it needs. Yet ESCAP discovered three years ago that 45% of children under the age of five in South Asia were underweight- more than in any other developing region.

“Let me emphasize here that the present food crisis has it roots in the long neglect of agriculture during the past two decades,” she told the Dhaka participants.

“… while income support to farmers in the developed countries went up from about $299 billion in the late 1980s to some $365 billion in 2007, developing countries progressively withdrew their support to their agricultural sector as part of market reforms.”

Though Ms Heyzer does not say it in so many words, the reason for the neglect of the agriculture sector appears to be rather clear.

Asian countries which have had to resort to IMF loans or World Bank assistance to buttress their development projects have had to undertake market reform possibly at the behest of these institutions in order to qualify for the assistance.

The conditionalities imposed on recipient states would have required governments to turn away from agriculture to other areas of activity.

It is not simply the huge reserves available with the Asian region that makes Noeleen Heyzer particularly enthusiastic over building the numerous capacities that exist here but are still to be tapped.

As even a short conversation with her would show she is an ardent advocate of intra-regional “connectivity”. Though the word “connectivity” has now entered the jargon of the United Nations and civil society, not to mention some political circles, it is a word I would rather do without though I know what it means.

Somewhere in one of her speeches Noeleen Heyzer speaks of the “contagion” that has spread to Asia and affected the region. She was referring to the more recent financial crisis that originated in the West and spread eastwards.

I might use the same word in reference to her but in a far more positive sense than she was wont to use.

Ms Heyzer’s enthusiasm is contagious. Hardly had I been able to ask the several questions that I had tentatively lined up when her face lit up with a smile and she played terminator. End of interview- she was off to another meeting and who knows where or in which country in the region.

But I must say I did manage to get her to speak with her usual energy on a matter that she herself had made brief reference to a week or so ago.

Speaking here in Bangkok at an ESCAP meeting she said that Asia-Pacific must work towards “true regional cooperation”. Naturally I latched on to the word true.

Does it mean that the region lacks true co-operation? What has happened to all the talk over the years about regional co-operation, was it all rhetoric?

Of course not, she says emphatically. There is indeed co-operation even through such sub-regional groupings as Asean. Then there was the Chiang Mai Initiative that emerged after the Asian financial crisis over a decade ago. There is also the Mekong Committee, all examples of regional co-operation.

But now Asia that has gone through multiple crises is rethinking and re-setting itself. The previous models of growth are outmoded and globalization cannot be a force of growth. New drivers need to be found.

“The region cannot be dependent on export-led growth. That is not sufficient. It cannot be dependent on US and European markets,” she says.

So Asia-Pacific has to look inward at itself as a region and see how it can further improve co-operation among the member-nations that would substantially lessen dependence on the developed countries.

There are numerous areas in which this can be done from establishing an Asian monetary institution to infrastructure projects such as the Asian Highway, trade and technological co-operations.

The monetary fund was an idea that had been broached over 10 years but was shot down in flames.

Ms Heyzer seems somewhat reluctant to discuss the reasons for this-quite understandably perhaps as an UN official- but those who have studied developments in this region know by whom and why.

Western nations that have a stranglehold on the IMF did not want to loosen their grip on the developing countries when they have to seek IMF assistance. Major western powers were seen to be pushing their own agendas through the IMF and this power would be lost if Asia set up its own monetary institution.

Moreover with the rise of the Asian century as some predicted, the West feared the emerging political and economic power of the Asia-Pacific. So the Asian Monetary Fund collapsed and was knocked down like the twin towers.

But now Asia has risen like Lazarus. Yet Ms Heyzer finds that Asia is somewhat reluctant to assert itself and take a leadership role that it is entitled to as a global power.

She admits that Asia, given its diversity and national agendas will not be able to speak in a single voice on all global issues. But speaking as single nations in gatherings like the G20 does not carry the weight that these nations would if they spoke in a collective voice.

However there are issues on which some of the Asia-Pacific nations could speak with a coordinated voice on international forums that would considerably strengthen their stance rather than if were to speak as individual nations.

Her recent interactions with the region’s Least Developed Countries and the Small Island States of the Pacific have shown that such coordinated voices could be constructed if these members have the will to prevail.

What Noeleen Heyzer aims to achieve are, broadly speaking, two-fold.

Firstly to enhance regional co-operation in a variety of fields and so make the Millennium Development Goals achievable and set the region as a whole on the path to progress.

Then, strengthen the power of the region by building a collective voice to be heard and listened to on the global stage, a voice that those who once held the monopoly of political and economic power cannot but take cognizance of on important global issues such as climate change, restructuring of financial institutions and trade.