The mystery we call development

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In the late 1970s, Canadian diplomat David Malone found himself in Sudan, tasked by his government to check in on its $30mil aid programme. Six big projects were involved, ranging from dry land farming to road building to forestry inventory. “They were the sort of things we thought, in conversation with the government of Sudan, might be useful for the country,” he said.

Driving cattle in Sudan. There, cattle matter more than people in many ways.

Ten years ago, he went looking for those projects. And found that they were gone. Not a trace of the Canadian government’s investment remained – even the roads had disappeared. This led him to reflect on how and where they had gone wrong. There were many reasons why the programme failed so comprehensively, but one conclusion Malone arrived at was that they had misunderstood how pastoralist Sudan is. “Cattle matter more than people in many ways because they are the unit of exchange, economically and in nearly every other sense socially as well. Cattle don’t prefer paved roads, they prefer tracks. The people who look after cattle don’t feel they need forestry inventory.”

It wasn’t the first time he’d seen the effects of bad advice on international development. His family moved to Iran in the 1960s, when he was eight. Iran back then was the poster child for development – “It was the country that other countries in the developing world should be imitating.” Western-style modernisation had been introduced, leading to terrific economic growth and the emancipation of women in the country.

Months after his family arrived in Iran there was a series of violent riots, and many women in professional jobs were killed. The experts, according to Malone, shrugged it off. It’s a blip, they said. All the economic indicators were up. The modernisation policy was “selfevidently” working, and things would eventually work themselves out.

The rest is history. Other than the riots, there had been other warning signs. Obscure journals by Iranian and French anthropologists and sociologists had earlier reported that many Iranians in rural areas and the growing slums in large cities were uncomfortable with the policy. “It was too much change too fast, in a direction they weren’t certain they wanted to go,” said Malone. “These people were comprehensively ignored by the so-called experts, and it all ended very badly for Iran.”

Experts getting international development completely and utterly wrong was an issue Malone repeatedly raised in June during his talk, “International Development: A Contradiction in Terms” at Wawasan Open University. This event was ably organised by Think City and United Nations University (UNU).

Malone readily admits that he is not a development expert, but development had woven in and out of his entire life. From 2008 to 2013, he was president of Canada’s International Development Research Centre. Before that he served in numerous positions, including as Canadian Ambassador to the UN, Canadian High Commissioner to India and non-resident Ambassador to Bhutan and Nepal. Last year he was appointed Under-Secretary-General of the UN and rector of UNU.

“Development isn’t illusory, even if a number of strategies turns out to be bad ideas. The so-called experts generally learn by stubbing their toes, finding out they were wrong, and then moving on to some other prescription.” However, countries that go their own way, he argues in his talk, tend to do well compared to countries that depend on a one-size-fits-all solution espoused by experts. He sat down with Penang Monthly the day following the talk for a chat about corruption and growth and how he sees development aid evolving.

David Malone.

Can you give our readers the gist of your argument?

Malone: Societies develop themselves, or not. Leadership is important as we saw in China, when Mao Zedong died and was succeeded a few years later by Deng Xiaoping. It made a big difference and Deng put China on the path towards growth. But essentially all of that was internally driven. It wasn’t created by the international development world. It was essentially a home-grown project that turned out to work very well.

Countries that rely heavily on aid, on the other hand, tend to become addicted to it rather than focused on how to be self-sufficient and live off their own resources. The international development experience was very well intentioned, but I also think it was fairly naïve because it was based on saying, “For the first 10 years or so, this was how we did it in Denmark and Canada, and you might want to consider doing it this way”. Usually that was completely inappropriate to the countries involved at their stage of development.

Then we moved on to more sophisticated development projects, many of which were in the form of loans, not gifts. And that precipitated several decades later the huge debt crises in Africa and elsewhere, which were overhanging many developing countries until schemas were developed for debt forgiveness. Even debt forgiveness was often highly political, and in none of these was there a sense of national responsibility for national outcomes.

But the countries that did take responsibility for national outcomes, including Malaysia, became much more autonomously driven and resilient, such that during the financial crisis of 20 years ago, Tun Dr Mahathir Mohamed was able to see off the IMF. He turned out to be right, which was confounding for the international institutions, and they learned something from that – they weren’t always right. It would be nice if they had learned that 50 years earlier.

East Timorese children. After the country's independence in 2002, the development assistance it received was very helpful.

The international financial institutions today are much more self-critical, but their golden age is over. Many countries are developing well and relatively fast, and do not need development assistance the way they thought they needed it 50 years ago. It’s not something that’s central to the African development model, except in some fields. Mostly, African governments are seeking development through foreign investment rather than foreign aid.

Aid tends to be marginal except in extreme cases. At the time of its independence, East Timor was flat on its back. It could do nothing on its own. And the development assistance it received – a lot of which came from South-East Asia – was very helpful. It’s only now many years later that they’re getting to a point where development assistance is no longer so important to them. Eventually they won’t need it at all.

I’m curious why or how the experts can get things so wrong.

Many researchers do like to go on the ground to survey local populations on their preferences, thoughts and circumstances relating to a given issue. Others are much more comfortable in their offices with books and statistical data they got from somewhere else; those people are more likely to come up with bold schemes. Those who spend a lot of time on the ground with the population are much less likely to be too sure of themselves. They realise that people don’t always tell the truth in surveys. Many people around the world have no reason to trust their governments, so when they are asked questions, they are often fairly guarded in their answers.

If you’re an experienced researcher in the field, you know this, and you adapt your approach. You become quite prudent about your conclusions. Whereas people working off hard data somebody else has collected often make mistakes that somebody on the ground wouldn’t.

That is one of the reasons I strongly feel we need to be extremely cautious about what big data-type research people get excited over today. The data will have to be aggregated at such a high level of generality that it will be very difficult to learn anything much from it. Indeed, we’re probably going to be completely overwhelmed by big data rather than be able to interpret it. What we need is better data, and more cautious collection and evaluation of data.

The effort to make Iranian women into Swiss women within 20 years produced a tremendous backlash in the country. If you move too quickly on some of these reforms, you self-destruct.

The irony is, although Iran was subject to a revolution that apparently set back the status of women, it was impossible to set it back completely, because women were so highly educated and useful. In Iranian universities today you will find that many of the most distinguished professors and department heads are women. Women are often the backbone of certain professions. In the long run it worked, but they tried to implement it too fast in the 1950s and 1960s.

I’d like to go into a very surprising thing you said, about how corruption isn’t necessarily a hindrance to growth.

I think you need to separate corruption, which we all dislike, from growth, which is mysterious. We don’t actually understand why growth happens, although there are a number of clues as to what prevents growth from happening. Extraordinarily, statist approaches generally don’t work very well. Socialism didn’t work very well in India.

But can we say that we know what causes growth to happen? I don’t think so. All I was saying (at the talk) is that in a number of countries that have sustained very high growth in the last 20 years, this very high growth coexists with very high levels of corruption, and we can’t dismiss that out of political correctness. If we are serious as researchers, should we dismiss evidence just because we don’t like it? I’m not a proponent of corruption – I’m actually a great supporter of Transparency International. But there is a great deal that we don’t know about how corruption interacts with growth.

For example, Canada was a prodigiously corrupt country during its period of fastest growth in the second half of the 19th century. And it was only at the end of the 19th century that corruption was tamed in Canada, but national levels of growth also slowed down.

Correlation isn’t causation, though.

There’s no correlation or causation there, but we started out being very, very corrupt in Canada, and I try to keep that in mind. Most of the people who preach to others to be like themselves have no sense of where they come from. They project themselves onto others rather than respect the experience of others.

There's no doubt that several fastgrowing countries in Asia now and in the West in the past have been tremendously corrupt. It may be that corrupt transactions unleash rapid growth for a while, in sectors such as infrastructure and real estate development – growth that can benefit many of the poor, as it has in China. But a time comes when the public will rebel against mass corruption.

There's no doubt that as countries develop, public aversion to corruption will grow, and this can constrain both overt forms of graft and wildcat growth, particularly in electoral democracies. There has been great reluctance to address how certain phases of (real) development through growth seem immune to corruption, while later stages constrain it. Political correctness on display, one assumes.

Canada was a prodigiously corrupt country during its period of fastest growth in the second half of the 19th century. That corruption was tamed, but national levels of growth also slowed down.

How do you see development aid or programmes evolving in the next 50 years?

I think it’s going to be much more interactive. A country like Malaysia doesn’t need development assistance, but it may welcome it on a co-investment basis. We put in some money, you put in some money, and together we can leverage what we both know into a joint experience. I think that’s a great model. The local participation is on a footing of equality.

Secondly, I think development institutions are going to be much more advisory. We’ve learned to be much more humble about development, and you see a manifestation of this in both the heads of the World Bank and the IMF. They’re much less affirmative and much more questioning than some of their predecessors were.

Will the UNDP have to change?

Yes, and it is changing. For example, they’re cutting their headquarters staff and putting many more people in the field. There’s a lot more to be learned in the field than there is in New York. You learn quite a lot about development by living in and among developing societies. My interest in developing societies goes back to my boyhood. I still love Iran and I’m interested in everything that happens there. I feel the same way about Egypt where I lived for four very happy years.

If I hadn’t lived there, my interest in Egypt would be rather clinical. My interest in Iran might even be critical, given so much negative news we hear and negative analyses we read about Iran. Learning is the most exciting thing one can be engaged in, and yet many people seem to be scared of it. They seem to think that if you’re 40, you shouldn’t be learning anymore, you should be teaching. It’s the greatest luxury to go on learning if you can.

Jeffrey Hardy Quah is deputy editor of Penang Monthly.



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