Preparing for life after the MDGs

By Cyn-Young Park on Thu, 03 July 2014

The establishment of the Millennium Development Goals (MDGs) by the United Nations in 2001 was a defining moment. It rallied a global effort in the fight against poverty, hunger, and disease, while promoting universal education, gender equality, and environmental sustainability.

There has been significant progress on the eight MDGs over the past decade, ranging from halving extreme poverty, reducing gender disparities in schooling, checking the spread of HIV/AIDS, to increasing access to safe water. However, new challenges have emerged while remaining ones are complex. Meanwhile, the 2015 deadline for achieving the MDGs is almost upon us, raising the question: where do we go from here?

Since the introduction of the MDGs, the development aid environment has changed significantly. As the world has become increasingly vulnerable to financial and environmental shocks, closer trade and financial linkages help propagate the shocks around the world regardless of their origins. We have also seen increasing participation and influence of developing countries, while developed countries contributions have stagnated and declined, particularly since the global financial crisis of 2008-09.

It is in this context that discussions about the post-MDG development agenda should be made.  Rapid growth in many developing countries especially in Asia, while lifting millions out of poverty, has been putting pressure on the environment. Growth has not been sufficiently inclusive, and rising inequality within countries threatens economic stability and sustainability of growth.

Although many developing countries have moved into the ranks of middle-income economies, many of their citizens remain poor. At the same time, human rights remain elusive in many parts of the world, while governance and security continue to be major challenges in many fragile and conflict-affected countries.

The MDGs have been one of the most successful global initiatives for poverty reduction and human development, thanks to clear targets and indicators that are tractable. But they are not without criticism. First, the MDGs have been criticized for what they missed.

The MDGs themselves have concentrated on poverty and access to social services, which may be due to readily available indicators for monitoring, compared to other complex and politically sensitive issues, such as human rights, social injustice, governance, and peace.

Second, despite overall progress, the country and regional performances in meeting the MDGs show vast disparities across borders as well as across different social, ethnic, and gender groups within individual countries.

Third, the MDGs largely overlooked the sustainability issues of development in economic, social, and environmental dimensions. The vulnerability of countries to climate change and natural disasters has not been sufficiently captured, while challenges facing middle-income countries have not been addressed.
 
In the post-MDGs era, the global development agenda needs to be broadened to reflect inclusive, equitable, and sustainable development, while allowing target flexibility for individual countries to reflect their own local conditions. Targets can be set in two layers: Absolute minimums at the global level in the core agenda, and more flexible national targets tailored to bring real gains in the country context.

The challenges would lie in the implementation and monitoring of progress. Globally accepted indicators for a more complex and broader agenda would be needed, while national data on socioeconomic conditions and specific target areas would need to be further strengthened.

The post-MDG development agenda will require more efficient and effective mobilization of development financing. Given the likely shortfall in aid flows from developed countries, many of which face fiscal constraints following the global financial crisis, additional financial resources need to be mobilized. This could happen through increased participation of developing countries, cooperation with the private sector, and use of innovative financing mechanisms.

With greater emphasis on national level targets in the post-MDG era, greater use of domestic resources can promote stronger ownership and foster better accountability. Improving tax systems in developing countries can also help on the governance and accountability front.

Many emerging market economies are also keen on extending development assistance for other developing countries. While there may be many win-win opportunities, these newcomers may not have the experience and know-how to realize these opportunities. As for private sector participation, public-private-partnerships (PPP) and innovative funding mechanisms have to fit into local contexts in order not to transfer undue fiscal risks and burdens. Where governance and institutional quality are weak, PPPs can imply high returns for the private sector and high risks for the public sector.

The development challenges remain daunting and the available resources are limited. So improving the quality of development finance would be crucial by establishing well-targeted policies and ensuring their effectiveness, instead of simply focusing on quantity.  

ADB has great potential to contribute effectively to the post-MDG development agenda by leveraging its rich development experience, now spearheaded by many dynamic emerging market economies in the region. Improving results also requires careful design of policies that take into account the specific situations of each country. This is another area where ADB can make a valuable contribution through its research and data analysis.

Accurate data and strong analytical support will help governments make more evidence-based decisions and pave the way for better monitoring of progress toward development targets.