For most people in the world, living standards have been improving, with average per capita income levels more than doubling over the past two decades. However, the poorest twenty percent of human beings are falling sharply behind, suffering from the lack of decent housing, education, or health care. Our challenge is to narrow these gaps by restoring the "credit-worthiness" of poor, debt-burdened countries and enabling their economies to begin growing again. If we are to reduce the gap between the haves and have-nots, we must accomplish this in a world increasingly dominated by financial institutions controlled by the haves. Aid to the poor must become much more cost-effective and innovative than before if we are to overcome the phenomenon of "aid fatigue." I want to propose ways of doing so.
The poorest people usually live in isolated rural areas, until recently beyond the reach of the electric grid networks and telecommunications systems. Today, however, it is possible to produce energy at the local level and deliver education and other services to remote places. This can improve the productivity of rural people living in developing countries and, in turn, raise their income and bring them into the mainstream of 21st century economic life.
Stand-alone energy technologies make unnecessary any connection to costly electrical transmission networks. These new systems of village power generation are still relatively expensive in absolute terms, but it becomes worthwhile to invest in them if we also take account of their non-financial benefits. The widespread introduction of these energy sources into rural communities offer enormous advantages for health, education, and the environment. It will enable villagers to light their homes and public places, cook without firewood, drill deeply enough to secure clean groundwater, and use machines for lifting and carrying out heavy chores. The key to lowering costs is to introduce stand-alone technologies that by-pass the capital-intensive technologies with which you and I are familiar.
As President Nelson Mandela recently noted, most of the developing world "has no experience of what readily accessible communications can do for their society and their economy." A World Bank document shows that "modern information infrastructure can create 'the end of geography' and allow isolated countries and regions, which often are the poorest, to participate in the economic process."
Take education, for example. "Distance learning" involves moving electrons instead of people to teach, whether the distance separating teacher and student is near or far. From primary school onward, quality education can be delivered to the children of the rural poor. Interactive technology gives them access to the highly qualified teachers of their country's major cities. The local teachers would be responsble for maintaining discipline and helping students complete their assigned homework.
The young generation in rural communities need to acquire competence in the use of the technology of the information age. The longer the gap exists in educational standards, the more difficult it will be to make up for lost time. The gap between the have and have-not worlds will continue to widen, perpetuating dependency.
Educating young women in remote villages is deemed by have the highest rate of return of any investment. In particular, by enabling women to gain more command over their lives, education restrains population growth.
Moreover, preparing young rural people to work in the world outside the farm is vital if they are to be employable in the service and manufacturing industries located in towns and cities. Village industries could become feasible on the basis of the new low-cost electric power generated by sun, wind, biomass, or nearby streams and rivers, and the information technologies that this energy makes possible. One important side effect is that these innovations allow the males of the household to find off-farm employment close to home.
The initiatives that have been mentioned here are not pie-in-the-sky dreams, but realistic uses of "appropriate technology" that are already underway. Until now, however, the intro- duction of modern technology has been undertaken only on a small scale. What is new is the proposal for a coordinated international effort to accelerate these innovations.
The cost of implementing a global-scale program is likely to be substantial. It has been estimated by the authors of the 1994 Human Development Report that $30 to $40 billion per year would be needed to wipe out the worst forms of poverty in the world. Another estimate of financial requirements for an effective poverty alleviation program calls for about 1.5 percent of the GNP of the industrialized OECD countries, or a tripling of the flow of official development assistance. The proposed program would replace many of the other traditional programs, thereby reducing those costs-though it is difficult to determine by how much.
In any case, there is a clear need for new sources of financing. Proposals toward that end include the imposition of royalties on commercial operations using and polluting the "global commons," such as the high seas, the upper atmosphere, and Antartica. Other proposals suggest funding from large multinational corporations, such as IBM, Microsoft, Sony, and Philips, along with foundations such as Rockefeller and Ford. There would be enough incentive for the private sector to participate when they consider the potential market that would be created-even if, for the next decade, their contributions in research to adapt technologies and bring down costs would not be profitable in strictly financial terms.
The pace has to be pushed. A cautious slow program would have dire implications, for the "knowledge econ- omy" is looming. The gap must be closed if there is to be any hope for those countries that are far behind now. Until there is a critical mass of educated people, developing countries will not be able to compete.
The requisite degree of change is systemic; it involves giant steps. The task is to lay the foundation for a future of national and planetary security. We may take to heart Albert Einstein's message in his autobiography, that "there is no time for petty bargaining. The situation calls for a courageous effort, for a radical change in our whole attitude and in the entire political concept."
Morris Miller is former senior economist and an Executive Director of the World Bank who is now consulting and teaching at the Univeristy of Ottawa and Tuft University's Fletcher School of Law & Diplomacy as a visiting professor. His home page is: http://www.gutenberg.com/~miller