DEPUTY SECRETARY-GENERAL STRESSES THERE CANNOT BE SUSTAINED DEVELOPMENT PROGRESS UNLESS PEOPLE OF DEVELOPING COUNTRY FEEL THEY ARE IN DRIVING SEAT

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DSG/SM/56

DEPUTY SECRETARY-GENERAL STRESSES THERE CANNOT BE SUSTAINED DEVELOPMENT PROGRESS UNLESS PEOPLE OF DEVELOPING COUNTRY FEEL THEY ARE IN DRIVING SEAT

Addressing High-Level Workshop, Louise Frechette Says Both World Bank And UN Development Framework Initiatives Place Concerned Countries at Centre

Following is the text of an address by Deputy Secretary-General Louise Frechette to the World Bank Institute High-Level Workshop on Development in Washington, D.C., on 7 June:

Thank you very much for inviting me to join this important workshop, and to give you "the United Nations view on comprehensive development".

Every few years, development experts seem to come up with new catch- phrases. Besides enriching the development jargon, from time to time one of these does capture a real conceptual breakthrough.

In the last decade we have had "human development", followed by "sustainable development" -- or was it the other way round? Now it's all about "comprehensive development".

I shall not attempt this evening to draw out the fine distinctions between these concepts, or to rank them in order of merit. But I should like to stress two fundamental messages which I think all of them seek to convey:

-- The first is that development is not only, or even essentially, about economics. It is, or should be, about human beings: about satisfying their aspirations to live their lives in dignity, free from want and free from fear.

-- And the second is that development comes about, when it does, as the result of a complex set of interactions between political, economic, social, environmental and cultural factors.

The first of these messages -- that the ultimate purpose of development is to improve the human condition -- should be obvious enough. Yet the publication in 1990 of the first Human Development Report -- which sought to measure development by such social indicators as literacy and life expectation, and not just gross national product (GNP) -- came as a bit of a shock.

That report, with its eye-catching "human development index" was, as you know, the brainchild of Mahbub ul Haq, whose loss all of us in the development community still feel, nearly a year after his premature death.

Mahbub's object in designing the index, which he well knew was a very crude instrument, was to dislodge the tyrant GNP from its throne as the sole arbiter of a country's success or failure, and to get across the fact that man does not live by macroeconomics alone. I might add that woman does so even less.

The truth is that in the early days of development policy the complex set of interactions which make up the development process was poorly understood. Strategies giving priority to infrastructure development, or to the satisfaction of "basic needs", were all found wanting over time.

But real progress has been made in this decade, with the series of major United Nations conferences, which I believe have made a significant contribution to development policy thinking.

The policy orientations that came out of the Children's Summit, the Rio Summit, the Conferences on Population, Human Rights, Women, Human Settlements and finally, the Copenhagen Social Summit brought out more clearly than ever before the interplay between the various factors of development.

They showed that the best way to improve the health and nutritional levels of children is to educate women and girls. That poverty both causes and is caused by environmental degradation. That respect for human rights is a source of political stability -- which in turn is an essential prerequisite for economic growth.

That last lesson has been strongly reinforced by our experience in conflict prevention and post-conflict peace-building. Indeed, we find more and more that the two great missions of the United Nations -- development and peace -- are closely interrelated. Particularly in long-term peace-building we find that governance, social and economic measures and human rights need to be coordinated closely within an overall political framework. Too often that fails to happen because the different tasks are undertaken by specialists, many of whom are not used to thinking of their work in security terms.

The importance of good governance has been further highlighted by the recent financial crisis. What do I mean by good governance? I mean honest government, a solid institutional and regulatory framework, transparency. All these things turn out to be vital, if a country is to sustain full and safe

participation in open financial markets. And to create and manage such a system, a country also needs a cadre of highly capable public administrators.

But recognizing these interrelationships does not exhaust the policy debate. Far from it. In a world of limited resources and immense needs, critical choices have to be made among strategic priorities and instruments.

Earlier this decade, debate on development policy was dominated by sharp differences of emphasis between the Bretton Woods institutions and the United Nations. While the Fund and the Bank focused on "getting the fundamentals right", the United Nations was calling for "adjustment with a human face". One side's faith in the magic of the market was countered by the other's vigorous defence of the role of the State.

By now, I hope, we have all got a bit smarter. On the one hand, all of us now recognize:

-- that the forces of the market can be the most powerful motor of development;

-- that private flows of capital can be mobilized in far greater volumes than public flows can ever be;

-- and that unleashing creativity and entrepreneurial spirit in developing countries will produce better results than paternalistic, dependency-creating strategies.

On the other hand, I think we have also all come to recognize:

-- that the free play of market forces alone will not suffice to lift everyone out of poverty, and even less can it be relied on to reduce inequalities;

-- that investment in human capital through education and health services is not only a matter of social justice but also a sound use of scarce resources;

-- and that public flows of capital will continue to be essential, for years to come, for the many countries which are still only on the margins of the global market.

In short, there is now much greater convergence in policy thinking. The arguments you hear in the United Nations General Assembly, and in the boards of the Bank and the Fund are now often so much alike that if you closed your eyes you could not always be sure whether you were in New York or Washington.

So one could say that "we are all believers in comprehensive development now". But the concept does not only refer to policy. It also refers to the interaction among the various actors of development. It argues for coherent and coordinated approaches, with developing country governments playing a leading role.

Indeed, it was the need for greater coherence within the United Nations family of development agencies that led the Secretary-General to launch, as part of his reform programme two years ago, a number of initiatives in this area:

-- At the Headquarters level, he formed the United Nations Development Group (UNDG) as a forum for policy and operational coordination among all the United Nations funds and programmes involved in development.

-- At the field level, he directed that there should be action on three points:

1. devising a common development assistance framework, or "UNDAF", for each country where the United Nations is involved in development work;

2. as far as financially possible, regrouping the offices of all United Nations funds and programmes in each country under a single roof -- the so-called "United Nations house"; and

3. increased use of common services.

The UNDAF is the centrepiece of the new approach. It is a strategic planning and collaborative framework, intended to help identify priorities for action in each country where we operate. It serves as a guide and as a reference for the identification of individual agencies' programme priorities in a given country. It should thus bring about greater synergies, and eliminate duplications and contradictions, among United Nations interventions in the field.

Each UNDAF begins with the elaboration of a Common Country Assessment (CCA), which is a country-based process for reviewing and analysing the national development situation. This process allows the United Nations country team to think and work together, with the government and other actors, to achieve a common understanding of a country's development challenges.

The CCA includes an Indicator Framework that enables us to describe a country's development situation. The indicators refer both to general development targets, such as illiteracy and the infant mortality rate, and specific goals derived from the major United Nations conferences and conventions, such as the elimination of child labour and the implementation of United Nations human rights treaties. Let me illustrate by using the example of Romania, which was one of the UNDAF pilot countries. Our Country Team first developed the Common Country Assessment, which the Romanian Government says enhanced its own understanding of the country's poverty challenges. To put it in a nutshell, the economic transition from communism had not brought with it the social transition, or the improvements in the quality of life, which Romanian people had a right to expect.

The UNDAF itself then identified three priority areas for the United Nations to support in Romania, with poverty alleviation as number one. The combined CCA and UNDAF exercise, in which local World Bank experts took part, contributed to the creation of the National Commission on Poverty, directly accountable to the President, and to the elaboration of Romania's first National Strategy on Poverty. This in turn enabled the Government to qualify for appropriate World Bank loans. On the basis of the UNDAF, members of the United Nations Country Team are now working out the multi-year country programmes of their different United Nations agencies. These will operate on a harmonized programme cycle, starting next year and lasting through 2004.

Romania was one of 18 countries which took part in this pilot phase of the CCA/UNDAF process, starting in August 1997. The phase has now been assessed both internally and externally, and on the basis of these assessments, with policy guidance from the General Assembly, the provisional UNDAF guidelines have been finalized, and CCA guidelines have been formulated. Twenty more countries will begin the exercise this month, and all countries to which it is applicable will have started it by 2002.

At the same time we are speeding up the harmonization of the programme cycles of the different United Nations funds and programmes, in order to allow greater synergies in our operational activities at country level. Harmonization is now a precondition for all UNDAF exercises. It should be completed, for all the countries to which it applies, by 2004.

To sum up, the CCA-UNDAF process is helping the United Nations to identify clearly where it can make a significant, strategic difference for the countries and peoples it serves, especially the poorest and most vulnerable. And by promoting stronger, more focused linkages between our development mandate and our other core missions, including human rights, the CCA and UNDAF help to strengthen the coherence of the United Nations system as a whole.

How does all this fit in with Mr. Wolfensohn's "Comprehensive Development Framework (CDF)"?

Well first, let me point out that both stem from the exact same logic, namely the need to look at development strategies from a holistic perspective and the desirability of coordinated and coherent interventions by all the development actors to achieve maximum impact. The essential purpose of the UNDAF is to achieve coherence among the United Nations actors, whereas the CDF seeks to provide a framework for all the stakeholders in development, including bilateral donors, non-governmental organizations and the private sector.

Both, however, place the developing country itself at the centre of the process -- and this is indeed essential. There cannot be sustained progress towards development unless the government and people of the developing country feel that they themselves are genuinely in the driving seat.

If that essential prerequisite is kept in mind, I believe the CDF approach can make a real difference. The keys to its success will be:

a) Shared assessment of a country's priorities: I believe the CCA, in which the World Bank has been involved in a number of countries, could become the vehicle for this.

b) Convergence on policy and strategies -- we are already much closer than before, but there is still room for a rich policy dialogue between us. And

c) a clear division of labour among development stakeholders, based on their respective comparative advantages.

An open, productive partnership between the World Bank and United Nations agencies, funds and programmes is more than just desirable: it is an imperative if we are sincere about putting the interests of developing countries ahead of our own institutional concerns.

But this implies significant changes in the modus operandi of both institutions. At present, our working methods and institutional culture remain quite different, and partnership depends too much on individuals. What we are looking for is real partnership, where we all feel part of the same team rather than competing for leadership.

The lessons we learn must not be concerned only with the CDF, or the UNDAF for that matter. They must focus on the actual development achieved.

It is vital to remember that none of these acronyms -- CCA, UNDAF or CDF -- is an end in itself. All are means to an end, intended to help us make more of a difference to the real lives of individual people -- to help them achieve their most basic rights and to free them from absolute poverty.

CDF and UNDAF are only instruments. We must fashion them in such a way that they are instruments, not in our hands, but in the hands of developing countries themselves.

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