Minister of Agriculture and Animal Resources, Republic of Rwanda 

As the Fourth High Level Forum on Aid Effectiveness in Busan, South Korea, commences, Rwanda has a chance to convey its way of doing business in an ever-changing aid architecture. The meeting centres on the Paris Declaration, a tool for donors and developing countries to hold each other to account.

Minister Kalibata. Credit: Jon Amira/IFAD

In Busan, a large and increasingly mixed community of development stakeholders will look back while seeking to outline the future of aid. Rwanda’s experiences are particularly valid for discussion in Busan. Rwanda’s story of aid effectiveness is one of strong leadership and meeting the challenges faced in managing developmental assistance.

President Paul Kagame’s lead, vision and ownership have allowed Rwanda to stay focused. In the agriculture sector, over the past four years, Rwanda has received strong support both from aid multilaterals and bilateral. Emerging countries such as India and Brazil have begun to provide public and importantly private sector investment in the country, to new cross-cutting funds such as those for Climate Change.

The years have been characterised by turning these investments and support into food security and poverty reduction for Rwandans. Rwanda has moved from a food insecure country with 20 out of the 30 districts, labelled food insecure by FAO standards, to a food secure nation with no single district below the required food needs.

In August 2007, Rwanda initiated the Crop Intensification Programme to increase both the levels of production and productivity amidst the various challenges that Rwanda faces. Key pillars of this effort include land consolidation, input access, reduction of post-harvest losses and access to markets. The programme ensures that every farmer, however small, has access to improved seeds, fertilisers, extension and a market opportunity.

Rwanda’s yields have quadrupled in these four years. Today it stands as the only country in the region that survived both the 2008 and 2010 food crisis, despite inflating food prices.

In many ways Rwanda is a microcosm of the global future of agriculture – a world in which countries have to reach and maintain high food production in the face of decreasing arable lands, rising fuel prices, high population density and an increasingly volatile climate. For Rwanda in particular, these challenges will not go away. Therefore, to stand the best chance in developing the country and reducing poverty, how we do the business of development is paramount.

The meeting in Busan is a chance for us to share and learn how to improve this business. From zero tolerance to corruption to upholding Paris Declaration principles, Rwanda has much to contribute to the Busan meeting.

Rwanda is co-hosting a side event with the International Fund for Agricultural Development (IFAD) and the World Food Programme (WFP). These two U.N. agencies have supported Rwanda for a very long time.  Notably, both were among the first multilaterals to come to the assistance of Rwanda immediately after the 1994 genocide; WFP with immediate humanitarian assistance and IFAD with the much needed development assistance.

IFAD’s presence in Rwanda was not surprising given its strong and firm belief in the potential and power of the smallholder farmers not only to feed themselves but also to form viable business entities. Nowhere else in the world does the term smallholder farmer hold more meaning than in Rwanda.

IFAD has since supported thousands of farmers to establish meaningful business in coffee and tea. The agency has also supported smallholder farmers to establish integrated farm projects around the government initiated one cow per poor household project that has moved the farmers above the poverty line in a space of two years.

IFAD has supported Rwanda in institutional building, ensuring skill availability in the design and implementation of Rwanda’s strategic plan to transform agriculture.

More recently, IFAD has supported Rwanda’s move to food security by supporting the Crop Intensification Programme through development of irrigation schemes, access to inputs and improving farmer organisation.

Likewise, WFP has demonstrated a firm belief in the capacity and potential of the smallholder farmer. It has recently moved from food assistance to purchasing food from smallholder farmers through the Purchase for Progress (P4P) programme. This programme has probably had the most influence on mobilising farmers to ensure food security and also get them out of poverty through sale of surplus produce.

The confidence of both IFAD and WFP in smallholder farmer capacity as important market players is the future of food security in Africa.  We in Rwanda applaud the support to smallholder farmers; we applaud WFP for initiating the P4P programme.

END

Credit: Claudius/IPS

PARIS, Nov 1 (IPS) – Oxfam and major aid donors of the OECD’s Development Assistance Committee (the DAC) are often on opposite sides of the fence. Today though, we are on the same side —making sure that effective aid lifts people out of poverty.

The DAC represents government donors and promotes ‘better aid’. Oxfam’s job is to blow the whistle when the DAC fails.

Our joint appeal for more sanity in global development co-operation is a reflection of our shared fear that the world will miss an important opportunity to fix what is wrong. We are both looking to the November G20 meeting of major industrialised and emerging nations in Cannes and a few weeks later the High-Level Forum on Aid Effectiveness in Busan, South Korea to ensure that doesn’t happen.

With Western economies and political systems under tremendous strain, will it be more convenient to sweep the needs of the developing world under the carpet?

Our guess is that the G20 leaders in Cannes will understand that effective development can calm the volatile food and energy markets, alleviate climate and security threats, and give hope to the billions of people who are jobless or suffering from poverty, hunger, disease, and other injustices.

We trust that G20 leaders will give a mandate to the High Level Forum to create new and more effective global partnerships with developing countries, donors from developed and emerging economies, the private sector, and civil society organisations.

The current system of development co-operation is improving, but the process is too slow. Governments are still failing to follow through on the promises of more effective aid they made at previous OECD (Organisation for Economic Cooperation and Development) meetings. Some estimates indicate that about 30 percent of aid from all sources may be being wasted due to fragmentation and too little coordination.

Meanwhile, latest trends on reaching the Millennium Development Goals – eight time-bound targets tackling poverty and its various dimensions agreed by United Nations member states in 2000 – by 2015 show the world falling far behind.

Busan is an opportunity to mend the tattered global effort. The evidence compiled by the OECD shows clearly that when donors support developing country governments and people to lead their own national development agenda, the results are likely to have greater and more lasting impact on reducing poverty.

It also shows that most donors’ efforts are uncoordinated and too unpredictable. Oxfam has repeatedly called these failures to public attention, often using DAC’s analysis and data.

The agenda at previous High Level fora on development has been donor driven, mostly by aid ministry experts. Thus the Paris and Accra principles were adopted (in 2005 and 2008, respectively), but without enthusiastic support from high-level political leaders of donor governments, nor by aid recipients and emerging economies. However, a robust monitoring process has now convinced the sceptics that making aid more effective requires new political energy and commitment.

The Busan forum is underpinned by two positive influences: the G20’s effort to elevate development as an issue, and developing nations’ demand for more effective aid and ownership of their own destinies.

Civil society is demanding to play its vital role in setting development priorities and holding governments accountable, as are parliamentarians and the private sector. Perhaps most importantly, the emerging economies who practice South-South Co-operation, and know poverty first hand, are increasingly interested, motivated by the G20 process and the participation of developing countries.

The G20 will soon consider recommendations on the nine areas (or pillars) of the Seoul Development Consensus. France is pushing leaders to address food price volatility and invest in infrastructure in the developing world. But good ideas may wither without effective implementation.

This is why it is all the more crucial that Busan participants continue the global monitoring and accountability effort that the OECD has been conducting since 2005. Busan should also be a push to rebuild the larger development community in a more rational, less fragmented, form.

As for Oxfam and the DAC, we will continue to apply pressure. Sometimes together, sometimes separately, but always with a common cause.

*Brian Atwood is the Chair of the OECD’s Development Assistance Committee and Jeremy Hobbs is the Executive Director of Oxfam International.

(FIN/2011)

JOHANNESBURG, Sep (IPS) — In the hope for a fairer deal on aid for the continent, African leaders are planning to present a unified position at the Fourth High Level Forum on Aid Effectiveness (HLF4) in Busan, South Korea.

Currently, discussions are underway between the African Union, New Partnership for Africa’s Development (NEPAD), and private sector and civil society representatives on how to improve the impact of aid for the most vulnerable and marginalised. The outcome of these discussions will then be taken to Busan in November this year as the ‘African Consensus and Position on Development Effectiveness’.

As 2000 high-level delegates and experts converge on Busan, to review global progress on the impact and effectiveness of aid, it is imperative that the needs of Africa take centre stage.  Present aid policies are failing Africa, as evidenced by the fact that 33 of the world’s 48 Least Developed Countries (LDCs) are on the continent. UN estimates of progress on the Millennium Development Goals show that Africa is lagging behind the rest of the world in reducing poverty. According to 2005 estimates, which are still quoted by experts, half the people in Sub-Saharan African live on less than UDS 1.25 a day.

Civil society is hoping for enhanced commitments in Busan from donor and recipient countries to set a new agenda for development that maximises the benefits of aid for those most in need. It is thus imperative from an African perspective that political leaders and senior government officials coming to HLF 4 reiterate their commitment to implementing principles agreed to in previous high level forums on aid effectiveness at Accra (2008) and Paris (2005).

At Busan, Africa needs developed donor countries to live up to their aid commitments and ensure the predictability of aid flows to allow recipient countries to plan for the future on the basis of aid that has been promised for development. Following the global financial crisis of 2008, a number of developed countries reneged on official development aid commitments by drastically slashing the amount of aid that had been promised, putting to waste the efforts of African countries who had spent considerable time and resources in formulating extensive plans for the utilisation of the projected aid.

Additionally, the failure of developed countries to allocate a minimal percentage of 0.7 percent of their Gross National Income to developing countries to meet their development goals through aid from abroad needs to be in the spotlight. This figure was agreed through a UN General Assembly resolution way back in 1970. Sadly, only a handful of developed countries have met this target in official development assistance while most fall woefully short of it.

Moreover, if official aid is to work, it must be de-linked from political or economic considerations of the donor government in keeping with the agreed principle of non-conditionality. This is a highly-contested issue as aid flows remain dependent on the strategic and geopolitical priorities of donor governments, including security concerns. It is an open secret that some LDCs in Africa have received more aid than others not on the basis of the actual needs of their populations but because of to their governments’ willingness to cooperate militarily in the global ‘war on terror’. There is a strong demand from civil society that conditionality be focused only on ‘development results’, including a commitment to the protection of human rights, social justice, and transparency.

From Africa’s perspective, while it is important to spur economic development on the continent, there is also an equally pressing need to re-orient global economic governance towards meeting the needs of the impoverished and the marginalised. The World Bank and the International Monetary Fund (IMF), from which many African states have borrowed huge amounts of money, continue to be governed by (and serve the economic agenda of) a handful of traditionally rich countries. Discussions at Busan cannot be divorced from reform and democratisation of international financial institutions whose work has a powerful resonance on the continent.

Another key principle of aid that has emerged from previous high level forums is that of ‘national ownership’. Many African states have sought to interpret this as ‘government ownership’, as evident in the proliferation of policy pronouncements and legislation to allow governments to maintain hegemony over aid money to the detriment of other stakeholders, such as parliamentarians who sit in the opposition, civil society, and local communities.

Since the last High Level Forum in Accra in 2008, a number of legal and policy restrictions across the African continent have been put in place to prevent civil society groups from demanding accountability from governments through provisions that restrict the advocacy work of NGOs and force them to bring their activities in line with national development plans decided by governments. The serious crisis of shrinking civil society space on the continent is exacerbated by the fact that many vocal civil society advocates exposing corruption and human rights violations are being intimidated through motivated prosecutions, threats, attacks on their reputations, and extreme physical violence.

There is also a worrying paucity of information from African countries regarding the impact that aid is having on the lives of the impoverished. This is linked to the lack of democratic institutions that can independently verify the actions of governments.

In Busan, the world cannot afford to fail Africa, and nor can African leaders. (END/COPYRIGHT IPS)

*Mandeep Tiwana works as the Policy Manager and Netsanet Belay works as the Director of Policy and Research at CIVICUS, a global alliance of civil society headquartered in Johannesburg.

WASHINGTON, Sep 2011 (IPS) —  The release on September 22 of the report “Aid Effectiveness 2005-2010: Progress in Implementing the Paris Declaration” leads us to ask an important question: Are we any better at delivering aid effectively today than we were five years ago?

The evidence from the survey is sobering. At the global level, only one of the 13 targets established for 2010 in the Paris Declaration on Aid Effectiveness have been met, and only by the narrowest of margins.

When over 100 donor and developing countries agreed to the Paris Declaration in 2005, they endorsed a set of principles formulated to address the major concerns in development at the beginning of the 21st century. They also committed to deliver -by 2010- on a series of action-oriented targets designed to ensure that aid money would produce better, longer-lasting results.

Independent evaluation has shown that the Paris Declaration principles have left their mark. They have been taken up as global norms of best practice, focusing divergent interests on common goals and concrete development objectives. In many cases and circumstances they have changed the way development is done, putting developing country concerns at the fore and raising expectations among all stakeholders.

All told, the past decade has been good for development. More than one-third of all developing countries have graduated into higher income groups. Global efforts to scale up aid have resulted in a 60 percent real increase in official development assistance between 2001 and 2010. Rapid economic growth in the first half of the decade has led to a sizeable decline in poverty in developing countries so that today, the first United Nations Millennium Development Goal (MDG) of halving the number of people living on less than USD 1.25 per day looks well within reach for 2015.

Yet despite these very positive changes, progress in reaching the specific targets agreed in the Paris Declaration is happening at a pace much slower than expected, and much more unevenly around the world than we had hoped. For instance, while many developing countries have met commitments to improve the way they manage public funds, many donors are still not using these systems.

It is clear that more is needed to meet today’s pressing development challenges.

The world has changed profoundly since aid as we now know it began some 60 years ago. Today’s development landscape is populated by fast-evolving realities. The past few decades have seen an explosion in the number of organisations and countries that support development, with middle-income countries and emerging economies increasingly providing development assistance directly, outside of the traditional models of the past.

Likewise, there are more and more non-governmental and civil society organisations, private foundations, and corporate players that are keen to make their mark on pressing global problems. And while these actors bring new funding, along with approaches and ideas that all can learn from, the playing field is getting crowded and the challenges faced by developing countries in managing them all are burgeoning.

In addition, transnational issues -such as health, security, employment, migration, food insecurity and climate change- demand a coordinated response and, above all, strong political will to address them.

In this landscape, working together has become one of the great -if not the greatest -challenge to producing positive development results and reducing inequality.

The upcoming Fourth High Level Forum on Aid Effectiveness (HLF-4) in Busan, Korea, later this year presents us with a unique opportunity. With only four years remaining before the MDG target date of 2015, this is one of the last remaining events to bring such a large and inclusive group of development leaders together. At Busan, they will have the chance to revitalise standing commitments, while laying the foundation for a modern, inclusive, and transparent approach to international development.

At Busan, we can forge a new global partnership for development that not only addresses the pressing challenges of the day, but also provides a blueprint for working together in true partnership on the challenges that we face going forward.

Development co-operation is only part of the solution; while it plays a catalytic and indispensable role in supporting poverty reduction and economic development, over time we need to reduce dependency on traditional aid-without jeopardising, or course, the well-being of the poorest people and countries.

This means to examine the interdependence and coherence of all public policies -not just development policies- to enable countries to make full use of the opportunities afforded by international investment and trade. We need to leverage the impact of the many sources of finance and build stronger public-private partnerships to achieve our common goals.

Successful development cannot be achieved with one-size-fits-all approaches; rather, partnerships for development can only succeed if they are led by developing countries and are tailored to country-specific situations and needs, especially in fragile and conflict-affected states.

At Busan, we have the opportunity to turn the page and make the coming decade not only a good one for development but a true game-changer. (END/COPYRIGHT IPS)

*Bert Koenders and Talaat Abdel-Malek are Co-Chairs of the Working Party on Aid Effectiveness.

GENEVA, Aug (IPS/South Centre) — As in previous episodes, a key factor in the current boom in capital flows to developing and emerging economies (DEEs) is a sharp cut in interest rates and a rapid expansion of liquidity in the major advanced economies (AEs), notably the United States.

This first occurred in a coordinated way after an agreement at the April 2009 G-20 summit in London as a countercyclical response to the crisis. In the U.S., recovery started in summer 2009 but the strong growth of nearly four percent in the first quarter of 2010 slowed to less than two percent in the second quarter.

The response of the U.S. Federal Reserve was to initiate another round of quantitative easing through purchases of long-term treasuries and other securities. Although the declared objective was to stimulate private spending by lowering long-term interest rates and raising asset values, this move has also been widely seen as an effort to weaken the dollar and stimulate exports.

But the rapid expansion of liquidity has not translated into a significant increase in private lending and spending in the U.S. because of problems on both the supply and demand sides of the credit market. As uncertainty about recovery and stability has continued unabated, banks have not been willing to lend to the private sector but have simply cashed in on the differentials between short- and long-term rates and looked for profit opportunities abroad.

Similarly, consumers, overburdened with debt, have not been keen on borrowing and spending while, in the face of relatively stagnant consumer markets, firms have not had much incentive to continue the investing and stock-piling that they had started earlier. As a result, excess liquidity has spilled over globally in a search of yields in DEEs, many of which have been put on the defensive in response to what is widely seen as a competitive devaluation by the U.S.

A key factor in the surge in capital inflows to DEEs after the Lehman bankruptcy in September 2008 was their significantly higher growth performance and prospects than the AEs. Yet although interest rates in many major DEEs were initially brought down in response to fallout from the crisis, the arbitrage gap widened as they began to raise them in 2010, while rates in AEs remained at very low levels.

As a result, carry-trade has been re-established and key emerging economies with high interest rates such as India and Brazil have become the main targets. Low interest rates in the U.S., together with the ongoing weakness of the dollar, made the dollar the new funding currency for carry-trade operations.

Furthermore, because of unprecedented difficulties encountered by large financial institutions in the U.S. and Europe and increased public deficits and debt, the crisis has given rise to a lasting shift in investment to the DEEs from AEs, where risk is perceived as being greater. A natural outcome is that DEEs now constitute a larger portion in the equity and bond portfolios of investors in AEs.

This is largely because these markets have rapidly become more like financial markets, with several commodities being treated as a distinct asset class and attracting growing amounts of money in search of profits from price movements.

The parallel movements in capital flows, commodity prices, and the dollar are not due only to the overall market assessment of risks and return and global liquidity conditions; they are also directly linked to each other. A weaker dollar often leads to higher commodity prices because it raises global demand by lowering non-dollar prices of commodities. On the other hand, changes in commodity prices have a strong influence on capital inflows to commodity-rich DEEs.

These changes have important consequences for the vulnerability of DEEs to boom-bust cycles. Exposure to the risk of instability and crises generally results from macroeconomic imbalances and financial fragility that accumulated during the surge in capital inflows, mainly in three areas.

First, surges in capital flows can produce or support unsustainable exchange rates and current account deficits. This is quite independent of the composition of capital flows. A surge in Foreign Direct Investment (FDI) would have the same effect on the exchange rate, exports, and imports as a surge in portfolio investment or external borrowing. If such imbalances are allowed to develop, sudden stops and reversals would produce sharp declines in the currency and economic contraction unless there are adequate reserves or unlimited access to international liquidity.

Second, financial fragility arises because of the extensive dollarisation of liabilities and currency and maturity mismatches on balance sheets. This would be the case when borrowing is in foreign currency and short-term. When capital flows dry up and the currency declines sharply, mismatches could result in increased debt servicing difficulties and defaults.

Finally, capital surges can produce credit and asset bubbles. Credit expansion can occur when banks borrow abroad to fund domestic lending, currency market interventions cannot be fully sterilised, or inflows lower long-term interest rates. The linkage between capital flows and asset markets strengthens with the greater presence of foreigners in domestic markets. Not only portfolio investments but also many types of capital inflows that are traditionally included in FDI, such as acquisition of existing firms and real estate investment, can create asset bubbles. Reversal of capital flows could then create credit crunch and asset deflation with severe macroeconomic consequences. (END/COPYRIGHT IPS)

*Yilmaz Akyuz is the Chief Economist of the South Centre and former Chief Economist for the United Nations Conference for Trade and Development (UNCTAD). For further analysis see South Centre Research Paper 37.

Celso Amorim, one of the founding fathers of IBSA. Credit: Monika Flueckiger/WEF

BRASILIA, 28 Jun (IPS) — Celso Amorim, one of the fathers of the IBSA Forum (India, Brazil, and South Africa) says in this interview that for this alliance of three major emerging powers, “Helping the poorest countries is clearly one of its callings. This gives it both its uniqueness and its international legitimacy.”

As Brazil’s head diplomat during the government of Luiz Inacio Lula da Silva (2003-2010), Amorim led international negotiations, like the Doha Round of the World Trade Organisation (WTO), the South American integration process, and the broadening of the G8 from the club of the most powerful countries into the G20, a forum dedicated to the coordination of the global economic strategies while incorporating the emerging nations.

Amorim’s achievements led American David Rothkopf in an October 2009 article for Foreign Policy journal to designate him “the best foreign minister in the world”, arguing that it was “hard to think of another foreign minister who has so effectively orchestrated such a meaningful transformation of his country’s international role”

Foreign minister from 1993-1995 as well, Amorim is a diplomat and university professor of political science and international relations.

Q: What was the reason for creating IBSA?

A: IBSA was created as a lighthouse for policy formulation and South-South cooperation between India, Brazil, and South Africa, three countries with much in common, three large, vibrant, multi-cultural democracies, each located in a different developing continent. The four summits and innumerable ministerial meetings and the intense activity in civil society show that there is great potential for cooperation and mutual learning that we are starting to explore.

Q: Is there a danger that IBSA is diluting certain functions of the BRICS group (which also includes Russia and China), for example, reforming the world financial system, or the International Monetary Fund, or WTC negotiations? In short, how are these groups different, and what do they share?

A: The commonalities of the IBSA countries are more evident than for the BRICS countries. For a start, two are permanent members of the UN Security Council and thus less interested in reform of global governance in security and peace. This doesn’t prevent BRICS from finding common ground on financial issues efficiently and with greater impact. But on other issues, like Palestine and Iran, it is hard to find a common position for all IBSA members.

Q: How could IBSA contribute to a new structure of international trade, considering the leading role it played in important processes in the Doha Round of trade negotiations to defend the interests of the developing world as well as the divergences between India and Brazil on agricultural policy?

A: Trade is a good area to demonstrate how cooperation between the IBSA countries can move more quickly. For a start, Russia is not a member of the WTO. On the other hand, the competitiveness of China given the currency and labour standards imbalance, among other factors, triggers a defensiveness that does not exist, at least to the same degree, among the IBSA countries.

The IBSA Forum, joined with other nations like Argentina, was the motor behind the creation of the G20 in the World Trade Organisation, which played a decisive role in changing the negotiating model of the organisation. Though there are differences between India and Brazil regarding access to agricultural markets, both countries share a desire to reduce or eliminate the agricultural subsidies of the richest countries.

Q: How do you see the future of relations between IBSA, or its individual members, and China? Will they move towards greater cooperation or more conflict given China’s aggressiveness in trade, its voraciousness for natural resources, and its disputes in Asia?

A: I don’t think that relations with China will become antagonistic. However, as a major developing country, China would make a major contribution towards strengthening its cooperation with the IBSA Forum if it took a more positive attitude towards UN Security Council reform.

Q: What influence might IBSA have in effecting climate change? What common positions does it share with other groups that might contribute towards an agreement?

A: In this area IBSA is in agreement with China inside the BASIC group (Brazil, South Africa, India, and China), which played an important part in negotiations. Beyond official debate, elements of IBSA civil society are in a better position to work out a coordinated plan of action. In this as in other areas, including as part of larger groups, IBSA must not lose its personality.

Q: What role does IBSA play in strengthening the position of the least developed countries in international negotiations, whether in trade, the environment, security, or development assistance for these countries?

A: Providing assistance to the poorest countries, like Haiti, Guinea Bissau, Burundi, and Palestine, has clearly been one of the callings of IBSA. It is very important that the forum continue to demonstrate its ability to act in solidarity, even in areas of trade and finance, taking advantage of its membership in groups like the G20 (industrial and emerging countries) to defend not only its interests but also those of the poorest. This is what gives IBSA its uniqueness and gives it international legitimacy. (END/COPYRIGHT IPS)

UNITED NATIONS, May (IPS) — The remarkable rise of emerging economies has become commonplace in public debates. Yet, not long ago, countries like China, Indonesia, Brazil, and Turkey were considered off-limits by many foreign investors.

Today, as the world emerges from its worst recession in decades, its recovery owes much to the strong growth recorded in these countries. In a matter of years, they have lifted millions out of poverty. Their domestic consumption has reached record levels, boosting demand in commodities exports around the world.

The rise of emerging economies is one of the defining trends of our time. One only wishes more countries could emulate them.

As it happens, 48 candidates are looking to take up to the challenge.

In United Nations vocabulary, these are the least developed countries (LDCs): 33 in Africa, 14 in Asia and one (Haiti) in the Caribbean. Usually, they are mentioned in connection with the ills they endure: endemic disease and poverty, low economic and human capital, bad governance and civil conflicts.

Though they are the world’s most vulnerable countries, LDCs have what it takes to become the global economy’s next bright spot: an abundant and mostly young workforce, the most prized natural resources (petrol, metals, minerals, crops, and arable land) and a growing drive to attract investors.

By most accounts, positive change is taking root in some LDCs. Over the past decade, their economic growth has been consistently strong. Already, some of these countries rank high on the list of future business hubs.

But with over half of their 900 million inhabitants surviving on less than one dollar per day, the Least Developed Countries need to do more. They need to pursue the path of economic reforms they have embarked on, while fighting corruption and mobilising domestic resources.

At the same time, development partners must maintain their support for LDCs. The positive decade-long trend in disbursements of Official Development Assistance (ODA) must continue. Previous commitments by rich countries to abolish all trade barriers for LDC products must be honoured. Through the adoption of special regimes, developed countries should also encourage their corporations to expand into LDCs’ productive sectors. Fiscal incentives, rewards for transfer of technology, and facilitated access to credit and market for local and foreign investors are some of the tolls rich countries could use.

Fortunately, the newly-emerging economies of the world can, and have been playing a role in the LDC resurgence. South-South cooperation in the form of investment and trade deals with the LDCs is on the way to surpassing economic inputs from the North, and development assistance from the South is increasing as well.

At the Fourth UN Conference on the Least Developed Countries, to be held 9-13 May in Istanbul, Turkey, world leaders will sign a new action plan for LDCs that will replace a previous one, agreed upon in Brussels ten years ago. As this gathering takes place, it is worth noting that much like emerging economies helped avert a full-blown global economic crisis, the world’s most vulnerable countries could become the world’s line of defence against future shocks. (END/© IPS)

*Cheick Sidi Diarra is United Nations Under-Secretary-General and High Representative for the Least Developed Countries, Landlocked Developing Countries, and Small Island Developing States.