As the Group of 20 (G20) meets in France this week, stabilising the global economy and creating jobs is rightly at the top of their agenda. A real risk, however, is that some of the policies key G20 members are considering risk reducing aid and other investments in growth and development in many of the world’s poorest countries. This would be a huge mistake, because this is precisely the moment when these countries are poised to accelerate the progress of the past decade and become rapidly expanding, stable partners in the global economy.
Rather than pulling back, this is the time to engage more deeply, across more areas and through exciting new partnerships. French President Nicolas Sarkozy has invited me to present a report to G20 leaders on how to expand financing for development, and in it I will be presenting some very concrete ideas about how to do this in a way that can speed up progress and innovation in areas such as health and food security, making sound, long-term investments that lay the groundwork for a world able to meet the needs and aspirations of all its seven billion citizens.
One of the reasons I am optimistic about the future of development is the dynamism of so many countries in sub-Saharan Africa.
These countries are using their own resources to lead their own development. The region is on pace to double the size of its economy in just the next decade, and there are ways for the leaders of sub-Saharan African countries to channel all that growth so that it has the greatest possible impact on their people.
In my report to the G20, I list three priorities for Africa’s leaders.
First, leaders can raise more money for development more efficiently. One way the G20 countries can help with this is by requiring mining and oil companies listed on their stock exchanges to publish what they’re paying to governments in developing countries. That way, the terms of natural-resources deals will be a matter of public record, and citizens in all countries can protect their interests.
The second thing African leaders can do to accelerate development in their countries is to allocate more resources to key poverty-reducing priorities such as agriculture and health. Most countries signed the Maputo and Abuja Declarations, pledging to spend 10% of their budgets on agriculture and 15% on health. They must follow through on those commitments.
Cost-effectiveness of development investments
Third, leaders can focus on the cost-effectiveness of their development investments. The data show that it is possible to get more impact from current spending. My foundation is offering to work with the G20 leaders to create a public-private partnership to help poor countries to conduct these cost-effectiveness studies.
The amazing potential of Africa is not the only reason I believe the world is in an excellent position to accelerate this progress, despite fiscal troubles.
The past 50 years have seen a huge increase in both the number of people who can innovate to solve tough problems and the number of countries that can afford to be generous. In short, there is a large and diverse pool of resources for development available right now, and we can get much more creative about tapping it.
There is a group of rapidly growing countries, such as Brazil, China and India, that have successfully travelled the development path and that have the scientific and technical capacity to innovate around the needs of the poor. To take just one example, China is gene-sequencing 10 000 varieties of rice to help small farmers in Africa to cope with the impact of climate change. I see the potential for many partnerships like this that capitalise on these countries’ special experience and capabilities.
Traditional donor countries also have the responsibility to continue their aid generosity. Many countries have set aid targets for 2015, and they still have time to take steps to meet them. The examples of the United Kingdom, Australia and Korea, all of which are increasing aid budgets even in these tight times, proves that generosity is possible. I urge the G20 to get serious about aid effectiveness, working harder to make sure their investments fill key gaps and encourage innovation.
Finally, the private sector can be more involved in development. The private sector is the engine of economic growth and the greatest source of innovation in the world. But it doesn’t always invest in the needs of the poorest, because the incentives aren’t always there. I believe there are ways to encourage private investment in areas such as agricultural technologies and infrastructure projects.
There are billions of dollars held by philanthropies, impact investors, diaspora communities and sovereign wealth funds that can be mobilised to help poor countries tap into their own dynamism and take charge of their own development.
When you add all this together, you can see the opportunity we have to spur even greater progress in development in the coming decade. With the leadership of the G20, I’m optimistic we can put the poorest countries and people on a long-term path to economic growth and better living conditions.