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Global Monitoring Report 2004: Sobering verdict on chances of meeting the Millennium Development Goals

Author(s):
International Monetary Fund. External Relations Dept.
Published Date:
July 2004
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Global Monitoring Report

On current trends, most developing countries will fail to meet most of the Millennium Development Goals (MDGs), according to the Global Monitoring Report 2004, which was publicly launched on July 7. It is the first in a series of annual World Bank-IMF reports on the progress being made to achieve the MDGs. Zia Qureshi, lead author and a senior advisor in the World Bank’s Global Monitoring Secretariat, and James Boughton, co-author and an assistant director in the IMF’s Policy Development and Review Department, reviewed the findings. Commentary was provided by Moisés Nairn, editor of Foreign Policy and former World Bank Executive Director; Gene Sperling, Senior Fellow at the Council on Foreign Relations ; and Ian Goldin, Vice President of External and UN Affairs at the World Bank.

According to the report, the goal of halving the number of people living on less than a dollar a day by 2015 relative to 1990—the first of the MDGs—will likely be met at the global level, Qureshi said, thanks to strong growth in Asia. Sub-Saharan Africa, however, is “seriously off track.” The picture is still more worrisome for other goals, particularly those related to health, including reducing child and maternal mortality rates, combating HIV/AIDS, and improving access to clean water and sanitation. Most, if not all, regions are off track in reducing child mortality rates by two-thirds, for example.

The report’s central message, Qureshi pointed out, is that, for the MDGs to be met, all parties—developing countries, developed countries, and international agencies—must scale up their actions significantly and urgently. Developing countries must accelerate reforms to achieve stronger economic growth, with Africa needing to double its growth rate. Developing countries must improve the delivery of health care, education, and other basic human services.

The report does note progress on the policy front, where improvements may be seen in all areas—macroeconomic, structural, social, public sector management—though there is much further to go. Progress has been slowest in improving governance and institutions, but even in this area there have been encouraging developments—notably, the New Partnership for Africa’s Development initiative. “Going forward, the core of the reform agenda is institutional,” Qureshi emphasized. “For the public sector, it involves improving the quality of governance and reducing corruption, and, for the private sector, it involves protecting market institutions, property rights, and the rule of law,” he noted.

For the IMF, the challenge is going to be to find ways to help countries maintain macroeconomic stability while growing strongly enough to meet their development goals.

—James Boughton

Progress on aid inadequate

For the developed countries, the report finds that, to date, actions have fallen well short of the development partnership to which they committed at the meeting of world leaders in Monterrey, Mexico, in March 2002. The report calls for stronger support from the developed countries, particularly in the form of more and better aid and more open access to their markets. While there has been some recent progress in the priority area of aid, it remains inadequate. Even if donor countries honor their post-Monterrey commitments to provide additional aid of about $18.5 billion by 2006, this amount is only about one-third of what is estimated to be needed. International agencies can also do more, by strengthening their support for country-led poverty-reduction strategies in low-income countries and by better helping middle-income countries avoid crises that can set development back.

What separates this report from others, Qureshi explained, is that it functions as an instrument of accountability—presenting a uniquely comprehensive and integrated framework for accountability in global development policies and making use of newly developed indicators to monitor these policies at the level of individual countries. The report is, first of all, a policy document for discussion by the Development Committee, the joint committee of the Boards of Governors of the World Bank and the IMF, and it was the main agenda document at the Committee’s spring meeting this year.

The report is also designed to keep the broader international development community informed. This joint report of the World Bank and IMF staffs was produced in close collaboration with a number of other international organizations, including the United Nations, the World Trade Organization, the Development Assistance Committee of the Organization for Economic Cooperation and Development, and regional development banks. “Going forward, we also intend to expand collaboration with civil society in this effort,” Qureshi said.

Boughton said that specifically, for the IMF, the challenge is going to be to find ways to help countries maintain macroeconomic stability while growing strongly enough to meet their development goals. He referred to the report as a first step in spelling out how to do this.

The Monterrey Consensus, Boughton continued, provides the framework for the IMF’s involvement in the MDG campaign, based on three main dimensions:

  • better policies in developing countries. Here, the IMF can offer its specific expertise in helping countries devise policies that promote macroeconomic stability and, working with the World Bank, improve investment climates and strengthen the private sector;

  • more and better help from developed countries. The IMF has a strong comparative advantage in promoting this, through its regular, ongoing dialogue with these countries. It has called for a more open trading system and urged developed countries to provide more and better-focused development aid; and

  • more effective work by international financial institutions. For the IMF, this means a more clearly defined role in developing countries, better support for the process of developing and implementing countries’ Poverty Reduction Strategy Papers (PRSPs), and a clear, rational alignment of the IMF’s financial support and policy advice for countries through its Poverty Reduction and Growth Facility, with PRSPs and the MDGs.

Real and personal accountability needed

Naím commended the report for taking very seriously its auditing role—specifically, its candidness in alerting the international community that “things are not going very well.” At the same time, he remarked, this first report is “very silent on what to do about it.” It should “say more about why there is such reluctance to do the obvious.” After a decade in which there was a global financial crisis every three or four years, he wondered, “why is it we are not assuming that there will be another financial crisis and what would this mean for countries’ abilities to achieve these goals?”

Naím added that the report could say more about the implications for the MDGs of a continuation of the trend of failed states—countries where large numbers of poor live, where institutions and aid delivery are ineffective, and where it is not possible to implement even basic, sound policies, let alone more complex policies of reform. In closing, Naím warned that “unless a political constituency in rich countries is developed and, in turn, creates real and personal accountability of people of importance who will pay the consequences if the MDGs fail, it is very unlikely that the MDGs will be achieved.”

Focusing many of his remarks on the MDG for universal primary education, Sperling commented that, although he found the section on education too brief, it was right in describing both the progress and limitations of the Fast Track Initiative, which is designed to address the data, policy, capacity, and resource gaps that constrain progress in achieving “Education for All.” Sperling agreed with Naím that, in the past, aid has had a very low profile in developed countries. The absence of a sizable and vocal constituency for aid policies, he argued, has hindered an appreciation of why development assistance is in donor countries’ own interest and of what they need to do to help poor countries.

Unless a political constituency in rich countries is developed and, in turn, creates real and personal accountability of people of importance who will pay the consequences if the MDGs fail, it is very unlikely that the MDGs will be achieved.

—Moisés Naím

While agreeing with Naím that “we are finding it most difficult to move from this broad analysis of the goal posts … to how to get there,” Goldin nevertheless cautioned against forgetting how much has been achieved so far. He specifically cited the overall decline in the proportion of people worldwide living on less than one dollar a day, which has dropped from 40 percent to around 21 percent over the past two decades (although the rate of absolute poverty in sub-Saharan Africa—where poverty is deepest—actually climbed from 42 to 47 percent over the same period). “The key question in my mind,” Goldin said, “is not why the developing countries have not done more but why the rich countries have not done more.”

Printed copies of the Global Monitoring Report 2004 are available for $26.00 from the World Bank. For more information, please see http://publications.worldbank.org/ecommerce/.

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