The paradox of development in the Global South.

Africa and other countries in the Global South are at the age of cynicism towards development. The International development system is anarchic, and states seek self-survival and advancement of self-interests. According to Aristotle, man is a social animal; from time immemorial, humankind has always been organized in communities based on family, tribe, religion, or national identities. Therefore, what puts the democracy and development debate at the center stage is a result of different ideological systems in global socio-economic and political governance perpetuating complex intersections between poverty, inequality, and power in the international development system. In the laws of nature, if no power is erected or not significant enough for security, every man will and may rely on his strength and art to caution against all other men. The state is the product of a man; thus, if the man´s state of nature is selfish, brutish, and nasty, then the state and its institutions of governance are always at risk of manipulation by political actors.

Development in the Global South has been, for decades, a prescribed recipe by the Washington Consensus. By the Washington Consensus, I mean the oversimplified rendition of policies recommended by international financial institutions and the US Treasury, especially during the eighties and early nineties, before they became a subject of vilification in the South. In the minds of most people around the world, it has come to refer to development strategies that focus on privatization, liberalization, and macro-stability, meaning mainly price stability. The policies are often referred to as ‘neo-liberal’ because of the emphasis on liberalization and because, like nineteenth-century liberalism, they emphasized the importance of a minimal role for the State. In our generation, neoliberal power and market-dominated society have become a practical reality for much of the world’s population. 

The policy agendas that combine tax cuts, deregulation, privatization, trade liberalization, insecure labor, and the squeezing of welfare, education, and health spending have gained immense influence since the 1970s. Adopted by social-democratic and conservative parties across the globe, these agendas have survived several decades of critique, crisis, and resistance. The neoliberal doctrine that sprang from a group of right-wing economists in Europe and the United States in the 1940s, 50s, and 60s, notably Friedrich Hayek and Milton Friedman, caused the global change in national policy frameworks. This group rejected Keynesian economics and the welfare state, seeing state economic intervention as “the road to serfdom,” and argued for free markets as the basis of decision-making in every sphere. 

Gradually the narrative spread via the Mont Pelerin Society, the Chicago School of Economics, and corporate-funded foundations in the USA; their ideas moved from margin to center when picked up by Thatcher and Reagan as a new agenda for populist right-wing politics, and by Volker, at the US Federal Reserve, as a guide to economic policy. Thatcher led the attack on the bloated welfare state, and Reagan the attack on progressive taxation. The model was then rolled out globally via the IMF and World Bank through structural adjustment programs (SAPs) and the Washington Consensus on global economic policy leading to financial crises in the global south.

Development through neoliberalism was based upon personal profit-at-any-cost (industrial and business corporations are persons) from capital and energy-intensive industrialization. Through economic reform, governments maintain the interests of the ultra-rich, who gradually take over public assets by restricting governance to creating and defending markets and protecting private property. Neoliberal economic growth promotes global trade, consumerism, and debt in the global south. It thus subordinates democracy, equity, social justice, and freedom and wreaks economic violence upon the majority poor. The effects of neoliberal policies are witnessed through debt crises, severe environmental degradation and crashing economies, currency collapse, rising unemployment, rising food and fuel prices, and falling wages. The social illeffects were exacerbated by the implementation of austerity measures of cutting subsidies for the poor and reducing public spending on health, welfare, and education. Worldwide, spontaneous people’s grassroots movements opposed the displacement of populations due to mega projects and environmental degradation.

Political economy scholars see the concept of democratization as a process of institutionalizing the major democratic principles as part of everyday socio-cultural activities in a given society. Historically, democratization seemed a delicate and unattainable process in Africa, Latin America, and Asia. But this attitude took a drastic turn in the early 1990s when the wind of democratization powered by the development of capitalism swept through Africa and Asia, among other continents, to bring and, or stimulate greater optimism. Neoliberal policies gained prominence during the late 1970s as a strategic political response to the declining profitability of mass production industries and the crises of Keynesian welfare and as an advancement to the democratization agenda by the global north. Furthermore, following the debt crisis of the early 1980s, neoliberal restructuring programs were extended selectively across the global South through the efforts of US-influenced multilateral agencies to subject peripheral and semi-peripheral states to the discipline of capital markets. 

The Democracy Advantage: How Democracy Promotes Prosperity and Peace” has already noted that the appeal of the authoritarian-led approach has at least something to do with its expediency, compared to the time-consuming messy procedures typical of the democratic process. The point being made here is that national development requires a centralized, solid, and highly autonomous government, especially when the developing countries need to accelerate the development process to meet up with developed nations, and that politics of democratization are too messy and unpredictable to provide such environment and political structure. Again, in authoritarian regimes, state actors usually enjoy a much longer time horizon and do not need to worry about the short-term politicking that typically arises from the electoral process and distorts the national development plan.

In terms of national development, l argues that there is no one-size-fits-all approach, which is why the bloated Washington Consensus policies failed in the global south. To bridge the gap between neoliberal policies in the current global order and national development, there is a need to look at a raft of international forces. The global trend towards devolution, decentralization, and globalization has entrusted local and regional development actors with the power to formulate and implement policies and strategies to improve the well-being of local citizens. The devolution and decentralization trend opened the window for place-based approaches to development through innovation by the local people. These place-based approaches are spatially sensitive and can reduce persistent inefficiencies and inequalities by tailoring public goods and services to the particularities of local and regional contexts. Thus, the main idea of the indigenous approaches is to solve inequalities between different local and regional spaces due to power disparities and the impact of globalization. The place-based approach seeks to ensure that the local people can shoulder their responsibilities and develop within their territories innovations and interventions. 

Suppose democracy is a system of government by the whole population or eligible state members, typically through elected representatives. Then we can not shoulder global policy frameworks but home-grown, place-based approaches that ensure the participation of local decision-makers in the formulation, implementation, monitoring, and evaluation of developmental projects. The indigenous approaches to local and regional development become a central strategy because they enhance innovation and collaboration. These place-based approaches seek to promote growth from below. Development from below entails a system of devolution and participation of local stakeholders in decision-making, ensuring innovation and a knowledge economy. The innovation system approach argues that innovation is the key to competitiveness in a knowledge economy. It moves away from a linear model and recognizes that innovation typically results from complex, interactive, and cumulative knowledge and learning processes in which various actors participate.  Henceforth, place-based approaches are based on expertise, networks, understanding, and creativity of the local people and the existing knowledge, policies, and experiences. Creativity is enhanced through learning and knowledge, which is central to the development of regions and locales due to the capabilities of actors’ willingness to learn. Creativity can improve innovation into entrepreneurship, stimulating local and regional growth.

Coordination and cooperation between regions and localities within the state are critical in strengthening indigenous approaches to local and regional development. The other essential element is capacity building and a people-based system, which help to ensure that localities or regions transform empowerment, innovation, and entrepreneurship into economic growth and increase people's living standards. Multilevel governance structures and territorial networks constitute the means to promote the dialogue and interactions between parties at the heart of cross-territorial coordination and, ultimately, more efficient devolutionary processes. While there are limitations of the place-based approach are being revealed by sectoral rather than territorial approaches, top-down rather than bottom-up or mixed approaches, tendencies to focus on extensive infrastructure or industrial projects, under-emphasis on human capital and innovation, and the focus on financial support, incentives, and subsidies as critical policies and instruments of the strategy of national development.