Development Versus Anti-Development: Your Choice Matters

By: Sabrina Singh

Given the immediate relevance of development policies to everyday life, it is not surprising that the idea of development is also a site of political contestation. Your choice to engage or disengage—and in what manner—implicates you in this politics.

The city of Kathmandu in my home country Nepal had been reeling with protests by local ethnic communities against the government’s road expansion development project for several weeks. The debate is framed as follows: On the one hand, there are the ‘developers’—political and technocratic leaders who have inherited a country sick of political turmoil and hungry for economic growth. On the other hand, there are the ‘anti-developers’—a mixture of ethnic minorities and heritage conservation activists skeptical of easy claims to development. The former want to build roads; the latter do not want to concede their land and heritage to development projects. The stakes are high on both sides.

Although these protests are triggered by recent events, they are not new. Development is a living, breathing phrase in places like Nepal and has been since the post-World War II global order. The Nepali word “bikaas” simultaneously means progress, in a normal sense of the word, as well as “development,” in the sense of the institutions and policies that make up this global governance system. It is as much a word of everyday parlance for many Nepalis as it is a career choice for many in the West and elites of the Global South. But leaving aside a debate about the merits of this particular policy, what do these protests and rhetorics reveal, and what do they mean for young students and practitioners on this side of the Atlantic?

 

To The ‘Developers’: Development For Whom?

My seventy-something-year-old grandmother has lived in the heart of Kathmandu valley all her life, as did many of her ancestors. She is a Newar woman, of the ethnic group protesting against the government’s infrastructure projects. Like many other Newari women, she has watched the ancestral land beneath her get parceled out to her husband and his brothers. She has watched as these lands were sold; as fallow fields were used for new buildings, roads and settlements. For her, land is not just land. It is tied to her community, identity, her sense of pride and dignity.

It may be tough for some of us to understand, and I myself have struggled at times to recognize, but development can never be justified for development’s sake. Development decisions leave tangible marks on people’s identity. Resources are not merely assets to be ‘used,’ but they are markers of relations and historical identities. And because of this, there are always winners and losers to every development decision, policy, or law. Because of what is at stake, an analysis of equity and justice must figure in every economic development decision.

I want to go one step further and argue that an analysis of equity and justice must figure in the very career choices we make as emerging lawyers. For many of us reading (or writing) this article, we can afford to switch these conversations on and off. Those whom we ostensibly aim to serve (or at least affect) through our work are ‘out there.’ Over time, it may be easy to forget that our choices matter. By ‘choice,’ I refer not to that between a “public interest” job in an INGO or a “private practice” job at a law firm. Those categories might hide as much as they reveal the state of international development and law.

Rather, I want to ask questions about our own choices in the way we approach each of our engagements internationally— some of us, for example, think we have to work in a developing country for one summer, others think we will ‘transition’ into an international social justice career. Is it possible that many of our choices are more about escapism than the people we want to ‘develop’? Is it possible that we are looking at international development as a ‘career,’ or a path of least resistance, rather than as a practice that affects everyday lives? Can we relentlessly strive for ethical and political practice in our international engagements despite the lack of answers on what that practice may look like?

 

To The ‘Anti-Developers’: Can You Work Past Neoliberalism?

However, this is not the time for disengagement and apathy. This is not an article about the many flaws or the eventual futility of international development. Let me start again with a story. Rupa Hitangi is a mother of two in a rural district called Palpa in Nepal. After years of working as a laborer in someone else’s farm and living with her alcoholic husband, she sent him to work in the Middle East. With newfound freedom and remittance sent home by her husband, she has built a small goat farm and vegetable business to support herself and her children. A self-made woman, she does not understand the complex system of international development, but her issue is basic: the right to make a decent living. This is the story of many in Nepal, most pressingly outside of the capital city of Kathmandu.

The need for basic economic security, poverty reduction, and higher income is real. It is irresponsible to say that the international development system is deeply flawed (see part one of this article), a product of neoliberalism, and then resort to cynical inaction. We need to be nuanced in our critique of the development concept, and part of the critique is to recognize our own power in this global neoliberal world order. Many who are critical are most often educated, young elites of the Global South like myself, who then resort to complete disengagement, apathy, or armchair theorizing. Many might even have worked in the international development field for a long time, and have suffered from cynical burnout. Many young Nepalis today find no saving grace in our government, politics, or youth movements. It becomes better to stay in a state of inaction in a foreign country than to go home to engage with such messy, tainted institutions.

What unites the ‘developers’ described above and these ‘anti-developers’ is the same lack of ethical and political engagement with this (neoliberal) world order that we are already positioned in. To this group of ‘anti-developers’, I ask: what claims to an ‘authentic voice’ of developing countries are we making? How can we build strategic practice and communities that can change entrenched institutions? In a practical sense, can we take that risk to work in and against messy, tough places like the government of Nepal?

 

A Call for Critical Engagement

In identifying myself with both groups, I am highlighting the need for a dialogue with both sides of the debate. We need to build teams capable of approaching places like Nepal and other places of the Global South as neither destinations for career-building escapism nor doomed places to flee from, but as spaces that deserve a more genuine, critical, and justice-oriented engagement.

At the personal level, this means investment in critical self-reflection about one’s professional identity and purpose. At the institutional level, we need to invest more resources to support collaborative, two-way work between the Global North and the Global South. At the societal level, this means healthy shifts in who occupies positions of authority and power. Complete inaction or siloed innovation won’t do – a critical change in everyday practice is what we need.

 


About the blogger: Sabrina Singh is a rising 2L from Kathmandu, Nepal.

Follow Harvard Law and International Development Society on Facebook and Twitter (@HarvardLIDS).

LIDS Symposium Blog Series – Businesses that Alleviate Poverty

By: Peter Vincze

During Panel 1 of the LIDS 2017 Symposium, Kevin Saunders, Lizzie Merrill, and Eric Solomonson shared their insights on diverse initiatives and approaches of four companies with the common objective of alleviating poverty. Accion International is a non-profit organization that aids microfinance institutions rendering financial services to low-income clients all across the globe. Ignitia and SeKAF are two Ghana-based NGOs that produce hyper-local, high-precision tropical weather forecasts and shea-based products through environmentally friendly and socially inclusive methods, respectively. One Acre Fund offers asset-based loans and agricultural trainings to eradicate poverty through the support of small-scale farmers in East Africa.

One of the most memorable points of the hour-long discussion that Kevin Saunders raised and Lizzie Merrill and Eric Solomonson echoed elaborated on the triple challenge (capital, channels, and data) lending institutions face in the international development arena.

The capital challenge stems from the fact that the level of demand for capital influx at the community level hardly ever equals the niveau of capital supply provided by lending institutions. The shortage of supply chiefly attributes to the fact that aid agencies themselves often struggle with obtaining and maintaining a constant influx of capital to their reservoirs that can later be allocated to their clients. Steady investment and working capital are however indispensable, especially for microenterprises and SMEs, to establish and/or expand their business activities, leading to a gargantuan demand for capital. As the traditional way to satiate this need through the philanthropic community is no longer satisfactory on its own, alternative, concerted ways need to be sought to ascertain proper funding for lending institutions.

The challenge of channels refers to difficulties of aid agencies in reaching individuals and businesses in developing economies that strive for access to financial services. Financial services are unavailable in many rural and even urban areas and, even if they are present, associated costs hinder accessibility. Main obstacles for lending institutions in these contexts are enhanced transaction costs, paucity of traditional collateral and basic requirements for financing, as well as geographic vicinity. Dearth of access to financial resources is a key impediment for entrepreneurs who possess the ability and required skills, as they cannot translate their deftness into sustainable outcomes. They are prone to resort to non-formal financing like moneylenders (“loan sharks”), traders, or even relatives and friends, and other high-risk financing mechanisms that further inhibit the operation of aid agencies. Cell phones and other technological developments can eventually mitigate challenges; access to these technologies is however also scarce, leading to a vicious cycle.

Accurate and comprehensive data is the sine qua non to evidence-based, responsible decision-making. Access to veracious and actionable data is particularly challenging in the development arena where data collection and reporting face numerous obstacles and can easily be hijacked for economic and political gambits. Among the numerous factors that impede or constrain data collection In developing contexts are low propensity of respondents, low standards in bookkeeping, deficiencies in law and order, rapid institutional alterations, size of informal sectors, and cultural constraints. Even in the unlikely scenario that data is reported accurately and fully, access to statistics, especially for non-public entities, be it large or small in size, is laborious and costly if not impossible. Asymmetrical and/or incomplete information poses risks, as institutions are unable to make optimal decisions vis-à-vis credit, inventories, clients, etc.  Technology, through the collection of mobile and satellite data, again has the potential to yield a breakthrough; however, dearth of access to such, in this context as well, perpetuates the issue.

While smaller donor agencies are more prone to the above-mentioned challenges, no lending institution is exempt from them, regardless of size or prevalence. My personal experience draws me to the World Bank, which constantly seeks solutions for all three issues.[1] The Bank’s coquetry with blockchain technology is one emerging approach to find remedies to the channels challenge. The recently launched Development Data Hub with provision of easily accessible and accurate development statistics aims to mitigate data challenge. The Bank also endeavors to tackle the challenge of capital, which, I would aver, is the most alarming in the current development policy landscape, with alternative ways of financing. Let me elaborate.

Funding of the World Bank (IBRD and IDA) relies on direct contributions of member countries.  Every member state renders a certain amount of initial capital to the institution upon accession that can later be expanded. Voting power of member states depends on the amount of contribution the country has made. Share allocation as well as voting power differs in IBRD and IDA.

In addition to bond issuance on international capital markets, IBRD relies on contributions from its 189 member states. IBRD’s capital stock has to be intermittently expanded through capital increases to replenish accounts drained by accelerated disbursements and/or to expand operations. A roadmap for the most recent general capital increase was assented to during the 2015 Annual Meetings in Lima with a decision to be made during the 2017 Annual Meetings. Owing to the change of the U.S. political landscape, the kismet of the general capital increase is however currently uncertain. During the 2017 Annual Meetings, U.S. Treasury Secretary Steven Mnuchin, representing the largest shareholder of the World Bank, rejected the idea. Instead, he urged the institution to transform its operations to effectively reallocate its existing capital and gestate a framework that would allow a financially self-sustaining Bank.

IDA capital replenishment occurs triennially. Within the framework of the past IDA replenishment, IDA 18, member states have made the most ambitious set of commitments to date with a historic $75 billion replenishment package that transforms IDA’s financial model.  Despite the unprecedented pledge, IDA’s future is currently irresolute, as the Trump Administration is rolling back several Obama-era commitments. In an effort to secure IDA finances, the institution has commenced penetrating capital markets through bond issuance for the first time in its history despite lingering criticism.

The future seems to be brighter though than one would think. Even if traditional financing sources are reconsidered, new emerging international development actors seem to be willing and able to step in to finance lending institutions as well as development projects directly. China, India, Russia, South Africa, Turkey, the Arab donors inter alia have for years been enhancing their efforts to fill potentials vacuums through unilateral, bilateral, and multilateral initiatives.  China, for instance, has recently increased its contribution to the Bank from 2.77 percent to 4.42 percent to become its third largest shareholder. In addition to state actors, the burgeoning of a heterogeneous smorgasbord of non-state actors can also be witnessed in international development circles ranging from philanthropic foundations (e.g. Bill & Melinda Gates Foundation), to global funds (e.g. The Global Fund to Fight AIDS, Tuberculosis, and Malaria) and enterprises engaging in corporate social responsibility.  These private actors not only bring a new set of perspectives to the table, but may also be financial heavyweights in particular sectors or regions. In this context, the work of organizations such as Accion International, Ignitia, SeKAF, and One Acre Fund is more salient than ever. Not only do they work to persuade the commercial world to penetrate the development arena, but also they seek to foster social inclusion, impact investing, the provision of management services and technical assistance, inter alia that will all assuage the triple challenge of capital, channels, and data.

[1] The term ‘World Bank’ refers to the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA).  The World Bank Group comprises of five institutions:  International Bank for Reconstruction and Development (IBRD), International Development Association (IDA), International Finance Corporation (IFC), Multilateral Investment Guarantee Agency (MIGA), and International Centre for Settlement of Investment Disputes (ICSID).  This analysis merely focuses on the World Bank.


About the blogger: Peter Vincze is a consultant on corporate governance-related topics at the World Bank. He aims to pursue further academic training in international development law.

Follow Harvard Law and International Development Society on Facebook and Twitter (@HarvardLIDS).

LIDS Symposium Blog Series – Faizal Karmali on Networked Approaches to Complex Global Problems

By: Seth Norris

Mr. Faizal Karmali (Associate Director, Network Engagement & Bellagio Programs, Rockefeller Center) gave the closing address at the LIDS 2017 Symposium. His speech highlighted the increasing importance of working across discrete global networks to effectively implement international development projects. Specifically, Mr. Karmali looked at the relative influence of individuals, government, civil society, and the private sector across the networks of capital, expertise and influence.

Mr. Karmali began his talk by noting that government and civil society are by far the largest sources of capital investment for international development projects. However, the contributions of these two groups is by no means equal, with the total giving of the top 50 NGOs still falling 6 billion dollars short of the budget cuts to USAID proposed by the Trump White House.

Next came a discussion of international networks dedicated to providing expertise for development projects, with government and civil society being cast as the predominate providers, given that funds directed to private sector consulting firms through USAID are still merely extensions of government backed development finance.

Finally, Mr. Karmali touched on influence networks, arguing that the government and private sectors have traditionally held the most sway. This influence can have both positive and negative elements, as Mr. Karmali highlighted by recounting the effect that US subsidies of ethanol production have had in increasing global food prices, partially contributing to the outbreak of events like the Arab Spring uprising in 2010.

Mr. Karmali concluded by highlighting several NGOs who have succeeded in working across networks to effectively implement international development projects, including  BRAC, the world’s largest NGO, and the Aga Khan Development Network, which currently has operations in over 30 countries.  By pursuing both non-profit and for-profit endeavors, these NGOs have been able to dramatically increase the effectiveness of their development projects by pooling resources across the networks of capital, expertise and influence. Mr. Karmali ended his remarks by encouraging those in attendance, whether they aspired to work in international development or not, to consider what they might do to further international development goals around the globe.


About the blogger: Seth Norris is a member of the JD Class of 2019 at Harvard Law School. Before coming to Harvard, Seth earned his B.A. in East Languages and Literature from Yale University.

Follow Harvard Law and International Development Society on Facebook and Twitter (@HarvardLIDS).