SOUTH-SOUTH NEWS, New York: World Bank Leader Calls for Smart Risks to End Poverty, but Financing

Questions Remain By Brendan Pastor It has been described as the moral issue of our time. To eliminate extreme poverty for the over one billion people living on less than $1.25 per day, the World Bank has undertaken an ambitious agenda of goals and targets to lift the neediest people out of poverty and boost shared prosperity in the developing world. Addressing an audience at George Washington University this week, Jim Yong Kim, President of the World Bank, said, The goal of ending extreme poverty stands on its own as the moral underpinning of all that we do. The fact that more than a billion people live on less than $1.25 a day in 2013 is a stain on our moral conscience. We must help lift people out of poverty without delay, without prejudice, no matter the circumstance, no matter the locale. To achieve the ambitious results set out in the Banks recent development strategy, Kim argued that new ways of thinking were needed. We will take risks smart risks. And by that, I mean we will invest in projects that can help transform the development of a country or a region even if it means we might fail. Kim then outlined specific financial arrangements that would take place in order to facilitate easier financing of the Banks development agenda. This included his primary target of partnering with the private sector to use their expertise and capital to fight poverty. The World Banks view on ending poverty mirrors the United Nations approach, particularly the necessary inclusion of the private sector in financing the goals due to declining overseas development assistance (ODA). Indeed, following the recent financial crisis, ODA has declined by nearly 5%, contributing to broad structural imbalances in developing world economies. The UNs post-2015 development agenda is meant to build on the success of the Millennium Development Goals, has been hailed by experts within the global development environment as the most ambitious anti-poverty agenda in history. It also takes considerable steps to keep environmental concerns at the core, with an explicit view of tying poverty goals to sustainable development objectives. Indeed, both the World Bank and the UN share the view that the time for complete eradication of extreme poverty, and a concurrent global push to alleviate environmental concerns, is at hand.

Assistant Secretary-General and special advisor to the Secretary-General on post2015 goals Amina Mohammed elaborated this point last month after the 68 th General Assembly. The approach is conceptually not new, since 1972, but I think its time has come. To eradicate poverty, you need to use an integrated approach of the environment with an inclusive and social agenda, and certainly an economic agenda. They have to come together somehow, Mohammed told South-South News. But in both institutions cases, questions about the efficacy of full involvement by the private sector have created doubt in the minds of many civil society activists who harbor skeptical views of private finance and its end-goal in development projects. During a discussion on the work of the Intergovernmental Committee of Experts on Sustainable Development Financing at the UN this week, civil society leaders and even some member states expressed concern at the organizations insistence on private sector involvement. Barbara Adams, a senior policy adviser at Global Policy Forum, suggested the UN was putting all its eggs in one basket, referencing its reliance on the promises of private sector leaders to fund the sustainable development goals still to be decided. Im pleased to see there is an approach [by the UN] to looking at the private sector with the idea of checks and balances in mind, and from the good governance approach, Adams told the panel. Skepticism was further elucidated by a representative from the Singapore mission to the UN, who stated in no modest way that the private sector does not share the moral obligations or ethical interests of civil society NGOs or UN officials. The private sector is only interested in maximizing profit, Mark Neo, the Deputy Permanent Representative of Singapore to the UN, said, noting that the UN should be aware that there may be unintended consequences of putting too much reliance on the private sector. Perhaps it is better to lift up the rock, have a look at whats underneath, then put the rock back down if we dont like what we see, Neo added. Either way, both the World Bank and the United Nations put heavy emphasis on the continue inclusion of private finance and public-private partnerships to fund development projects. With declining ODA official development assistance from tightening national pockets due to domestic and international pressures, the role of the private sector is key to filling in the funding gaps.