The world has always been divided between the developed and the undeveloped, or at least for as long as written history tells us. Prosperity has been unequally divided over the globe, from the early days of human history. Powerful and lasting societies have formed in Eurasia, leading them to conquer the rest of the world where societies were smaller and more primitive. Although the idea might be appealing (to Eurasian people) that development is determined by (initial) cultural or genetic factors, this is not necessarily a plausible explanation. An interesting read by Jared Diamond is the book called Guns, Germs and Steel (1997), in which he argues that it is exogenous factors that have allowed the relatively high development of this region. The region Eurasia itself makes it suitable for human development, for instance due to the favourable conditions for agriculture. This extremely brief history lesson is still very relevant today. Although the other continents have clearly played catch up with some success, the most developed countries today are primarily European or inhabited by decendants of Europeans. The inequality in development created by environmental factors has led to Europeans dominating the world as we know it today. The countries we call ‘developing’ today have usually suffered greatly under that dominance. Some of that concerns indirect blame, such as the diseases that arrived with the Europeans. Some of it leaves the conquerers less innocent, such as slavery and systematically stealing land from the original inhabitants. Often, the situation is not that black and white. Luckily, Europeans today do not have to feel that guilty about the developing world. Through development aid and economic cooperation on a global scale, developed and developing countries are working together to improve the lives of all humans. International organisations like the United Nations coordinate efforts to improve economic and human development, working with governments, NGOs and institutions like the World Bank and the IMF.
In 2000, the United Nations established the Millennium Development Goals. Although the 8 goals themselves are quite general, the MDGs were made credible by specific targets associated with each goal. The aim was to achieve these targets by 2015. Of course, the goals were ambitious and progress was made more difficult by the financial crisis. But much progress was made in the past 15 years, leading to the extension of the program in what will be called the Sustainable Development Goals. In this article, a student in economics and a student in business administration will examine the original 8 Millennium Development Goals. The former will analyse what the problems are, while the latter will propose how we can move forward in developing the world.
To keep the information flow manageable, we now present the first two goals of the list. Come back next week for the remaining four! [Edit: find Part 2 here]
1. Eradicate Extreme Poverty and Hunger
Economics: Food is at the basis of human development, which might explain why this is the first goal on the list. It is difficult to imagine the extent to which hunger takes place around the world, and the impact it can have on a population. An estimated 842 million people are undernourished, including around 99 million children. In the short run, hunger affects human dignity, the ability of people to live an independent life, and can promote inequality or lead to conflicts. In the long run, hunger can have severe and lasting effects on an economy. Children who are malnourished often suffer from health problem throughout their entire life, as the lack of nutrition leaves permanent damage. It affects them personally, in their welfare and their lifespan, but it also leaves an aggregate effect on the development of the country. For a country to develop, the building blocks need to be in place. The first building block is human capital. Fighting extreme poverty and hunger is therefore a primary requirement for a country to grow.
Business: “If you give a man a fish, you feed him for a day. But if you give him a fishing rod, you feed him for a lifetime”. This proverb reflects both literally and symbolically the direction which foreign aid and charity programs should follow. Instead of providing people with charitable material donations, the organizations should teach people how to cultivate agricultural land with use of innovative techniques, how to organize the production or how to exchange goods. In the long term, developing countries cannot rely on temporary gifts, but they must be given tools to create their own wealth. Corporate organizations are actually the ones who have a stake in helping the developing countries in a sustainable growth. Since the demand in developed countries is stable/decreasing, developing countries represent still an unsaturated market with a huge unfulfilled demand potential. Therefore, companies should seek expansion opportunities in Africa and initiate creation of trade connections. Certainly, first people have to make money to later buy products, but that is the thread that links the story: give people a place to work, so they will make money and will not need donation but they will be able to buy the food. Alternatively, people can be given some amount of money for a start. For example, a start-up called GiveDirectly transfers about $1,000 to the poorest families in African villages, while making no rules or suggestions about how the cash should be spent. The research shows that people who get such a transfer enjoy a 50 % earnings boost, thanks to the fact that they can determine what their crucial need is. To learn more about this interesting initiative click here. Besides, according to a recent report made by the World Resources Institute, about one-third of all food produced worldwide, worth around US$1 trillion, gets lost or wasted in food production and consumption systems. If there could exist an business idea of how to efficiently use and relocate these resources and outputs, it would create a great opportunity to solve the food shortage problem while eliminating the need for producing more.
2. Achieve Universal Primary Education
Economics: No student will deny that education is beneficial. But this goal does not even consider higher (tertiary) education. It promotes the most basic of education: primary school. If we think back to our primary school period, it seems that we learned two basic things. First, we learned how to learn. That means we learned how to read, how to calculate and how to form an opinion. Second, we learned how to act in a group. We learned discipline when the teacher was talking, and we learned how to cooperate with other children. These are skills more than knowledge and they are the building stones for a society to act as a collective of individuals. Around the world, one out of ten children do not attend primary school, already a vast improvement over the situation 15 years ago. Giving people the tools to develop themselves can boost the economy in the short run through, for instance, entrepreneurship. In the long run, literate parents can pass on their skills to their children. They are also more knowledgeable on how to care for their children well. This creates a positive chain of education and development, supporting all other goals on this list.
Business: Innovation and out of the box thinking can help in partially solving this problem. According to research made by Pew Research Centre, which surveyed about 1,000 people in each African country, approximately 89 percent of adults now own a smartphone or basic cell phone in South Africa and Nigeria, 83 percent in Senegal and Ghana, 82 percent in Kenya, 73 percent in Tanzania and 65 percent in Uganda. This creates a powerful chance for education. The mobile phone technologies help in distributing educational materials, support reading, and facilitate a peer-to-peer learning. Mobiles are streamlining education administration and improving communication between schools, teachers and parent. While mobile phone learning is not the ultimate solution for coping with illiteracy, the use of new technology can certainly help in educating people, especially in the areas where traditional education is problematic.
Come back next week for the other 4 Millennium Development Goals! [Edit: find Part 2 here]