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From Vailala on Downer’s unfortunate Pacific legacy
Thank you Stephen for an interesting blog-post. I think that there is much to be commended in what you say here.
The idea of ‘good governance’ in the context of aid and development has always been somewhat unanchored, lacking a measure of its applicatory relevance. Broadly speaking the institutional focus of the ‘good governance’ concept has been based on an identification of the institutions which are assumed to be supportive of the Pareto-efficient allocation of resources as found in the advanced economies, especially that of the USA. One example of this line of thought in the development context is this World Bank paper discussing the minimal role of labor market contracting among African farmers. The authors assume that because the idealised (market-driven hire and fire) model is not realised in African family-based subsistence farming practice the developmental remedy to the situation is ‘institutional strengthening’ of a ‘good governance’ character - that the institutional and legal framework of labor contract law be improved, thereby bringing actual practices into better alignment with the idealised economic model.
You are correct when you describe the Chinese approach to infrastructure development and aid as pragmatic. To understand Chinese pragmatism I think it useful to examine Chinese analysis of the China transformation and the extent to which Chinese analysts see relevance in the China experience to the development issues and problems of low-income countries. In addition to the writings of Wen Tiejun and his associates the analysis of Yi Wen is instructive. Yi Wen proposes a multi-stage model of development with interesting features, including non-linearity. Among the topics Yi Wen discusses is the role of corruption and political patron-clientelism during the early stages of the economic and political transformation process. Yi Wen makes the important point that the elimination of corruption can only be a late development stage issue (as in the UK and USA) because comprehensive political/legal control of corruption carries a very high transaction cost that an early stage developing state simply cannot afford. The implication that ‘corruption’ and ‘clientelism’ is a necessary feature of early development stages is left open.
To a considerable extent Yi Wen’s discussion of China’s development mirrors the discussion that took place in the late soviet period among Russian economists. This discussion concerned the ‘system-forming character of capitalism’ in the economies of Taiwan, Korea, Vietnam, Lao and Japan (see N.A. Simoniya and V. Sheinis). The discussion focused on the diverse ‘multistructurality’ characteristic of low-income countries.
That there isn’t a single path, runway and take off to development is also underscored by the Korean economist Keun Lee. Here is a topology-based path analysis that can be contrasted with the standard linear regression analysis found in neoclassical economics.
China’s BRI (and the AIIB) will enable the Pacific Island countries to achieve at least some of their development goals, as they choose to conceptualise them and in accordance with their political and fiscal capabilities and capacities.
Vailala
From Alurigo Ravusiro on The time is right for a ‘step-up’ in ABC broadcasting to the Pacific
Let's keep ABC alive as it has been a foreign policy information platform whilst also airing its own take on foreign policy subtleties.
From Alurigo Ravusiro on Australia’s relationships with its Pacific Island neighbours should not be about China
I agree. We are in the Pacific but what good is our commenting when bigger viewpoints are bound by traditional sentiments and alliances.
From JK Domyal on Downer’s unfortunate Pacific legacy
Thanks Stephen for this retrospective account of Downerist paradigm in the Pacific back then.
As we move into the modern world with increased innovations in all aspects of our lives, we do so within the landscape of foreign relations. What used to be the thinking around Pacific nations as the last frontier is now a geopolitical power-playing field.
During Downer’s reign, Pacific island nations were not that significant, and simple jobs like fruit picking in Australia was given to other well affluent countries. Australian aid to the Pacific nations was through a “boomerang” model. Now things have changed and former policy thinkers like Downer have moved on; a new breed of leaders has emerged not only in Australia but in Pacific nations as well. The new generation would see the boomerang model as obsolete and court new aid givers. One obvious development is the attraction of Chinese soft loans into the Pacific.
This would also mean re-shaping Pacific foreign policy from Canberra. One obvious approach would be to increase and give opportunity for the Pacific nations to participate in the Australia seasonal labour scheme. However, China's soft carrot approach is not for Pacific islanders to work in Chinese rice fields but it still attracts the Pacific nations. Canberra's thinking about Pacific nations needs a better and smarter approach.
The critique on improving governance systems to address corruption in Pacific nations is a relevant investment with Australian aid. However, much of it has not succeeded, as there are inherent ideological misfits that would not change quickly but it is what gives a unique identity to the islanders. The Pacific nations will remain a fragile and vulnerable political and economic zone in the Asia Pacific region while the geopolitical competition between capitalism and liberalism players increases in the future.
From Bronwen on Remittances and migration: the case of Nepal
You are right. I would certainly agree that labour migration without protections can have a dark side and remittances are not a sustainable source of income. However they are a lifeline for many families that would otherwise have to wait years for employment opportunities within Nepal to improve. In the meantime the benefits of remittances need to be maximised for those whose livelihoods depend on it.
From Uday S Prasad on Remittances and migration: the case of Nepal
Veru interesting insights! We see Nepalese migrants in all cities and in our neighbourhoods for many years. It's possible that toursim in Nepal and remittances from the workers overseas has contributed to increasing HDI. However, much needs to be done. Incomes can be increased substantially with improving agriculture and allied sectors.
From Pratheeban on Remittances and migration: the case of Nepal
Very insightful. The context is quite similar to Sri Lanka.
From Rajesh Sharma on Remittances and migration: the case of Nepal
Thank you for this detailed article. Very helpful.
But there is a negative side to it:
1) Remittances are an unsustainable source of income; it depends on external factors and on the mercy of the host country.
2) The social costs of migration are not covered in this article, in particular, women - both returned or left behind - are suffering.
3) Most horribly, at least 2 Nepalis die every day in foreign countries, they are underpaid and heavily exploited - it's a new form of slavery (see https://www.theguardian.com/world/2014/dec/23/qatar-nepal-workers-world-cup-2022-death-toll-doha).
From Richard Bedford on A Pacific step down
Excellent series of blog entries on changes to the WHS in Australia, Stephen. The recent policy changes certainly seem to be a backward step for a visa category that is designed to promote cultural exchanges and short-term periods of casual employment to assist with expenses of the holiday. Australia's WHS visa needs to be seen as a temporary work visa for relatively unskilled work.
It will be interesting to see if labour hire companies currently recruiting Pacific workers under the SWP shift to the WHS. You did a great job in one of the blog piences in showing the incentives they (and employers) will have to making these changes.
We will be watching developments from the other side of the Tasman with interest.
From Stephen Howes on Australian aid to PNG
Hi Michael,
I want to come to Stephanie's defence here. Of course there is massive corruption in PNG, and of course that is a huge problem. But what can the aid program do about it? Very little. Even if Australia was more outspoken about the problem, it would have very little effect. And, as much as we'd like it, Australia is not going to be outspoken, not when China is heaping praise on O'Neill and his government.
So then what to do? Of course the OSF model has its own limitations. But it also has some very positive features. It works with government, but in a hands-on way. It is focused on results and monitors progress towards them. It tries to get things done rather than amorphously advise and build capacity. These are approaches that other donors could more fully adopt, including the Australian aid program. They are approaches that won't solve the problem of widespread corruption, but make it more likely that aid will succeed in a difficult operating environment.
Regards,
Stephen
From Vailala on Downer’s unfortunate Pacific legacy