Editorial
Finance adviser’s outrageous argument
Even the suggestion that the state will relinquish all its operations in a sector which affects up to a fourth of the population is outrageous, especially in a poor economy where the state must take a social stand simply for the welfare of the people. Mirza Azizul Islam, the finance adviser to the military-backed interim government, has dismissed any possibility for increasing or providing support for the jute sector. He told a discussion on the proposed budget on Thursday that the jute sector drained precious public resources — to the tune of Tk 300 crore — and the government could not afford to continue its support. Furthermore, he indicated that the public-sector jute mills were inefficient and thus there was no point to keep them in operation.
We firmly oppose this position and assert that there is much prospect in jute. It is a point of fact that large amounts of jute are exported to India and even to developed and developing countries, which process this jute and produce other products. The Indian government has been putting in much of its efforts to revive the jute sector there, while successive governments, including the current one, has let it slide, although Bangladesh has the natural advantage of producing the best quality of jute in the world. By implication Mirza Aziz admitted that it would not be possible for him, his colleagues or the entire bureaucracy that they supervise, to revive the jute sector like their counterparts in India.
Declining further assistance to the jute sector was not the only instance of Mirza Aziz brushing off suggestions from the audience on Thursday. He also stuck to his position that inflation would not rise due to a policy mismatch of an expansionary budget, with a large deficit, coupled with the contractionary fiscal policy of the central bank and heavy domestic borrowing. Furthermore, he said local businesses and industries would not be hurt by the increasing costs of raw materials and industrial machinery and decreasing tariffs of finished goods and luxury items. It is either that hardened businessmen do not understand their business or that Mirza Aziz has discovered a secret of making profit despite rising costs of production. He has also apparently stumbled upon new economic theories that suggest the budget’s policy mismatch would not spark inflation.
The same day, several leading trade bodies announced that their businesses would be hurt and industrialisation impeded due to the new tariff measures that were undertaken at the behest of multilateral lending agencies. The Bangladesh Economic Association, at another briefing, also said inflation was unlikely to be in check besides pointing out that the tariff measures would hurt local businesses. It is becoming increasingly apparent that the finance adviser’s candid announcement regarding incorporation of the suggestions and recommendations from the people at large was only a sham.
The proposed budget, if his assertions are anything to go by, will not be amended in accordance with the suggestions of the local businessmen or economists. He also appears to be toeing the line of the international financial institutions for reasons best known to him because the budget does not safeguard the interest of the people by protecting the public sector, or that of the industrialists, and thereby violates national interests as well.
Health service and the poor
That health is a right and not a privilege was, appropriately, the theme of the two-day National Health Rights Conference held in the city recently. The conference, which was organised by Health Research and Rights Foundation in cooperation with the Population Services and Training Centre and 52 other organisations, emphasised the need for raising health consciousness. It was observed that due to lack of awareness the poor are being deprived of the basic health services. Some statistics revealed at the conference were dismal — per capita health expenditure in the country is $4 only and 60 per cent of the people are deprived of proper health services.
It should be realised that if $4 is spent on health per year it does not mean the amount is being spent on poor patients; and if the allocation is raised the benefit of the enhanced allocation will not percolate down to the poor in any significant measure, given the ruling philosophy of market and the negation of distributive justice. We fully agree that healthcare is not a privilege, nor a matter of welfare or philanthropy; it is an inalienable right of a citizen. As regards awareness, this health awareness of the poor patient must be matched by a sense of duty on the part of those who matter, planners, health administrators, medical personnel, hospitals. Since the mid-1970s we have been encouraging doctors to earn foreign exchange for the country instead of treating the patients at home. Of course, for the majority of the people who are left outside the ambit of scientific medicine, it is immaterial whether the healers treat patients abroad or in their own country.
Hopefully, awareness of common people on health issues has grown in recent years. Credit should go to media, including the print media which routinely publishes at least one weekly page on health. A generation ago people were not familiar with words like LDL cholesterol and diastolic. Consciousness about safe food and drinking water has also grown. Sanitary latrine is used by whichever poor family can afford it. The common people have responded positively to all health challenges but the levers of health service are operated by the rulers, and others. What slice of the health facilities is allotted to the poor, how high or low do they figure on the health agenda is the seminal question.
Time was when a poor patient who could manage to enter a public hospital did receive free treatment. That was before the profit-driven private hospitals came into the scene. The principal reason for deterioration of service in public hospitals is the private clinics/hospitals which have monetised the entire health system. The homage to market has further marginalised the poor, in terms of healthcare as in every other way.
A summit of broken pledges
Lofty and laudable is the rhetoric the G-8 has never failed to produce, yet default and departure on pledges characterise its performance. Default has had many alibis. Corruption, bad governance, and lack of absorption efficiency in the recipient clients are standard refrains. But few have accused the donors of broken promises, let alone bad faith or riddled with misplaced or misguided priorities. To some established global charities, the aid pledges are fulfilled more by breach than by delivery,
writes Dr Zakir Husain
THE G8, the club of the rich and powerful (with a few aspiring attendees invited), met and talked only as the G8 does. The group talked about the world, and then some more, in opulent ambience, on how the rich and powerful will lift the world and Africa in particular out of hunger and poverty. From atop the summit of the privileged, the G8 at Heiligendamm in Germany this time pledged $60 billion to help the poor and the underprivileged. That is a lot of money; meant to impress the poor and aspiring-to-be-rich world.
But how much of that $60 billion is real or new and how much is recycled pledge of the Gleneagles summit in 2005? The camouflage is thin. The group fell short of delivering what it had committed in 2005. How much confidence the world can have that this $60-billion pledge will be met this time around?
‘Kabuliwallahs’, the legendary moneylenders-cum-fruit vendors from Afghanistan, were made famous by Tagore’s story of the same name. They wandered in the then British ruled Bengal and lent money door to door; they too had been prompt to collect the interest but not keen to collect the principal.
Moneylenders of the world today are no longer mere Kabulis; they are now high-profile and untouchable entities (the World Bank, the International Monetary Fund) doling out sermons and services to the poor on how to become better off by dutifully paying up the charges. Then there are bilateral donors and lenders who bring additional something to the development business; they are all dedicated to the cause; are euphemistically the so-called ‘development partners’ of the ‘developing’ world.
The Kabulis of today too collect the interest but in no hurry to realise the principal; when prodded hard sometimes are obliged to reschedule or even forgive the debt (usually after the principal has been paid off through interests).
Like the legendary Kabulis of the past, lenders of today with all their generosity and sensitivity made the poorer borrowers with fragile economy heavily and dangerously debt-ridden, some on the verge of bankruptcy. The poorer the borrower the heavier the debt burden becomes eventually such that most of the export income is mortgaged to repay the interest but never enough to repay the debt, let alone spend on development.
Old-fashioned money lending might have become modern but not necessarily more civilised even if a trifle more sophisticated.
Kabulis were not known to default on their pledge (but insisted on the interest due). Modern lenders wilfully default for they mix their lending with the notion of altruism and charity. Shall the poor celebrate this and sing a song ‘In praise of modernity’?
As an onlooker, there are times I am left wondering if anything has changed? Is it not like the famous French proverb: The more things change the more they remain the same?
The rich and powerful of today gather in palaces or picturesque resorts of affluence, dine and wine in opulence; they ponder deeply over how to rid the world of poverty and under development, and how to relieve the hunger and illness that torment the less privileged and endowed that they find unacceptable and endangering the much sought after security and stability of a ‘world order’ they have devised.
Lofty and laudable is the rhetoric the G-8 never failed to produce, yet default and departure on pledges characterised its performance.
Default has had many alibis. Corruption, bad governance, and lack of absorption efficiency in the recipient clients are standard refrains. But few have accused the donors of broken promises, let alone bad faith or riddled with misplaced or misguided priorities. To some established global charities, the aid pledges are fulfilled more by breach than by delivery.
There is more than mere default.
The donors are reluctant or resistant to make the sort of ‘sacrifices’ necessary — for example doing away with domestic farm subsidies by Europe and the United States, lifting indirect and direct trade tariffs and other barriers against imports from Africa and Asia. Besides, most bilateral loans and grants are tied; the string that ties could be silken smooth or made of crude coir that suffocates, but strings nevertheless. Genuine generosity with empathy is conspicuous by its rarity.
If the donors wish to hold the high moral ground they have to adhere to certain principles whether the outcome is convenient or inconvenient. Opening up markets to Africa and Asia will hurt, so will the removal of farm subsidies cause a ‘reverse transfer’ of trade-related income in favour of the primary producers in poor countries. But to preach to the poor what you refuse to practise in the rich world is unfair and undiluted hypocrisy.
But there is something more germane to the whole issue of G8 pledges to lift the continent of Africa out of its misery and poverty often seen as a ‘scandal’ or ‘obscenity’ by some world-renowned charities.
The G8 at this juncture could look itself in the mirror and ponder in all honesty on how appropriate had been the proposed aid packages and the instruments of their delivery during the past decades of development?
If it is to lift the continent’s majority people from abject poverty and set them on a trajectory of self-reliant and sustainable growth and productivity, there has to be a different pathway. That pathway is opened by far more generous investment of capital, domestic and foreign, rather than by tied aid for relief of hunger- and diseases-afflicting millions.
Those millions need to be given the necessary mix of capital — a mix of money, knowledge and skills, and good health such that they become productive and self-reliant through earning and jobs.
Charity might keep their nose above the sea of poverty, or to live today only to die tomorrow, to get cheap drugs today only to be afflicted by the same or another illness another day.
In an alternative pathway, capital for employment and investment can be generated through fair and free trade — something talked about more than actually implemented. Domestic capital can attract foreign investment in a spirit of genuine partnership and mutual interest and respect rather than by charity or concession.
Capital flows are seldom driven by altruism. Those who preach that sentiment delude themselves, world leaders and philanthropists included.
A surge in African investment, a surge in exploitation of the vast untapped natural resources of the continent will generate the kind of income and wealth that, if distributed justly and equitably, could make a huge dent in unemployment and poverty. Investments rather than charitable loans and grants are what will put the continent on a takeoff platform and a self-sustaining growth curve. Of course, investment in education, skills and employment, health is a critical component in that package.
The growth of human capital supported by the beginning of a knowledge-based society would give a big boost to good governance and democracy more than outside prodding and threats of sanctions or censure coming from the West, however well-meaning.
Aid as charity is not the cure; it is like putting a band-aid upon a festering sore without getting at the underlying pathology — in this case a pathology of poverty, ignorance and ill health compounded by unrest and despair leading to violence and pervasive insecurity.
But how the rich countries protect their domestic markets by way of farm subsidies — several times more than $60 billion, how they put barriers to free trade with poor countries, how these practices depress the prices of commodities the poor farmers produce, and keeps them mired in poverty; how there is in fact a net transfer of resources to the rich from the poor countries — these are no mystery. Yet, the myth of aid and loans is maintained by such periodic photo-op and holiday summits like the one just concluded in Germany.
In reality, such aid, if and when delivered, is siphoned off by the donor country’s mega- pharmaceutical companies when drugs for HIV/AIDS are provided, when fat salaries are paid to consultants and coordinators (from abroad and home) of aid-funded projects, when food shipments depress domestic food production and cripples agriculture and agro-based industries, when corruption makes a few native officials rich with little, if any, of aid money going directly to the poor to generate income and employment for them. Above all else, this kind of aid robs the recipient of any residual dignity and development initiative anchored in self-reliance.
Beyond or beneath the myth, the harsh truth though unpalatable sends a chill down the spine: the child starving in Africa, the child immunised against measles or polio, the mother given cheap drugs for HIV, will die of something else, surviving children will not be educated or skilled, adults will remain without employment and income to support families.
The breaking of the cycle of hunger, disease and poverty must be by alternate actions and treading the path less travelled in spite of many uncertainties or risks lurking. There is no alternative other than to face the truth even if ugly and unflattering to the innocent and well-intentioned practitioners of charity and altruism.
Had aid been directed to build infrastructure, education and health for all, industry and agriculture, communication, and economic growth with fair trade and with distributive justice, the continent could have done away with subsidised drugs for malaria and tuberculosis and HIV.
Africa is not uniquely destined to poverty, ignorance, and ill health nor is it to warfare and tribal conflicts or famines. If Africa is to be saved and brought out of the vicious cycle of negative growth, it deserves and needs a different kind of aid, given generously and with no default. The path to growth and development starts from a base of self-reliant growth and not benevolent charity. Fair and free trade and commerce could free the continent from the distorted trade and aid by rich countries. Let justice and fairness prevail to restore trade earnings and investment of comparative advantage rather than producing commodities for export only at the cost of starving the domestic population.
How long the G8 can or will hide its head in the sand like the proverbial ostrich? For how long leaders of Africa — South Africa and Nigeria for example — remain in line obliged to be lectured and patted on the back by the condescending rich?
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