February 2004

Perspective:Information for development

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When talking about information for development it may be useful to first outline what we are talking about. The notion 'information' has (at least) two aspects: the content of the information, that is, what sort of information are we talking about, and the delivery mechanism, including the target audience, the technology used and the sustainability of the operation. The notion 'development' has, of course, a range of aspects, including the development strategy, the policy and socio-economic environment, the institutional environment and governance, and the delivery mechanism, including target systems, target audience, and the actors and institutions involved in the developmental process.

Strategic analysis
In order to produce a development strategy one needs to define the system one is talking about, identify subsystems relevant to the analysis, perform strength-weakness-opportunity-threat (SWOT) analyses for each of those subsystems (or 'segments') and environments, define the situation one would like to reach at some stage in the future, and then design a 'roadmap' for implementing the strategy. Although it is not the intention of this paper to elaborate extensively on the notion of 'strategic analysis', I will briefly discuss the stages of such an analysis, as it may be relevant to actors involved in the developmental process.

The first stage of a strategic analysis is to define what one is talking about. This may be an entire country or region, in which case the analysis obviously would be very complex, or it may be a rural area somewhere in South Asia, in which case the analysis may be less complex, although not necessarily very much so. In the case of a country or region, one would need information on an aggregate or macro-economic level and one would probably address policy makers at the national level as the primary target audience. In the case of a rural area somewhere in South Asia, one would need information on natural resources and socio-economic parameters, such as income and income distribution, language, caste, class, and the role of gender, whereas the target audience may be district-level planning officers or extension agents, or farmers organizations. It is important to note that one should not only define what comprises the system, but also what is not part of it and how the system interacts with the environment. In figure 1, the system is represented by a rectangle, and the area outside the rectangle is the environment.

Once the field has been defined, one has to determine where a particular system under consideration is located in the broadly defined field. In the case of a country, one can make use of the World Bank Indicators, the UNDP Human Development Reports, reports of State Planning Commissions, or reports of other organizations that work at the national level. In the case of a particular rural area, one would need information on the status of natural resources and agricultural systems, education and health, socio-economics, including physical and knowledge infrastructure, access to input and output markets, availability of rural credit, income distribution, class or caste, ethnic parameters, language, culture, the role of gender and many other parameters. On the basis of a suitable segmentation, and an analysis by segment, one can determine where a particular subsystem is located in the broadly defined set of rural systems. In figure 2 the subsystem under consideration is represented by an open dot within the relevant set of systems. Of course, a dot in a rectangle is a rather poor representation of the outcome of a complex analysis, but in analogy with the concept of 'phase space' in physics, N coordinates would determine one point in a N-dimensional space. For example, 2 coordinates (x and y) determine one point in a 2-dimensional space, and three coordinates (x, y and z) determine one point in a 3-dimensional space, and so on.

Figure 1 What are we talking about?

Once the position of a specific system in a set of systems has been determined, one would have to define the developmental objectives: what does one want to achieve and when? In the case of a country one of such objectives may be to reach 'developed country' status by a certain time (e.g., 2020). One measure for such a status is the per capita Gross National Income (GNI per capita) of a country, according to the methodology used by the World Bank. Although significant as a parameter, GNI per capita does not explicitly measure literacy, access to health services and sanitary facilities, the role of gender, etc. One may wish to take the Human Development Index, used by UNDP, as another parameter. Also, there may be country-specific national indicators one would wish to use. In the case of a particular rural area, one may define targets of income and income distribution, agricultural production and/or diversification, conservation of natural resources, literacy, health, infrastructure, or gender equality.

Figure 2 Where are we? Segmentation. Analysis by segment. Portfolio picture.

Essential elements in this process are the strategic segmentation and the SWOT analysis by segment, that is, for each of the segments one has to determine what the strengths and weaknesses are of the segment under consideration, and, based on this, what the opportunities and threats are that are posed by the environment. For example, in India one may feel that the IT sector is very strong, because of the availability of a highly qualified, skilled and low-cost labor force (strength) but that most of the activities in the IT sector are in the production and service areas, rather than in the design and development of software and systems (weakness). The globalization and outsourcing of IT activities (including call centers, etc.) to achieve reduction in cost by multinational corporations may be perceived as an opportunity, but the increasing competition from other Asian countries, the state of the global economy and the ageing and overstretched infrastructure in the country may pose threats.

Similarly, a specific rural area may have good soils, ample water resources and skilled labor (strengths), but may have limited access to rural credit facilities, and input and output markets (weaknesses). There may be rural development schemes, which could help the area to gain access to credit and markets (opportunity), but the area may be far away from urban centers and thus not able to compete with rural areas closer to such centers (threat).

Figure 3 Where do we want to go? SWOT analysis by segment. Portfolio picture.

The definition, by segment, of the developmental objectives, again defines one point in the N-dimensional space referred to earlier. This point is indicated in figure 3 by an open star.

The next step would be to develop a strategy to reach the specified goals within a certain timeframe. Such a strategy should specify the roles of all actors involved in the process, specify a clear time path and contain quantifiable indicators ('milestones') against which the progress can be measured (figure 4). Unless we have such a 'roadmap', we cannot implement our strategy. Unfortunately, some development strategies do not come much further than colorful reports on the desks of the planning agencies.

Figure 4 How do we get there? Analysis by segment. Implementation plan: actors, time path and milestones. Portfolio picture.

An important step in the implementation of a development strategy is the question of change. A country or a specific rural area have an existing infrastructure and are involved in a developmental process, irrespective of the plans we put on the table. The question therefore is where we are going if we keep doing what we are doing. Do we reach the objectives we (or the stakeholders involved in the process) have set within a given timeframe or not? That is, where do we go if we do not change course? This is indicated in figure 5 by the solid arrow.

In this particular case we do not reach our target if we keep doing what we are doing. This is not an unexpected outcome, as one would not normally go through an elaborate process of strategic planning if one would be very pleased with the way things are going. Normally one embarks on a strategic planning if one fears that targets might not be reached, objectives are not clear, or if there is no explicit strategy at all. Hence, the implementation of a development strategy will often require changes in the way people act and things are being done. As most people tend to be reluctant with regard to change, the successful implementation of a development strategy requires the involvement and commitment of all actors and institutions involved in the process. This involvement should not start at the end of the process, when the strategy has already been defined, but at the beginning, when the position of a subsystem or segment in the wider field is examined and when the developmental goals are being defined. That is, the implementation of a strategy for development is (or should be) an iterative and participatory process. Often this is not the case and this may well be the single most important cause for the failure of many development projects.

Figure 5 Where do we go if we do not change course?

Hence, the important issue in the implementation of a development strategy is one of change, and in most cases actors or institutions involved would have to refocus their activities. The refocusing of activities is an iterative process that continues until the objectives are fully achieved (figure 6). This is also an important point. In some development projects it appears that once the course is set, there is no regular monitoring and feedback on the achievements, and within a short time one may be off course. Hence, the implementation process requires the definition of 'milestones' and the regular monitoring of progress made. Results should be discussed regularly with all actors involved and corrective measures should be taken if necessary. Another aspect is the funding of a developmental process: in many cases funding dries up half way the process, thus threatening the continuity of the effort. Development plans therefore need initial funding by governments or other donors and sound business plans to ensure the continuity of the operation.

Figure 6 Do we want that? No? Then change course!

In summary, the objective of a strategic analysis is to develop and implement a sector-wise strategy for sustainable, integrated and equitable development of urban and rural areas, involving the private sector, the government, the academia and NGO's. Specific aims could be sustained economic growth, poverty alleviation, achieving social emancipation of women and backward sectors of the society, conservation of natural resources and the environment, and others.

The issue of 'information for development' should be an integral part of a strategic analysis. Without access to (or the provision of) relevant and adequate information, a development project is unlikely to succeed. Hence, information is an essential component of any developmental process and should be an integral part of the planning of such processes. Information should be needs driven, accessible to all social strata, in all relevant languages, and in an economically sustainable fashion.

Strategic segmentation: An example
Strategic segmentation is an important part of a strategic analysis. One has to differentiate between systems and identify their essential components. If the object of analysis is a country or a state (province), four systems or segments may be distinguished: Urban Systems, Urban Fringe/Slum Systems, High-Input Agricultural Systems, and Low-Input Agricultural Systems (see figure 7). Of course, one could think of other forms of segmentation and the four systems referred to are still defined at a fairly high level of abstraction, but they represent recognizable entities in the geographical space and have some relevance with regard to the provision of information for development.

Urban systems refer to the cities where most of the private sector driven economic development takes place. Urban systems are connected with each other and with the outside world (arrow in figure 7). They interact strongly with high-input agricultural systems, as they depend on them for their food supply. At the same time, they provide inputs for these systems, including knowledge and information. Urban systems have highly developed information infrastructures: written media, telephones, radio, TV, satellite communications and Internet connectivity. Of course, 'urban systems' could be further differentiated, for example, in cities with more and cities with less than, say, one million people. The information needs of these systems would include: e-governance, job opportunities, availability of products, services and markets, including housing, health and education, global markets, travel, immigration and visa procedures, global educational and job opportunities, and access to Internet for information, chatting, music, fashion, movies, etc.

Urban fringe or slum systems are the areas surrounding cities where the urban poor assemble and where most of the rural poor that migrate to the cities end up. Generally, infrastructure, and access to health, education, housing and sanitation are poor. Interaction with the prosperous urban systems is largely limited to the provision of cheap, unskilled labor. Interaction with the more prosperous high-input agricultural systems is also quite limited, as the purchasing power of the peri-urban poor is limited. Many of the people in the urban fringe systems depend on government schemes and subsidies for their livelihood. The information needs of these systems would include: e-governance, housing, sanitation, drinking water, health, education and other community services, subsidies, projects and schemes of the Government and NGO's, and job opportunities.

High-input agricultural systems are generally producing for rural or urban markets. They need access to credit, transportation, and input and output markets. Farms are relatively large and are often located on the better soils, have access to (irrigation) water, use improved crop varieties, fertilizers and biocides, as well as fossil fuels for their agricultural machinery. In addition, they often use local labor during planting and harvest. They interact strongly with urban systems, but their interaction with urban fringe systems and low-input agricultural systems is largely limited to the use of contractual or daily labor and the provision of food at subsidized prices. The information needs of these systems would include: e-governance, agriculture and extension services, weather forecasts, input and output markets, transportation, credit facilities, subsidies, prices, off-farm job opportunities, education and health (tele-)services, and Internet connectivity.

Low-input agricultural systems still make up the largest part of the rural space in most low-income countries in Asia. They are basically subsistence systems and often located on the more marginal lands in relatively remote areas, have no access to irrigation water, other than supplementary irrigation for vegetable crops, and use little, if any, inputs in agriculture, other than landraces, organic manures and their own labor. Infrastructure is generally poor and access to health, education, information and other services is limited. Interaction with other systems is limited to the provision of labor and some products, such as fruits, forest products, herbs, and products of home or cottage industries, such as baskets, handlooms, and others. There is a need for off-farm labor opportunities and there would be scope for establishing small-scale industries, provided infrastructure, accessibility and connectivity can be improved. The information needs of these systems would include: e-governance, agriculture, crops, varieties, control of pests and diseases, agro-forestry, rural development schemes, e.g., soil and water conservation, or in situ biodiversity conservation, off-farm job opportunities, education, health- and sanitation-services and access to safe drinking water, and disaster management: where to go, what to do.

The information needs are only given as examples, and are not intended to be comprehensive nor necessarily listed in order of priority. They are meant to illustrate that the information needs differ between systems: poor people do not need information on the NY Stock Exchange or car loans, whereas the high-income sections of the society would not be (or less) interested in rural development schemes or community services.

Strategic segmentation: Trends in time and space
In order to identify threats and opportunities one should first try to assess the trends in the development of the system under consideration. Two examples of such trends are given below: available land resources and urbanization

Per capita available arable land is low in South (SA) and East Asia (EA), in the range of 0.11-0.16 hectares. This is much lower than the available land resources in the high-income countries (H) and also well below the world average (W). The implication is that there is an enormous pressure on the land, in order to feed an increasing (urban) population. Increases in food production have to come from increases in productivity per unit arable land rather than from expansion of the arable land area. The problem of low availability of arable land is compounded by increasing land degradation, through salinization and/or alkalinization of irrigated land, soil pollution, soil erosion and nutrient mining, and is further compounded by the loss of biodiversity, disrupting natural ecosystems, and the exhaustion of groundwater resources and deterioration of their quality.

The trends in the availability of land resources are also rather disturbing. In India, arable land resources decreased from 0.35 hectare per capita in 1960 to 0.16 hectare per capita in 2000. If this trend continues, these numbers would be 0.108 hectare per capita in 2020 and 0.073 hectare per capita in 2040. Of course, extrapolation of an historic trend is questionable, and population growth, the major factor in the declining per capita arable land resources may well decrease, thus slowing down the expected decline. On the other hand, loss of arable land due to urban expansion, infra-structural needs and other factors may well increase. Therefore, the conclusion seems to be justified that per capita arable land resources will decline significantly over the next decades, while the demand for food will be increasing. This will put increasing pressure on the available land resources and India can only keep feeding its growing population if the productivity of the existing arable land is increased significantly. What applies to India, applies to many other countries in the region, notably China, where arable land resources are already at a low of about 0.11 hectare per capita.

Another trend is the increasing urbanization. At present, most of the population in Asia is still living in the rural areas and urbanization is below the world average and far below the level of urbanization in the high-income countries. However, urbanization in Asia has increased significantly over the past two decades and this trend may be expected to continue in the future, driven by rural poverty and the growth of urban economies. This trend will necessitate the creation of job opportunities in the urban centers and put further pressure on the land resources available for agricultural production.

Socio-Economic and policy environment
The Asian region is highly complex and Asian countries cover a wide range of developmental stages, ranging from very poor to highly developed, and with widely different degrees of access to natural and human resources. Asia as a whole has a tremendous potential and is likely to be the economic powerhouse of the future. However, in the present situation there are still serious constraints to socio-economic development, which have to be overcome in order to realize the potential of the region. These constraints range from poverty and ignorance, and unresolved conflicts that result in high military expenditures in the region, to deterioration of limited natural resources and regularly occurring natural disasters. A few of these constraints will be briefly discussed in the following sections. However one should be clear that this listing is by no means complete nor does it even necessarily cover the most important issues.

GNI per capita: Poverty
One issue that is no doubt important is the prevailing poverty in the region. In a number of countries, tremendous economic progress has been made over the past decades. However, in many countries, poverty, illiteracy and ignorance still persist. South Asia alone has more absolute poor (people living on less than the equivalent of 1 US$ a day) than all of Africa.

When the GNI per capita of the high-income countries is plotted on the same scale as that of South and East Asia, South Asia is not visible at all, and East Asia appears as a tiny little bar. Both regions are also below the world average. Poverty remains the main problem of the region and poverty alleviation should probably be the major objective of government policies for decades to come. Even though economic growth in many countries in Asia is impressive, in the range of 5-10% per annum, the overall effect of this on poverty may still be fairly limited. One reason for this is that much of the economic growth is concentrated in the larger urban areas and has little effect on the rural poor, and another reason is the logic that 10 times a small number is still a small number. For example, if India would double its GNI per capita in 10 years, this would result in a GNI per capita of the order of 900 US$ per capita. No doubt, this would be a commendable achievement, and much needed by the country, but 900 US$ is still a fairly low GNI per capita, also in view of the fact that other countries are also likely to increase their GNI per capita and their economic competitiveness during the same period. Hence, India would still be at the lower end of the economic spectrum, even though a doubling of the GNI per capita may be expected to have a significant positive effect on the Indian society.

The problem of low GNI per capita in the region is further compounded by unequal income distributions in many Asian countries. Although this phenomenon, of course, is not limited to Asia, it appears that some of the poorer Asian countries have more unequal distributions than, for example, high-income countries in Europe. This implies that the gap between rich and poor tends to be higher, in relative terms, in some of the poorer Asian countries than in the higher-income countries in the region (e.g., Japan has a notably 'flatter' income distribution). This implies that the equitable distribution of economic growth (income) among the different strata of the population is a major issue

It may be noted here that it is difficult to see how such differences in GNI per capita in the world (and within countries) could be sustainable in the long run. It would seem that high-income countries would have to urgently address the issue of poverty and unequal distribution of wealth between countries. Similarly, developing countries would have to address the issue of unequal income distributions. In my view it is unlikely that the persistence of such gross inequities in the world could, in the long run, generate a stable and peaceful world (free of 'terrorism').

Current revenue and government spending
Other issues relevant to development strategies are the revenue collection by national governments, and the way government budgets are spent. Current revenues are low (less than half) in Asia as compared to the high-income countries and the world average.

In other words, in the region with the highest number of absolute poor in the world, where poverty alleviation is (or should be) the highest priority, government budgets are less than half the world average, in terms of % of Gross Domestic Product (GDP). The high payments for interest on domestic and international loans, and the high military expenses, due to unresolved ethnic conflicts or disputes between countries, compound this problem.

In summary, low-income countries in Asia not only face poverty and unequal income distributions, but also low current revenues and high expenditures for servicing of debts and military expenditures. As a result, government budgets for alleviating poverty are relatively low and probably much lower than required to solve the problem of poverty within a reasonable timeframe. Hence, alleviating poverty in the world is a global issue, and not just a national concern

Purchasing power parity
It is a well-known fact that 1 US$ has a higher purchasing power in low-income countries than in the USA. To account for this, the World Bank uses the concept of Purchasing Power Parity (PPP) (e.g., The World Bank, 2002, 2003a). For example, in a country like India, the purchasing power of 1 US$ is about 5.2 times higher than in the USA. However, the PPP factor tends to decline quite steeply with increasing GNI per capita. This is illustrated in the figure below, where the PPP factors of Asian countries are plotted against GNI per capita. The decrease in the PPP factor implies that the 'advantage' of a high PPP factor, that is, a relatively high purchasing power of the US$ in a low-income country, is quickly dissipated if the per capita income increases, reflecting an increased cost of living as a corollary of economic growth. The decrease in PPP does not only affect real economic growth in terms of purchasing power, it also poses problems to sections of the society that are lagging in economic growth, such as low-input agricultural systems.

The notion of PPP implies that a country like India, with a GNI per capita of 450 US$ in 2000, would have a much higher per capita income in terms of purchasing power: 2340 PPP$ per capita. However, what applies to India also applies to other countries. Hence, whereas India is no. 159/60 in the US$ ranking, between Zimbabwe and Guinea, it is no. 153 in the PPP$ ranking, still in between Zimbabwe (which has moved up a few places) and Guinea. Of course, these data relate to the year 2000 and do not, among others, reflect the recent economic problems being faced by Zimbabwe, but they illustrate a trend.

Economic growth
There appears to be some mysticism regarding the issue of PPP when calculating economic growth. In some calculations, the GNI in PPP dollars is taken as the basis for calculating economic growth. This logic would imply, however, that if a country had reached the same level of income as the USA, that the PPP factor would still be, say, 5 or more. Unfortunately, this is unlikely to be the case. When the GNI per capita increases, the PPP factor decreases. For example, in a country like Japan, the PPP factor is actually smaller than 1, reflecting the fact that 1 US$ has a lower purchasing power in Japan than in the USA.

If we take India as an example, and assume for simplicity that the rest of the world would be at zero GNI per capita growth during the rest of this century, whereas India's GNI per capita would grow at 5% per year, then it would take some 62 years for India to reach high-income or developed country status, i.e., a GNI per capita of 9,266 US$ in 1999 (The World Bank, 2002). The GNI per capita in PPP$ would then be 20,152 $ per capita. If India's GNI per capita would grow at 10% per year under the same conditions, then it would take about 32 years to reach this level. Unfortunately, even an assumption of a sustained growth in GNI per capita of 5% per year in real terms already seems to be fairly optimistic, as the population keeps growing (currently at slightly less than 2% per year in India) and the economies of the high-income countries also keep growing. The figure below illustrates that the PPP factor decreases when the GNI per capita increases: in relative terms the difference between US$ and PPP$ is largest in the lower range, in absolute terms the difference is larger in the middle range.

Hence, it may be concluded that it is likely to take several decades before a country like India would have reached 'developed-country' status, defined in economic terms (i.e., high-income status). However, in terms of social and other parameters relevant to the well-being of the population, much progress could be made if the development strategy is sharply focused on those parameters.

Institutions and governance
It has been argued that developing countries need good governance and appropriate institutions in order to realize balanced and sustained socio-economic development. 'Good governance' refers to a situation of democracy, appropriate institutions, social justice, transparent procedures, respect for human rights, the absence of corruption, and related factors.

The issue of corruption is yet another aspect that needs attention. As there are few objective measures of 'good governance', the 'Corruption Perceptions Index' (CPI) may be taken as a proxy for good governance. The CPI appears to be one of the few international measures for 'good governance' currently available. Clearly, thi



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