IA Forum: Your book 'The Bottom Billion' has been widely praised for finding some middle ground between Jeffrey Sach's 'The End of Poverty', which calls for an increase in development aid, and William Eastlerly's book 'The White Man's Burden', which is more cynical about foreign aid. Why did you decide to write your book, and did you set out to try and find some kind of middle ground?
Prof. Paul Collier: I decided to write the book really because I felt what had happened over the last five years or so was that the general public had become interested in development issues, and that politicians were increasingly setting their policies in light of what citizens think. This is fine, as long as citizens are well-informed.
But I felt that many citizens were not very well-informed. The reason why citizens had got interested is that they had been energized by development societies and NGOs, which is all fine, but of course the process by which they get the issues onto the agenda are also in danger of trivializing the agenda. I think it's a genuine danger. And so it is the responsibility of people like me to try and, if you like, make the agenda more sophisticated and get citizens up to speed on the issue.
If you look at other areas of policy, there have been dramatic improvements in the quality of debate. If you think about, for example, the quality of debate on domestic economic issues 30 years ago, they were terrible compared to some of the debates now. People understand the core issues like inflation very much better than they did 30 years ago. And so citizens have got to get up to speed.
Did I deliberately seek the center ground? I don't think it's unreasonable to describe it as the center ground. But what I perceive is that across the political spectrum – left, center and right – is that there is a lot of support for what I am saying, and so I think there is the basis for building a much broader constituency.
IA Forum: Has the media been remiss in holding NGOs properly to account?
Collier: I think there is an accountability issue with NGOs. There is an architecture for scrutiny of traditional agencies such as the World Bank, USAID and [Britain's] Department for International Development – there are systems of scrutiny and independent evaluation. They're not perfect, but at least they are there and functioning.
Now there is a lot more power for the NGO community, but there is no equivalent system of accountability. So you need to build those systems of accountability. I think the NGOs have manged to acquire a situation where there is a lot of trust among citizens, because they have positioned themselves as if they are noble and dispassionate, whereas sometimes they're not. So there needs to be a much better system of scrutiny. And the press really should be doing that.
IA Forum: Some have argued that the notion of human rights is often being been stretched to include many other rights, such as to a job or a level of income, and that this is proving unhelpful. Do you agree?
Collier: I think the rights based approach certainly has been over-extended. There are some things that really clearly should be talked about in the language of rights, such as the right of citizens to information and the power of scrutiny and accountability of their own government.
But when we move to the things that are basically describing the level of income, this is really about economic growth strategies, and by talking in terms of rights it kind of misses the point. Income isn't something that is dropped from heaven as a right – it is something which people have to form by harnessing the opportunities that they have in the world economy. Strategies of growth have to be tailored for the opportunities and limits that each country faces. And my book is an attempt to tease out what these strategies will look like in different circumstances, rather than just making demands for a certain level of social provision.
IA Forum: What needs to change in terms of addressing this challenge?
Collier: Firstly, change needs to come from within these countries, and it will gradually do so. But they need to win their own struggles and their own battles to get reforms adopted. But there are things that you can do that can either make that battle much easier - or much harder - and at the moment we're not doing them. There are things we need to do to help the reformers within these countries, but essentially it is their struggle, not ours.
IA Forum: Your book mentions four common traps the poorest nations are often caught in.
Collier: There are four which I think account for most of the problems. In no particular order, the first is the conflict trap, such as civil wars. Until you can get security, it is very hard to get economic development going. A lot of small and low income countries are not in a position to provide themselves with security to get themselves out of the trap.
Another is being landlocked without any obvious natural resources. Being landlocked closes you off from a lot of global opportunities and so if you are landlocked without natural resources, your best bet is to go into your neighborhood. But whether you can do that depends on whether the neighborhood itself is economically successful. But although landlocked countries are at the epicenter of the poverty problem, they are not actually the logical place to start solving the problem. You have to start fixing the problem with the countries that have more promising opportunities.
IA Forum: So some countries are more promising?
Collier: I think economists have a very poor record of spotting these things. A lot of countries could turn round. There are two big opportunities. One is the resource rich countries. Nigeria for example has loads of oil but hasn't done anything with it. But it is not universal – a country like Botswana managed to harness diamonds quite successfully. So in that category the essential issues are really struggles over the governance of public spending. But these things can be very unpredictable. There has been a struggle going on in Nigeria over the last few years to try and reform. And they might win, in which case there is a huge opportunity to be harnessed.
The other big opportunities are the coastal, resource-scare countries, a country like Kenya. In principle they could break into global manufacturing markets, garments, that sort of thing. The big difficulty there is that Asia has already done that. Asia has already built up these clusters of manufactured exports, and so it is a chicken and egg problem – Africa doesn't have these clusters and so costs are higher. One way of dealing with this could be countries in Europe of the United States or Japan offering some degree of privileged access for a while. But the only country which does this effectively is America. Europe has a scheme called 'everything but arms,' but which hasn't worked at all.
IA Forum: And the other two traps?
Collier: The third trap is the resource rich. Resource rich is a trap because usually, you look at Nigeria, it leads to very poor governance. The final trap is just poor policy, typically in small countries, the reform process is slower because they just don't have the critical mass of education, of informed people. For example there are not enough people to support a financial newspaper, something like that. So you don't get the internal debate that you get in, say, India. The pace of reform is slower and you are more locked into poor policies.
There is also a kind of 5th trap – the kind of missed the boat trap. Now that Asia is well established in global markets it is that bit harder for Africa to do so.
IA Forum: You've talked about Asia having developed first. Why Asia and not Africa?
Collier: It didn't take much really. I think you need to go back to about 1980. Before 1980, nobody really had broken into global manufacturing markets because the clusters were in Europe and America and they gave them huge cost advantages. About 1980, the wage gap between Europe on the one hand, and developing countries on the other, got wide enough that it more than offset the benefits of these clusters, and so manufacturing started to shift. And it then begins to shift to wherever is the nearest congenial environment.
At that point Asia had already started to reform, and you had pockets in Asia that were ahead, particularly in areas like economic governance and economic policy. And that advantage doesn't have to be big, it just has to be there and then it is cumulative, because then you get the cost benefits of these new clusters. And so Africa misses the boat.
In the 1980s Africa was just a terrible scene of poor policy and poor governance. If you look at Africa now, it is very much better, but it has reformed more slowly than Asia. I think because the typical African country was smaller, had less education, and so was less able to develop an eternal critique of what was wrong.
IA Forum: Thank you for your time
Paul Collier is a professor of economics and director of Oxford University's Centre for the Study of African Economies. He is the author of the book 'The Bottom Billion'
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