Development Management of Transforming Economies

Fabiana Sciarelli • Azzurra Rinaldi

Development Management of

Transforming Economies

Theories, Approaches and Models for Overall Development

ISBN 978-1-137-59910-0 ISBN 978-1-137-59911-7 (eBook)DOI 10.1057/978-1-137-59911-7

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Fabiana SciarelliUnitelma Sapienza University of RomeRoma, Italy

Azzurra RinaldiUnitelma Sapienza University of RomeRoma, Italy

To my father,who taught me the difference between wrong and right, between greed and

sharing and between a simple professor and a true Master.

Fabiana Sciarelli

To my daughters

Azzurra Rinaldi

vii

Gandhi said: 'The world has enough for everyone's need, but not enough for everyone's greed.'

These words ultimately inspired our work.In 2015, according to the objectives of the United Nations, the world

would have to be free from poverty, universally educated and healthy. Instead, towards the end of 2016, the world is seeing not only the persis-tence of pockets of poverty that are actually increasing in some countries but also an unchanged life expectancy, due partly to infectious diseases that have not been eradicated. We are also seeing gender differences that are not yet filled, and also civil wars, hydrogen bombs, and the spread of international terrorism that has become increasingly aggressive.

How is it then, that after more than sixty years in which the world has been engaged in development, a system that allows the growth of human dignity is yet to be identified?

We are aware that there are transparent powers and opaque powers, transparent actors and obscure actors, clear and dark resources that fuel development, or so it seems, and we know that we cannot ignore it. But in this volume we want to present a common methodology useful for an enlightened government, which, perhaps tired of opaque powers, decides to work alongside transparent power, bringing its country into a real stage of Overall Development.

Preface

viii Preface

By Overall Development we mean a complex development composed in a balanced way in economic, health and educational terms, a develop-ment that lasts over time that does not sell off or destroy the country’s resources but uses them and preserves them; an independent develop-ment where public debt is not the key.

The economic theories on the subject of development have multiplied, as have the application of the social sciences, while the concept of its management has never really been pronounced.

To start a system of managed development of weak countries we can-not assume that in the path of such development its superiority to a systemic use of opaque powers will seem clear and possible, or obviously natural and right, so we will have to assess what it is that these dark sys-tems offer, and offer more.

Even the system of opaque powers, in fact, can be seen from a market perspective. No one would be able to buy the development of another were there not those willing to sell.

From a market perspective, we propose an alternative to welfare, an alternative to the new international colonialist system which is difficult to build and contains goals which are difficult to achieve. We propose instead the application of the use of easy tools, thereby rendering the proposed process possible.

Seeing developing cities suffocated by smog, or enmeshed in power lines, or hearing people call their country ‘the land of smiles’, when its smiles have been sold for a handful of money, or even knowing there are whole populations of children suffering at the hands of adults, that rights are not equal in all places, that equality of birth often has to be protected even more than that of gender, we honestly cannot accept that this can believed by anyone to be part of anything called development. Development, according to the etymology of the word, is the dissolution of a confused tangle of intricate, thread-like projections, not the creation of a new web of skeins, like the electrical cables that are to be seen rushing to the cities of the so-called developing countries.

Visiting these countries one has a sensation of estrangement, and feels not the euphoria of growth, but instead the concern not to be left behind.

Interviews that took place with some of the inhabitants of some of the countries we visited with reference to the people both national and

ix Preface

international that deal with development led us on the same path to the same overwhelming concerns: all those that involve the management of development.

With this book, bearing in mind always the outcome of the errors of the past, we intend not to give some unique solution that can be used indiscriminately for the development of all countries, but rather to create a system of tools and models that will allow an individual country to move towards a more autonomous, strategic and operative method of planning founded on its unique characteristics: the Overall Development Model.

Our work is divided into four parts: the first deals with providing an articulated definition of development, emphasizing both its particulari-ties and also the differences from mere growth. To this end, it proposes a synthesized reading of the most important theories, be they of growth or of development, to emphasize how development includes growth and also how the converse is not true.

In the same part, after offering an overview of the main developmen-tal indicators used and indices internationally developed, we deal more specifically with the question of the less-favoured areas, areas that are rep-resentative of how inbuilt factors that can prevent a development process within a particular country are likely to take over if they are not properly circumscribed and the obstacles they present not resolved with actions that need to be tailored to that specific country, and which cannot be of any standardized type.

The second part analyses primarily, instead, actors that are engaged in development, distinguishing between public, private and mixed. In this part we talk about private actors that are non-governmental ones, includ-ing in this group a series of private figures that can become strategic in the field.

In the third part, we study the strategic and operational plans of six countries, divided between Africa and Asia, namely: South Africa, Ethiopia and Benin; India, the Philippines and Myanmar.

We analyse, therefore, the main plans, and, studying the results of these, we make a comparison with other countries, then finally portray the country’s development.

With this portrayal begins the fourth part, dedicated to defining the Overall Development Model, which is the object of this book. What

x Preface

emerges from the analysis of government policies and of the structure of economic data is, in fact, the basis for the elaboration of a develop-ment model in which, for the first time, priority is defined internally and directly from within the country, from which, therefore, is derived the external methodology (of the same model), making possible an overview of the basic needs of the country.

One of the crucial points of the new model lies precisely in the promo-tion of autonomy (in assessment and decision) of the transforming areas, i.e., their progressive empowerment.

The first chapter of this fourth part (ch. 10) is related, in fact, to the contemporary structure of development.

From the eleventh chapter on, however, we give space instead to the definition of strategic planning in three phases, according to the lifecycle of the development, the instruments used, the model of strategic plan-ning and the management. The management model of development in transforming areas is then explained in detail in the final chapter.

xi

We consider it imperative to address our gratitude to all those who made scientific and professional contributions towards the realization of this book.

First, our heartfelt thanks go to the working group that, throughout, helped and supported the process of the writing and the revision work.

Great thanks go to our own University Unitelma Sapienza, especially to the dean, Professor Francesco Avallone, who both accompanied and encouraged us in our research, to our publishers, Palgrave Macmillan, and especially there Liz Barlow and Maddie Holder for having believed in this project and supported us while we were writing.

The book is enriched by the work of Valentina De Simone, who donated professional graphic elements for our text; of Francesca Brega with her valuable and ongoing contribution to our work; of Francesca Traclò in preparing the paragraphs on communications and participa-tion crucial to the discussion of the management of development; and to Joanna Loizos Joannou for a passionate and highly professional revision of the text. To all of them go our very special thanks.

We would also like to thank the UNDP, specifically Dr Giovanni Camilleri and Dr Ayodele Odusola, for helping us understand the diffi-cult functioning of international institutions; the UN, namely Dr Valeria Biagiotti, with whom we were able to clarify the structure and move within the complex functioning of the United Nations; and to all repre-

Acknowledgements

xii Acknowledgements

sentatives of special international agencies who, for various reasons and in various ways, helped us to understand.

We would like to express our gratitude to all the representatives of the international NGOs engaged in Asia and Africa who dedicated their valuable time to sharing information on their work and their difficulties.

Infinite thanks go also to the driving force of our work—the children, boys, girls, men and women we have had the privilege to know, interview and hopefully understand, and who showed us, solidly and clearly, what exists in the world and what shouldn’t anymore.

Finally, bearing complete responsibility for what is written in this book, we thank all those who now have the desire and the patience to read our work.

xiii

Part I Development 1

1 Defining Development 31 Economic Development 42 Social Development 93 A Balanced Development 114 Sustainable Development 125 Economic Globalization and Development 156 Development Ethics 177 Happiness and Development 19

2 Theories of Development 231 Classical Theories 242 Theories Based on Industrialization 263 Theories of Human Capital and Theories of Basic Needs 324 The Neoclassical Theories 355 Theories of Social Capital 366 Institutionalist Theories 377 The Theory of Capabilities 39Bibliography 40

Contents

xiv Contents

3 Development Indicators and International Rankings 411 Gross Domestic Product 412 GDP Growth Rate 433 Gross National Income 444 Gross National Income Per Capita 455 GNI Per Capita at Purchasing Power Parity 466 The GINI Coefficient 487 Life Expectancy at Birth 488 Human Development Index 509 Index of Economic Freedom 5610 Doing Business Index 5811 Social Progress Index 6212 World Happiness Report 71

4 Special Focus on the Transforming Economies 751 Definition of Less-Favoured Areas 752 Weakness and Marginality 773 The Weak Areas of the World: International

Ranking Analysis 88Bibliography 99

Part II Actors of Development 101

5 Public Actors 1031 Intergovernmental and Global Actors 105

1.1 The United Nations 1061.2 Specialized Agencies 1181.3 Global Development Sources 1201.4 World Bank 1241.5 Combined Intergovernmental Actors for

Development 1282 ‘Regional’ and Local Actors 128

2.1 ‘Regional’ Institution for Integration 1282.2 ‘Regional’ Development Bank 1332.3 Local Governments 136

Bibliography 138

xv Contents

6 Private Actors and Non-Governmental Actors (NGA) 1391 Third Sector 1402 Civil Society and Social Movement 1433 Non-Governmental Organizations (NGOs) 1464 Foundations 1525 Universities and Enterprises 154Bibliography 157

7 Mixed Actors 1591 Collective Actions 1592 Partnerships 1613 Mixed Actors 1634 Actors of Development 1655 Cases 167Bibliography 172

Part III Development Programmes in the World 175

8 Development Programmes in Africa 1791 Strategic Plans 179

1.1 South Africa: Programmes and Plans 1791.2 Ethiopia: Programmes and Plans 1861.3 Benin: Programmes and Plans 1911.4 Human Development Index Ratings in

Comparison 2002 Economic Strategies 203

2.1 Economic Strategies of South Africa 2032.2 Economic Strategies of Ethiopia 2052.3 Economic Strategies of Bénin 2072.4 Data and First Results 210

3 Health Strategies 2283.1 Health Strategies of South Africa 2283.2 Health Strategies of Ethiopia 2343.3 Health Strategies of Bénin 2363.4 Data and First Results 240

xvi Contents

4 Education Strategies 2494.1 Education Strategies of South Africa 2494.2 Education Strategies of Ethiopia 2544.3 Education Strategies of Bénin 2574.4 Data and First Results 260

Bibliography 267

9 Development Programmes in Asia 2691 Strategic Plans 269

1.1 India: Programmes and Plans 2691.2 Eleventh Plan (2007–12) 2721.3 The Twelfth Five Year Plan (2012–17) 2741.4 Philippines: Programmes and Plans 2811.5 Myanmar: Programmes and Plans 2861.6 HDI in Comparison 298

2 Economic Strategies 3012.1 Economic Strategies of India 3012.2 Economic Strategies of the Philippines 3042.3 Economic Strategies of Myanmar 3052.4 Data and First Results 306

3 Health Strategies 3203.1 Health Strategies of India 3203.2 Health Strategies of the Philippines 3253.3 Health Strategies of Myanmar 3293.4 Data and First Results 332

4 Education Strategies 3394.1 Education Strategies of India 3394.2 Education Strategies of the Philippines 3434.3 Education Strategies of Myanmar 3464.4 Data and First Results 349

Bibliography 353

xvii Contents

Part IV From Traditional Development Structure to the Optimal Structure 357

10 Traditional Structure of Development Programme 3591 Strategies 359

1.1 Strategic Analysis 3601.2 Vision, Mission and Objectives 3611.3 Development Strategy 362

2 Human Resource Management and Communication 3653 Budget and Control 376

11 Development in Three Phases: The Future of Transforming Areas 3791 Lifecycle of Development 3812 Development Strategy and Planning 387

2.1 Strategic Analysis 3912.2 Setting Goals 3952.3 Definition of Strategies 3962.4 Strategic and Operational Planning 4022.5 Implementation and Control 408

3 Startup Phase 4103.1 Strategic Planning 4113.2 Actors and Roles 4143.3 Operational Planning 4183.4 Human Resource Management 4193.5 Communication 4253.6 Budgeting and Control 428

4 Hang On Phase 4304.1 Strategic Planning 4314.2 Actors and Rules 4324.3 Operational Planning 4324.4 Human Resource Management 4334.5 Communication 4364.6 Budgeting and Control 437

xviii Contents

5 Self-Development Phase or Welfare Phase 4385.1 Strategic Planning 4385.2 Actors and Rules 4395.3 Operational Planning 4395.4 Human Resource Management 4405.5 Communication 4405.6 Budgeting and Control 441

Bibliography 444

12 Overall Development Model for Transforming Areas 4471 Overall Development Model 447Bibliography 452

Bibliography 453

Index 475

xix

Fig. 3.1 World GDP at current prices (US$). Source: Our elaboration of World Bank data 43

Fig. 3.2 GDP. Source: Our elaboration on World Bank data 44Fig. 3.3 Gross national income. Source: Our elaboration on

World Bank data 45Fig. 3.4 GNI per capita. Source: Our elaboration on World Bank data 46Fig. 3.5 GNI per capita at purchasing power parity (international $).

Source: Our elaboration on World Bank data 47Fig. 3.6 Life expectancy at birth. Source: Our elaboration on

World Bank data 49Fig. 3.7 Index of economic freedom map 2015. Source: The Heritage

Foundation 58Fig. 3.8 Social progress index map 2015. Source: Social Progress

Index 2015 67Fig. 3.9 World happiness map 2015. Source: World Happiness

Report 2015 72Fig. 3.10 World happiness ranking 2015. Source: World Happiness

Report 2015 73Fig. 4.1 GDP. Source: Our elaboration of World Bank data 77Fig. 4.2 GDP growth rate. Source: Our elaboration of World

Bank data 79Fig. 4.3 GDP per capita at PPP 2014. Source: Our elaboration of

World Bank data 80

List of Figures

xx List of Figures

Fig. 4.4 Agriculture value added as a share of GDP. Source: Our elaboration of World Bank data 81

Fig. 4.5 Industry value added as a share of GDP. Source: Our elaboration of World Bank data 82

Fig. 4.6 Services value added as a share of GDP. Source: Our elaboration of World Bank data 83

Fig. 4.7 Foreign direct investments (current US$). Source: Our elaboration of World Bank data 84

Fig. 4.8 Net ODA received (current US$). Source: Our elaboration of World Bank data 86

Fig. 4.9 Net ODA and official aid received. Source: Our elaboration of World Bank data 87

Fig. 4.10 Life expectancy at birth. Source: Our elaboration of World Bank data 88

Fig. 5.1 Development actors matrix 104Fig. 5.2 United Nations structure. Source: www.un.org 109Fig. 5.3 ECOSOC system. Source: www.un.org 110Fig. 5.4 Typology of regional integration initiatives 130Fig. 8.1 GDP (Current US$). Source: Our elaboration of World

Bank data 210Fig. 8.2 GDP growth rate. Source: Our elaboration of World

Bank data 211Fig. 8.3 Agriculture. Source: Our elaboration of World Bank data 213Fig. 8.4 Industry. Source: Our elaboration of World Bank data 216Fig. 8.5 Services. Source: Our elaboration of World Bank data 216Fig. 8.6 GNI per capita PPP (current). Source: Our elaboration of

World Bank data 218Fig. 8.7 Population. Source: Our elaboration of World Bank data 219Fig. 8.8 Exports (% GDP). Source: Our elaboration of World

Bank data 221Fig. 8.9 Imports. Source: Our elaboration of World Bank data 222Fig. 8.10 FDI inflows. Source: Our elaboration of World Bank data 223Fig. 8.11 Net ODA and official aid received. Source: Our elaboration

of World Bank data 225Fig. 8.12 Life expectancy. Source: Our elaboration of World

Bank data 226Fig. 9.1 GDP current. Source: Our elaboration of World Bank data 307Fig. 9.2 GDP growth rate. Source: Our elaboration of World

Bank data 308

xxi List of Figures

Fig. 9.3 Agriculture. Source: Our elaboration of World Bank data 309Fig. 9.4 Industry. Source: Our elaboration of World Bank data 310Fig. 9.5 Services. Source: Our elaboration of World Bank data 311Fig. 9.6 GNI per capita PPP (current international $).

Source: Our elaboration of World Bank data 313Fig. 9.7 Population. Source: Our elaboration of World Bank data 313Fig. 9.8 Exports (% GDP). Source: Our elaboration of World

Bank data 315Fig. 9.9 Imports. Source: Our elaboration of World Bank data 316Fig. 9.10 FDI inflows. Source: Our elaboration of World Bank data 317Fig. 9.11 Net ODA and official aid received. Source: Our elaboration

of World Bank data 318Fig. 9.12 Life expectancy. Source: Our elaboration of World

Bank data 320Fig. 10.1 Chinese boxes system of development 363Fig. 11.1 Development lifecycle 384Fig. 11.2 Strategic programming 391Fig. 11.3 Sectors in comparison 397Fig. 11.4 Partnership matrix 400Fig. 11.5 WBS of a development project 405Fig. 11.6 Gantt diagram of operative actions in a sector plan 406Fig. 11.7 Responsibility matrix 407Fig. 11.8 Adaptation strategy 409Fig. 11.9 HRM in startup phase 424Fig. 11.10 HRM of hang on phase 435Fig. 12.1 Overall Development Model chart 450

xxiii

Table 3.1 Very high human development countries 52Table 3.2 High human development countries 53Table 3.3 Medium human development countries 54Table 3.4 Low human development countries 55Table 3.5 Index of economic freedom ranking 2015 59Table 3.6. Doing Business ranking 2015 63Table 3.7 Social progress index ranking 2015 68Table 4.1 Ranking based on GDP 2014 in US$ 90Table 4.2 GDP growth rate 2014 ranking (%) 91Table 4.3 GDP per capita 2014 ranking in US$ 93Table 4.4 FDI 2014 ranking (current US$) 95Table 4.5 Net ODA and official aid received 2013 (current US$) 97Table 4.6 Life expectancy at birth 2013 (years) 98Table 5.1 Overview of the regional development banks 134Table 5.2 Top stakeholders of the regional development banks 135Table 7.1 Global Partnership for Education 168Table 7.2 GAVI, the Vaccine Alliance 168Table 7.3 The Consultative Group to Assist the Poor (CGAP) 170Table 7.4 Global Public–Private Partnership (GPPP) for

Handwashing 171Table 8.1 Growth targets and performance under PASDEP

(% of real GDP) 189Table 8.2 Human Development Index rankings 200

List of Tables

xxiv List of Tables

Table 8.3 Human Development Index 2014 202Table 8.4 HDI trends 203Table 8.5 Life expectancy at birth, total (years) 241Table 8.6 Maternal mortality ratio (MMR) (deaths per 1000 births) 242Table 8.7 Mortality rate of children under five (U5MR)

(deaths per 1000) 242Table 8.8 Neonatal mortality rate (NMR) (deaths per 1000 live births) 242Table 8.9 Immunization for diphtheria/pertussis/tetanus (DPT)

(% of children aged 12–23 months) 244Table 8.10 Prevalence of HIV, total (% of population aged 15–49) 244Table 8.11 Consolidated government expenditure by function,

2014/15–2017/18 245Table 8.12 Number of health facilities in Ethiopia 246Table 8.13 Health expenditure per capita (current US$) 247Table 8.14 Health expenditure (total health expenditure, % GDP) 247Table 8.15 Health expenditure, public (% GDP) 247Table 8.16 Health Indicators 2014 249Table 8.17 Youth (15–24 years) literacy rate (%) 261Table 8.18 Primary school participation—net attendance ratio (%) 262Table 8.19 Secondary school participation—net attendance ratio (%) 262Table 8.20 Fixed phones (landlines) (per 100) 264Table 8.21 Mobile phones (per 100) 264Table 8.22 Internet users (per 100) 264Table 8.23 Government expenditure on education (% GDP) 265Table 8.24 Government expenditure on education

(% of total expenditure) 266Table 8.25 Government expenditure per student, primary

(% GDP per capita) 266Table 9.1 Five Year Planning in India 271Table 9.2 Myanmar’s key medium-term development targets

2011–12 to 2015–16 295Table 9.3 HDI in comparison 300Table 9.4 HDI trends 301Table 9.5 Majors reforms in the health sector in Myanmar,

1988–2012 330Table 9.6 Life expectancy at birth, total (years) 333Table 9.7 Maternal mortality rate (modelled estimate, per 100,000

live births) 333

xxv List of Tables

Table 9.8 Mortality rate under 5 (U5MR) (per 100,000 children) 334Table 9.9 Mortality rate, neonatal (per 100,000 live births) 335Table 9.10 Immunization, DPT (% of children ages 12–23 months) 335Table 9.11 Health expenditure per capita (current US$) 336Table 9.12 Public health expenditure (% GDP) 337Table 9.13 Health indicators 2014 339Table 9.14 Youth (15–24 years) literacy rate (%) 349Table 9.15 Primary school participation—net attendance 350Table 9.16 Secondary school participation—net attendance 350Table 9.17 Mobile phones per 100 351Table 9.18 Internet users per 100 351Table 9.19 Government expenditure on education (% GDP) 352Table 9.20 Government expenditure per student,

primary (% GDP per capita) 352Table 9.21 Government expenditure on education (% of total

expenditure) 352Table 10.1 Plans analysed 366Table 11.1 Development lifecycle phases 442