From the Department for International Development

20 June 2002

Poverty Reduction and Sustainable Development – the Challenge for Johannesburg

A speech by the Rt Hon Clare Short MP, Secretary of State for International 
Development

Development Policy Forum, QEII Conference Centre, London

Introduction

In a little over ten weeks time Ministers from across the world – including our Prime Minister – will meet in Johannesburg, South Africa, at the World Summit on Sustainable Development (WSSD), which marks ten years since the United Nations Conference on Environment and Development in Rio. The final preparatory meeting for this summit finished two weeks ago in Bali. It was not the disaster that some non-governmental organisations (NGOs) claimed – the preparatory processes for UN conferences often leave much to be desired – but there is some way to go before we can be confident that we will have a successful outcome at Johannesburg.

I would like today to outline my hopes for the summit. I see it as a critical opportunity to bring the development and environment movements together in a systematic effort to both reduce poverty and pursue sustainable development.

WSSD should not be seen in isolation. It is the culmination of an international process – the Millennium Summit in September 2000, the Doha meeting of the World Trade Organisation (WTO) last November, and the Monterrey conference on finance this March. Together these meetings have made important steps in improving the effectiveness of the international system.

The Millennium Summit

At the Millennium Summit in 2000 world leaders committed themselves to work together to meet a series of Millennium Development Goals. The overarching goal was the halving of the proportion of people living in extreme poverty by 2015, together with other goals, including achieving universal primary education and reducing child mortality by two-thirds – all by 2015.

The goals were carefully chosen. They are achievable. But they are not simply a description of present trends – business as usual is not an option. Reaching them will require a significantly increased development effort from the whole international community. This means fairer trade rules that allow developing countries to access our markets; and it means increasing development assistance, improving how that assistance is delivered, and focusing it on poverty reduction.

WTO meeting

Trade has an important role to play in the achievement of the Millennium Development Goals. For too long the rich countries of the world have lectured the developing world about trade liberalisation, but created barriers to developing country access to their markets. Doha agreed an agenda for change. It placed the concerns of developing countries at the heart of the next trade round. And it included a particular commitment to negotiations on agriculture aimed at substantial improvements in market access.

We need to deliver on this commitment – and the European Union needs to show leadership. The EU’s Common Agricultural Policy acts as a barrier to progress on developing countries. The Common Fisheries Policy subsidises the EU fishing industry, which contributes to over-fishing in waters often far from Europe meaning that subsidised and highly sophisticated European fishing boats compete with communities dependent on fishing for their livelihoods. These policies need to be reformed.

Financing for Development

Four months after Doha, the UN Conference on Financing for Development in March this year also marked an important step forward. 

Monterrey was about recognising the need to galvanise all sources of finance – domestic savings, foreign direct investment, export earnings, debt relief and aid – in order to eradicate poverty, achieve sustained economic growth and promote sustainable development. It was about a new consensus that recognised the crucial role of the state and private sector in promoting social and economic development. Developing countries recognised the importance of good governance – both political and economic – and member countries of the Organisation for Economic Co-operation and Development (OECD) committed to providing more and better aid, a sustainable exit from debt, better trade access, and a stronger voice for developing countries in international decision making.

At Monterrey, the European Union and the United States made pledges of increased aid which we estimate will lead to an increase in development assistance from a total of $55 billion in 2003 to $67 billion a year by 2006. This commitment to reverse the recent decline in aid levels is welcome. And the UK Government will play its part. We have increased the aid budget from 0.26% of gross national income in 1997 to 0.32% in 2001 – a one third increase in real terms. This makes the UK the fourth largest bilateral donor in volume terms. And we are committed to raising development assistance to the UN target of 0.7% of gross national income. The announcement of our next step towards this goal will be made following the 2002 spending review in July.

Improving the quality of aid – as well as increasing the quantity – is also crucial. In the past aid has been used too often for political reasons, or to promote the trade interests of the donor country, or to prop up corrupt rulers for short-term political reasons. The Monterrey Consensus recognised the need to improve the effectiveness of aid: to untie it from the interests of donor countries; to harmonise donor procedures so that the high transaction costs in developing countries are reduced; to make it more responsive to the needs of developing countries; and to increase its targeting on the reduction of poverty.

A constant barrage of negative media images leads many people to believe that international development is a hopeless enterprise. This is misleading. Aid works and is lifting large numbers of people permanently out of poverty. There have been big improvements in how aid is delivered – but more needs to be done. In fact if the existing $55 billion of international aid was untied and focused on poor countries which are pursuing effective pro-poor policies, it could increase its value by up to 50%.

More effective use of aid means moving away from funding a proliferation of projects to backing poverty reduction strategies drawn up by developing countries themselves. Unsurprisingly, experience has shown that reform agendas drawn up locally are more successful than those imposed from outside. The consequence of this new approach has been considerable strengthening of the quality and effectiveness of local institutions. This kind of improvement in the quality of governance has encouraged and enabled development agencies to put finances directly into government budgets – so helping to fund rapid improvements in health, education, water and other services that contribute to poverty reduction.

This is, I believe, the true meaning of partnership. Developing countries in the lead in developing their own poverty reduction strategies; development assistance supporting these strategies – building national capacity rather than undermining it. It represents a new approach to development assistance – from seeing aid as a drop of charity in an ocean of poverty, to being part of the process of building modern, effective states and strengthening local communities in order to deliver long-term improvements in the lives of the poor.

So this is the context within which we approach Johannesburg. We have an internationally agreed set of targets in the Millennium Development Goals; from Doha we have an agenda for a pro-development trade round; and from Monterrey we have commitments to increase the levels and improve the quality of aid. 

So what can be achieved in Johannesburg? 

Recommit the international community; build on existing partnerships

The Summit is an opportunity for world leaders to demonstrate their willingness to work together in the fight against poverty in the way that they have demonstrated their resolve to fight terrorism. Doha and Monterrey gave us agreed agendas for action. Sustained political will is now needed if these agendas are to be implemented. Johannesburg is an opportunity to integrate the environment into this consensus for global reform focused on poverty reduction.

The focus on establishing partnerships to achieve sustainable development is welcome. But we must be clear that Johannesburg is not about spending the money pledged at Monterrey. This money has only been pledged. It is not yet committed and will not be available until 2006. The stress should be on making aid more effective in the ways I have described and integrating environmental sustainability into the development agenda agreed at the Millennium Summit, Doha and Monterrey. We must also take the opportunity to integrate the New Partnership for Africa’s Development into the global consensus.

Bringing environment and development together

Johannesburg provides an important opportunity to change the terms of the global debate on the links between poverty, the environment and sustainable development. We must be clear that protecting the environment is not an end in itself. We do not simply want to conserve the world that we have. We want improved lives for the poor of the world and a world that is sustainable for future generations.

We must also understand that better environmental management can help eliminate poverty. Too often the environment is seen as a cost rather than an investment. We must move away from the scenario which says “do no harm”. This quickly takes on an anti-development perspective. Moreover, it has not worked.

Instead, we must harness the benefits that better environmental protection and management can offer to poor people. If we don’t have such an approach, developing countries will increasingly see environmental concerns as a preoccupation of the North: a North which achieved its own development by plundering and polluting the planet and is now trying to pull up the ladder behind it to exclude them from the benefits of economic development.

I believe that the World Summit provides an opportunity to forge a consensus around these issues. My hope is that we can fuse the energy of the development and environment movements so that they can work more effectively together for systematic poverty reduction and sustainable development.

The environment is crucial to the livelihoods of poor people. The poor depend on wood for their cooking and heating, they use fodder for feeding their livestock, they get medicine from the forest, they get water from streams and wells and they often build houses from natural materials.

The poor suffer most when air and water are polluted. A billion people – mainly women and children – are exposed to indoor air pollution from inadequate ventilation and the burning of traditional fuels, such as wood and dung. And they suffer too when seas are overfished and forests corruptly decimated.

And poor people are highly vulnerable to environmental disasters and to environment-related conflict. Droughts, floods and other disasters can wipe out any development gains that poor people have made. And their frequency and severity is expected to increase with climate change.

Kofi Annan and WEHAB

Johannesburg will produce three things: a high level political declaration, a more detailed Programme of Action, and a series of partnerships to deliver what is agreed. Kofi Annan recently highlighted five key areas where he hoped concrete results could be achieved – water and sanitation, energy, health, agriculture and biodiversity. Action on each of these – at Johannesburg and beyond – is important to the achievement of poverty reduction. Let me say a word on what I hope will be agreed.

First, on water and sanitation the political declaration and programme of action should recognise the importance of access to freshwater and sanitation to the lives of the poor. One billion people lack access to safe drinking water, and 2.4 billion people currently lack access to sanitation. Agreeing a new target to halve the proportion of people without access to sanitation – to complement the existing Millennium Development Goal on access to freshwater – would be a good achievement. 

In terms of partnerships and concrete action, the Summit provides an opportunity to improve donor effectiveness on water supply issues, to identify innovative schemes to lever in private finance, and to highlight access to sanitation as a key issue for the poor. My Department is working with other EU Member States to develop a new partnership to be launched at Johannesburg.

Second, on energy we should focus on the role energy can play in nationally-owned poverty reduction strategies. My Department is providing funding to help develop the Global Village Energy Partnership. This partnership would seek to create a 10-year work programme to reduce poverty and enhance economic and social development through the accelerated provision of modern energy services to those without access. It would bring together developing and industrialised country governments, public and private organisations, multilateral institutions and other key stakeholders to address the links between energy and poverty reduction in rural areas, and improve the delivery of energy services.

Third, on health the political declaration should focus on action to achieve the Millennium Development Goals for health: reducing child mortality by two thirds, reducing by three quarters the maternal mortality rate, and reversing the spread of HIV / AIDS, malaria and other major diseases – all by 2015.

Action on health should emphasise increasing the resources available to existing partnerships. We are pressing the international community – starting with the G8 meeting in Kananaskis – to increase investments to build comprehensive basic health care systems in African countries that are committed to achieving the Millennium Development Goals. This will complement the Global Fund established in December to provide drugs and commodities to fight HIV/AIDS, tuberculosis and malaria. To date, the Global Fund has received pledges of around $2 billion over five years – of which the UK has pledged $200 million.

Fourth, on agriculture the political declaration and programme of action should recognise the vital contribution of agriculture to poverty reduction through economic growth, sustaining livelihoods and delivery of environmental services.

Actions are required by developing countries to improve rural roads, access to markets, seed and fertiliser, credit and land security, supported by actions by developed countries to reduce the current iniquitous system of tariff barriers and subsidies. 

Fifth, on biodiversity the political declaration and programme of action should recognise the links between biodiversity and poverty reduction. Whether for food, medicine, shelter or income generation, poor people throughout the world depend on biodiversity. Forests provide poor people with a range of goods and services. 

The Summit should lead to action on illegal logging and the associated trade. This trade, which is based on corrupt and abusive misuse of forests, denies a livelihood to millions of poor people, it robs governments of billions of dollars which could be spent on development programmes, and it provokes and sustains conflicts. It is a problem shared by producer and consumer countries alike. And it requires actions by governments, business, consumers and civil society.

Africa

Finally, I believe that the location of the World Summit in Africa is important. Africa is the poorest continent. Half the population of sub-Saharan Africa survives on less than a dollar a day. On current trends population growth in Africa is outstripping economic growth and therefore the continent is set to become steadily poorer.

This is the challenge which the New Partnership for Africa’s Development (NEPAD) seeks to address. Launched in October last year, this partnership sets out a bold vision for Africa’s development. Its central principle is that it is Africa’s responsibility to advance African development, in particularly through efforts to promote peace, security and good governance.

If it is to succeed, NEPAD must transform the relationship between Africa and the rest of the world. It must bring a new drive and a new political energy to the development of Africa. Most important of all the people of Africa must be empowered to demand more of their governments and of the international community – both of which have let them down for too long.

Conclusion

The opportunity to eliminate poverty and leave a sustainable planet to future generations is within our reach. If we can grasp this, we can help build a world in which mass poverty will exist only as a memory – and a world that is more stable and secure for all our grandchildren. But this will not be done through business as usual or on a green agenda that is hostile to development. To achieve this we need to lock the world into a commitment to systematic poverty reduction and to meeting the Millennium Development Goals and we need to change our practice throughout the world to ensure that development is sustainable.

For a pdf version of this speech, click here.