Archives

Thought-provoker from the World Bank

The World Bank position announced recently that it just would not do to "leave-everything-to-the-private-sector" in developing countries, should be considered a timely eye-opener by particularly Third World governments and policy-makers. What makes this news doubly welcome is the frequent association of both the World Bank and the IMF with failed development strategies in developing countries which evolved around the advocacy of increased privatization and the relentless wittling down of welfarism and the public sector.

Given this backdrop, the position set out in the 'World Development Report 2004 - Making services work for the poor', that it would be wrong to conclude that privatisation is the only means to "ensure the provision of improved healthcare, education and other services to the poor people", comes as a notable change from the thinking popularly associated with the WB-IMF combine. For very many in the Third World, including some politicians, Think Tanks and academics, "structural adjustment" facilities extended by these twin institutions over the decades, have meant only one thing - increased hardships for the poor.

The gradual shrinking of the State sector in developing countries and the corresponding rise of the private sector has almost routinely been put down to WB-IMF thinking and advice. The recent WB position that privatization can no longer be considered a panacea for all our ills, however, should set the developing countries thinking.

We hope our decision-makers, policy-planners and the local development community have taken a long, scrutinizing glance at this ground - breaking statement. We believe that successive governments have been easily caving - in to simplistic thinking on these issues. The private sector - it goes without saying - has a principal role to play in a country's development effort but it would be fallacious to presume that the interests of the private sector would easily correspond with the public interest. The private sector is vastly instrumental in energising a country's productive sectors and in generating employment but it is private profit which, essentially, keeps the private sector humming.

The profit motive and public service, which is the function of the State sector, are usually at variance. How could a State, then, "leave-everything-to-the-private sector"? This is the most prime of issues, in this context.

In the case of Sri Lanka, the scaling-down of the public sector began in 1977, with the wide propagation of the "open economy" doctrine. However, there has been no corresponding decline in the country's poor. The number of Samurdhi beneficiaries in this country would give us a measure of those who are continuing to live on the social margins. The country's per capita G.N.P, as is well known, is no accurate pointer to how well the country is performing in an economic sense. If our development strategy, with its emphasis on the private sector, has worked so far, there would be equitable prosperity, which is clearly not the case.

Whereas the inefficiencies and excesses of centralised planning have to be eschewed and the private sector encouraged to participate vibrantly in the production process, the State should guard against abdicating its role as a service provider to the less privileged.

This position is further underscored rather than negated by the present rash of strikes in the public sector including health and transport. The Government needs to consider how these systems could be revived and energised from within. This is the challenge.

www.crescat.com

News | Business | Features | Editorial | Security
Politics | World | Letters | Sports | Obituaries

Produced by Lake House
Copyright © 2003 The Associated Newspapers of Ceylon Ltd.
Comments and suggestions to :Web Manager