Security and development: the Millennium Goals

Phil Goff Speech to the Otago Foreign Policy School, Otago University
The theme of this year's Otago Foreign Policy School brings together two of the greatest challenges facing the world: security and development.

United Nations Secretary General Kofi Annan has emphatically reminded us of that in his challenging report, entitled 'In Larger Freedom': “We will not enjoy development without security, we will not enjoy security without development, and we will not enjoy either without respect for human rights.”

His report is about addressing security and development challenges, and about reforming some of the principal organs of the UN, including the Security Council.

This year could, indeed should, be a watershed year for the UN and the global system. Five years on from the Millennium Summit and the establishment of the Millennium Development Goals (MDGs) we are at risk of failing to meet the 2015 targets in too many countries and regions, including the Pacific.

In a post 9/11 environment we have been mesmerised, not unreasonably, by global security issues. Terrorism is an important issue but addressing its causes is as important as suppressing its symptoms. One cause is the alienation of those deprived of decent living standards and of hope. Meeting the poverty gap and development challenges are complimentary to meeting the challenges of political security.

Today: One billion people, one-fifth of the world's population, live in extreme poverty, and 800 million are under nourished; 100 million primary school-aged children, 60 per cent of whom are girls, are not at school; 11 million children under five die each year of preventable causes; and, Life expectancy in the poorest countries is as low as 40, nearly half that of the life expectancy in our country. The existence of the poverty gap is a moral affront as well as a contributor to insecurity and a lost economic opportunity for masses of people.

In September 2000, the UN General Assembly ended on a historic note, with the adoption of the UN Millennium Declaration.

The Declaration, covering human rights, security, peacekeeping, the rule of law, and the environment, also collectively committed governments, including our own, to work towards freeing the world of extreme poverty and international development goals.

The MDGs reflect unprecedented international consensus to close the poverty gap. Never before has the global system set goals and timelines to address poverty in its many manifestations:

Halving the number of people living on less than $1 per day; Halving the number of people suffering hunger; Achieving universal primary education and gender equality in education; Reducing infant mortality by two thirds; Reducing maternal mortality by three quarters; Halting and rolling back HIV/AIDS and malaria and other major diseases; Addressing key environmental sustainability issues; and, Developing a “Global Partnership for Development”, including freer, fairer and more open trade, more and better Official Development Assistance (ODA) and debt relief, and recognising the special needs of small states and the poorest.

The MDGs have considerable strengths: They provide a consensus vision of a better world, and motivate us collectively to realise that world; They are poverty and results oriented; They are quantitative, which helps countries and aid agencies evaluate, and then change, their policies and activities.

Although the MDGs provide clear and simple directions as to where we should be heading, the road itself is far from straight or easy.

Firstly, they are not comprehensive, and there is at least one area vital to the child and maternal health goals to which we need to pay attention, and that is sexual and reproductive health and rights.

Secondly, the achievement of the MDGs will depend on a complex of factors, and a multiplicity of actors: global economic performance, the international trading environment, the quality of governance and of policy in developing countries, the volume and effectiveness of ODA.

Thirdly, there are challenges about priorities, since not everything can be done at once.

Indeed, while the MDGs are all quite inter-related, development experience suggests a first priority is basic education, especially for women, as that makes an essential contribution to improved health status for families and children.

Education is also essential for progress on reducing income poverty. New Zealand is prioritising the rebuilding of the basic education system in Solomon Islands, for example, for these very reasons.

New Zealand has reprioritized basic education as a component of overall educational aid, moving it from five per cent of expenditure in 1999 to 31 per cent today.

The right approaches are also essential to achieving the MDGs. No development is effective, or sustainable in the long run, unless it is locally owned. The development strategies for setting priorities and achieving the MDGs at country level must be nationally led and nationally owned to be effective.

Where there is a regional dimension, for example in the Pacific, good regional cooperation is essential. That is one of the reasons why New Zealand is a strong promoter of the Pacific Plan being devised by Pacific Island Forum countries for greater cooperation and integration.

Another vital area is governance, which is not in itself a MDG, but is critical to the achievement of them.

Governments that have the interest of their people at heart, and which avoid the cancer of corruption, will emphasise such matters as the provision of basic services to the people, and the creation of a policy environment that encourages economic activity and attracts investment.

Poor governance, on the other hand, is generally a rapid route backwards into poverty, especially if civil conflict is also a factor. Papua New Guinea, Solomon Islands, Afghanistan: each is a case in point.

However, New Zealand does not consider that poor governance is a reason to disengage from fragile states. Rather, we should be tailoring our engagement to address the problem, for example by focusing on strengthening the capacity, transparency and accountability of government systems.

This type of approach is highly relevant to some of the fragile states in New Zealand's own neighbourhood.

Jeffrey Sachs’ Millennium Project Report released in January gave us a useful read-out on progress of the developing world against the MDGs.

East Asia is largely on track for most goals and, with the economic growth rates following adoption of market economies, and policies targeting poverty in India and China, millions of people have been lifted out of poverty. That is the main contributor to the world having halved the 1990 level of income poverty, on a population basis, already.

But sub-Saharan Africa is off track against most goals. And after sub-Saharan Africa, the sub-region most off track against the MDGs is the Pacific.

Statistics from some of our neighbours in the Pacific paint a grim picture: In Vanuatu more than 66 per cent of adults are illiterate; Over 16 per cent of people in Kiribati are not expected to survive to the age of 40; Papua New Guinea has the lowest living standards, the lowest average life expectancy, and the highest maternal and infant mortality rates of any country in the Pacific; and, More and more Pacific nations are beginning to live in the shadow of HIV/AIDS.

The Pacific is a region that New Zealand knows well and where we can make a real difference. NZAID, the government’s international aid and development agency, implements major bilateral and regional programmes there. The recently announced increase in our ODA funding is predicated on New Zealand aiming, in cooperation with partner governments, and donor agencies, at:

Ensuring every Pacific child has access to a good education; Helping reverse the growing incidence of lifestyle diseases and HIV/AIDS in the Pacific; Meeting the basic needs of Pacific communities through the provision of access to clean water, good sanitation and adequate healthcare; Improving the skills and knowledge of Pacific leaders and their officials; Fostering sustainable economic growth and improved livelihoods across the Pacific and Asia, including through trade and development; and, Contributing to regional and multilateral management of common challenges such as preparation and protection against natural disasters, and the pursuit of security and prosperity.

The following are a few specific examples of practical actions New Zealand is taking to contribute.

I have already referred briefly to Solomon Islands. Rebuilding the education system, in partnership with the government and the European Union, involve New Zealand contributing $30 million over three to five years.

We will be doing the same thing in Tonga, where there are better foundations but issues of access and quality of education remain – this time with the government and the World Bank.

In Papua New Guinea, we have been appointed lead donor, not in volume of aid, but for policy coordination for the combined donor input to the health sector.

I mentioned the importance of governance. We continue to make major contributions in the areas of improved policing and corrections, judicial and prosecutorial capacity, public sector reform and strengthening, and educating leaders.

Next month we will co-host with the University of the South Pacific, a major symposium on Pacific leadership: What is it, what state is it in, how can it be improved? The participants will be Pacific Islanders, not expatriates.

We contribute significant funding and expertise in areas such a trade facilitation and management of fisheries resources.

We recently provided $2 million to United Nations Children’s Fund (UNICEF) to help prevent HIV/AIDS affecting children in the Pacific through mother-to-child transmission.

New Zealanders, as revealed in an NZAID/UMR survey last year, strongly support New Zealand’s contributions to development in the Pacific. They recognise it is our home region and deserves our support.

To do that, and much else besides in other regions where we are active – Asia, Africa and Latin America as well as support for the UN system – the government recognises that increased funding is required.

The longstanding international target of wealthy countries assigning 0.7 per cent of Gross National Income (GNI) to ODA has been repeatedly reaffirmed, at the Millennium Summit and the Monterrey Conference on Financing for Development in 2002.

Many of the OECD donor countries have committed to significant increases in ODA, including interim targets on the way to 0.7 per cent. Total ODA projected for 2006 will be 28 per cent up on 2003 ($US66-83 billion).

In keeping with the government’s commitment to move to the 0.7 per cent as our resources permit, this year’s budget contains an increase of approximately $60 million to development assistance. This increase, of 23 per cent, will take New Zealand from 0.23 per cent to 0.27 per cent of GNI and a total ODA contribution of $380 million.

This is a small but significant step towards the target of 0.7 per cent of GNI. We will ensure that we hold at 0.27 per cent in 2006/07, and lift ODA to 0.28 per cent the following year. On current GNI estimates, that will be around $440m per annum.

The Millennium Development Goals also call for the international community to address the debt position of many of the world’s poorest countries. The cost of servicing what are in many cases unsustainable debt levels is a huge barrier to achieving the MDGs.

Although New Zealand has no bilateral debts to write off, we can, and will, continue to play a constructive role in multilateral debt relief initiatives. We have contributed over $6 million to the Heavily Indebted Poor Countries (HIPC) initiative.

I have welcomed the recent G8 Finance Ministers’ agreement on a new package of debt relief, effectively cancelling the multilateral debts of all eligible HIPC countries. We will be shouldering our share of the burden in respect of debt relief to poor countries owing debt to the World Bank and the Asia Development Bank.

Increased and effective ODA, and effective and sustainable debt relief are two of the key requirements if the MDGs are to be met.

Trade is the third pillar. A key priority is improving market access. To quote Kofi Annan: “No single change could make a greater contribution to eliminating poverty than fully opening the markets of prosperous countries to the goods produced by poor ones.”

New Zealand scores pretty well on this count, but, regrettably, the same cannot be said of some of the major members of the OECD.

Developed countries are distorting the opportunities for developing countries to trade in an area of their comparative advantage, agricultural products, by keeping markets closed and/or subsidising their own exports.

A recent Oxfam paper used rice as an example. Rice affects the livelihoods of two billion people – one third of the world’s population. Smallholder farmers grow around 90 per cent of the world’s rice. Rice is therefore vital for food security and rural livelihoods in many developing countries.

Unfortunately, the global trade in rice is highly distorted by subsidies paid to developed country farmers. The US is currently the third largest rice exporter in the world but each tonne costs an average of $US188 to produce, two and a half times as much as in Thailand and Vietnam. US farmers remain in business because their government pays out $US1.3 billion in subsidies to the sector (2003 figure).

This subsidised rice is then “dumped” on markets in countries like Haiti and Ghana with devastating consequences for the livelihoods of rice growers in those countries, particularly women who tend to be more involved in the cultivation of food crops.

While the report focuses on rice, the same arguments apply to crops such as cotton, soybeans and wheat. The European Union, as well as the US, has been a major contributor to this problem.

OECD countries currently expend around $280 billion a year on subsidising agricultural exports. This is more than three times the level of development assistance, around $80 billion a year, that these countries provide to the developing world.

The WTO Doha Development Round is critical to addressing this situation and New Zealand is playing a critical role. We need to secure improved market access including for developing country products and we need to see export subsidies eliminated. I applaud the EU's agreement last year to eliminate export subsidies on agriculture. That is a huge step forward.

I have touched on three main inputs to achieving the MDGs: aid trade and debt relief. There are others.

Remittances, estimated at $US126 billion in 2004, are very important for some countries such as India and the Philippines, not to mention Samoa and Tonga. Samoa and Tonga gain 21 per cent and 41 per cent respectively of their GNI from remittances. The challenge here is to harness at least some of the flow for development purposes.

Private capital flows, much of it as investment, is also a large element, estimated at $US301 billion in 2004.

And then of course there is the opportunity forgone of increasing spending on development that might accrue from reduced military spending, which is currently estimated at $US997 billion per year.

In September this year the world will return to New York for the Millennium plus 5 Summit. Leaders will be looking at more than progress on the MDGs.

They will be looking at proposals to reform the UN, and at strengthening aspects of security and human rights. This, as I said at the outset, could, and should, be a watershed meeting.

While substantial UN reform will be far from certain, we need to make progress on some of Kofi Annan’s key proposals such as the Peace Building Commission and updating the Security Council.

Above all, however, world leaders must reaffirm the vital importance of an effective multilateral system, with a strong United Nations at its core.

Only then can we hope to address effectively the challenges and threats confronting us in this century, and to achieve progress in the inter-connected areas of development, security and human rights.

Only then can we hope to succeed in tackling world poverty and enabling millions of poor people to be able to reach their full potential.

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