Co-operation must be rooted in policy dialogue

At the dawn of the millennium, the world of the South was unimaginably different from what we see today. In 2000 the debate on global economic governance was firmly situated in the G-8. The WTO was seen as parochial, yet joining it was inevitable, given the seemingly unstoppable march towards openness and globalisation. The Washington Consensus was applied in exacting detail across the globe.

The governance structure of the International Monetary Fund and the World Bank were closed. China was a source of cheap labour and new markets. Turkey, India, and Brazil were seen as poor economic performers with little political voice. There was no African voice on the landscape. The Small Island developing States (SIDS) were seen as special cases, peripheral to the global dialogue.

The debate on development co-operation was benchmarked by the Millennium Declaration and the Millennium Development Goals (MDGs). The declaration receded, the goals and the derivative indicators became part of the business process of development. ‘Good policies’ were defined in Washington and enforced by requiring that countries design Poverty reduction Strategy Papers (PRSPs) complemented by an IMF-run Poverty Reduction and Growth Facility.

Own PRSPs

In a bizarre leap of thought, countries were to ‘own’ their PRSPs, the very instruments that bound their policy space. Even asking how countries would exit from aid-financed strategies to secure the MDGs and onto a long-term path to economic sovereignty was heretical.

Today, what a difference! A number of developing economies are seen as global players. Regional bodies like the African Union and Mercosur have been demonstrably effective. The WTO has seen an enhancement in voice and the principle of consensuality. The SIDS have made their voice felt, in Copenhagen and beyond. Countries in need of fiscal and technical assistance have a wider range of choices. All this has initiated the quiet demise of the condionality-based ‘good policies’ paradigm. The success of social programmes such as Bolsa Familia and Opportunidades in Brazil and Mexico, and the NREGA in India have made social protection the flavour of the year in donor circles.

If all this signals a renaissance in the global South there will surely be a renaissance in South-South Co-operation (SSC). But what will be the content of this renaissance? SSC was rooted in a deep historic engagement within the global South and the belief that political solidarity, in a politically and economically unequal world, was a sine qua non for securing development. This policy dialogue within the South was complemented by exchanges of technologies, skills, and resources.

There is an emerging view that because of the changes in global discourse, the imperative of political solidarity has given way to that of enhanced economic and technical co-operation, which the developed countries can join in a harmonised triangular arrangement.

It is true that post-crisis, the process of rebalancing the global economy has led, at the margin, to more participation in global institutions by some southern countries. But this is a concession, not a shift; it does not imply any diminution in the need for political solidarity within the South and the consequent need for policy dialogue to determine the future course of global economic governance.

In fact, the onus is even more on the members of the new groupings of economic governance like the G20 the IBSA and the BRIC to make such policy dialogues relevant to the global South and to demonstrate through their actions that their increase in voice and agency, including in the councils of the Bretton Woods organisations, is making a difference to all the countries in the global South. SSC will then derive shape and form from the policy dialogue and will make a difference, not to outputs but to outcomes like social justice and economic empowerment. It is here that the game must be stepped up to take seriously the Millennium Declaration and not just its technocratic content embodied in the MDG goals and indicators. It is here, and not in the empty rhetoric of ‘best practice’, so beloved of development professionals, that the required paradigm shifts in the discourses on trade, environment and human development will make a meaningful difference. And South-South co-operation, like all development co-operation, must be at the centre of these endeavours, rather than falling, as it often has in the past, into a technocratic quagmire that promises much but achieves little.

IPS