Today’s developed countries used a broad range of economic approaches in their own development strategies.

The current success of China, India, Brazil, and certain other developing countries is because they chose national strategies appropriate to their own conditions rather than economic policies prescribed by those who drive today’s globalisation model.

A government should design and implement a national development policy taking into account its country’s unique conditions and characteristics.

The state’s continuing role in supporting sustained capital formation and productivity increases, improving public infrastructure, providing basic social services such as public education and health, must be recognised rather than being left to the vagaries of the free market.

One cannot speak of globalisation and its impact on development prospects without also speaking about the role of the international financial architecture in allowing its worst effects to strike developing countries and the least developed countries (LDCs).

Since the mid-90’s, the impact of financial crises has caused severe setbacks in economic development, reduced the scope for public investment in health and education, and increased poverty in the affected developing countries.

While countries from Asia, Africa, and Latin America were severely affected by the financial crises in the late 90’s and the early part of this decade, developed countires’ economies were barely affected.

In fact, the shocks dealt by the various financial crises to developing countries allowed Northern governments and corporations greater access to many of our economies as domestic Southern companies failed and developing country governments ran short of financial resources.

Global dependence

Global inter-dependence needs to be fostered in the context of a global co-operative governance framework. Since the 80’s, co-operative multilateral governance for economic development was sidelined in favour of approaches that institutionalise the economic dominance of developed countries.

Public institutions controlled by developed countries, like the World Bank, IMF, OECD, and WTO became tools for international economic policy advice and control, while the core global economic governance institution with universal membership, the United Nations, was gradually marginalised.

Also it must be emphatically stated that reform of national policy and institutions is critical to their beneficial integration into a fair globalisation process. There must be good national political governance based on a democratic political system, respect for human rights, the rule of law, and social equity.

Decisive moment

This is a decisive moment for LDCs to commit themselves to a strategy of depending on themselves to reduce poverty.

This requires the integration their various diasporas into resource mobilisation plans, implementation of programmes that liberate the poor through property rights reform, and the formation of new links with other nations of the South, particularly the newly industrialising economies like India, China, and Turkey.

LDC governments need to focus on learning more from those whose history and developmental experiences most closely resemble their own, Asia in particular, and the reforms in the investment climate that have transformed India and China into today’s economic powerhouses.

LDCs must re-direct resources to build infrastructure, integrate markets, and promote regional trade. Intra-African trade for, example, is only 12 per cent of total trade, the lowest of all regions of the world. LDCs must invest in agriculture and aggressively support small and medium scale-entrepreneurs.

Some of the imbalances of globalisation and challenges of development are better addressed in a regional context. Regional integration should therefore be pursued as an agent of fair global economic integration.

Additionally, strong regional policies and institutions are important elements in improving governance of the global economy. How can we not learn from the power of the European Union in determining the course of international economic relations?

(The writer is a former President of Tanzania.) – IPS