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Interview with Yusuf Bangura: UNRISD's Poverty Report in Sierra Leone

15 Mar 2011

5 January 2011—Interview by Sierra Leone’s CTN Radio with UNRISD Research Coordinator Yusuf Bangura regarding UNRISD’s flagship report Combating Poverty and Inequality: Structural Change, Social Policy and Politics

Listen to the interview here

Yusuf Bangura: The report is about combating poverty and inequality. It’s divided into three basic areas: trying to look at ways in which countries can generate policies and build institutions that can make a country move on a trajectory of growth which will also be able to generate sufficient employment so that people can come out of poverty. We believe that employment is very central to poverty reduction. With employment people can buy education, pay for health services, and subscribe to social insurance schemes like all the other middle class individuals do. So employment is very important. If you get your economic trajectory right you have made a tremendous impact. The second issue in the report is the significance of social policy. And it’s social policy not only from the view of social protection, which is the traditional way which international agencies have tended to treat social policy. We believe that social policy should also have a developmental orientation. In other words, it should be transformative. It should contribute to the empowerment of individuals, to improving the productive capacities of individuals and communities. It should also help to reduce the care burden of women. The word that we use to explain that kind of approach is transformative social policy. The third part of the report is politics. We think that you need a certain type of politics to drive your economic program and to drive your social policy program. And we try to show different types of politics that are conducive to effective poverty reduction.

CTN: Now we’re talking about policies here. For a country like Sierra Leone we have had several policies. But many people say that these policies have not been put into implementation, for which reason we have not made any significant strides in combating poverty.

Yusuf Bangura: Implementation is very important. A country which has policies but cannot implement them cannot be described as having policies. The countries which have been fairly successful in moving their countries forward, in transforming their economies, and lifting people out of poverty, have been able to implement their policies. Enforcement is very important. You have to create incentives for people to behave properly, but you also have to hold them to account. If they don’t deliver on the targets that you set you should be able to enforce the rules to insure that the policies get implemented

CTN: So therefore the question will stand: is policy formulation a problem or policy implementation?

Yusuf Bangura: Well, in the report we think it’s not just implementation. You also have to have the right policies. And you should not see policies in an isolated way. What we try to emphasize in the report is you should see them in a complementary way. One set of policies in the economic field, for instance, make up for the shortfalls in the social policy field. Similarly, social policies should also make up for shortfalls in the economic policy field. And you should have the right coalition of forces, the politics to be able to sustain development in the economic field and social policy field.

CTN: And this book is also about poverty reduction or inequality and you stressed—

Yusuf Bangura: It’s about both. It’s about poverty and inequality because we believe that poverty and inequality are two sides of the same problem. In fact, what we find is that poor countries tend to be more unequal than rich countries.

CTN: And then we see unemployment, especially in Sierra Leone, to be very high

Yusuf Bangura: If you look at unemployment defined the way in which the ILO defines it, unemployment is very low here. What you have is underemployment, lots of people trapped in the informal sector, selling goods that do not really have value, or much value. You can see a lady with a tray of cigarettes which counts up to maybe 5,000 dollars. That’s disguised unemployment. That’s underemployment—that’s what it’s called in the literature. If you want to see unemployment in its true sense, in South Africa, which I mentioned in the talk, the unemployment rate there is 40 percent and that’s precisely because the informal sector is not very large. But in West Africa and East Africa, informality is very high. Lot’s of people are not in the formal sector. In fact, the majority of the people are not in the formal sector.

CTN: So then which one is advantageous?

Yusuf Bangura: None of them is advantageous because both have problems. They both breed inequalities and they both breed poverty. But then in the Sierra Leone case or in the West African case, people cannot afford to be unemployed. That’s why they want to do one thing or the other, either selling a few things or doing certain services. Even though the profit ratio is very low, at least they believe that they can get something out of it. But a country cannot rely on that low level of informality to move its economy to a high level where it can begin to address the problems of poverty. From the informal sector it’s very large. Parts of it can generate real value and people can actually use it to move out of poverty. But there is another part of it, the lower end of it, where incomes are very low because lots of people trapped in that sector are doing similar things, and the scope for productivity and improvement is very limited there.

CTN: Looking at Africa or the world at large, there was what we used to know as the Poverty Reduction Strategy Paper [PRSP], which countries have to follow including Sierra Leone. But today we really have this Agenda for Change [Rio Declaration on Environment and Development]. And a new report has been made by the UN, which you champion. How do we look at your book, or the ideas or ideals of your book into these two policies, the Poverty Reduction Strategy Paper and the Agenda for Change?

Yusuf Bangura: I think the Agenda for Change, just looking at it from distance, and the kind of issues I see and read, it’s different from PRSPs. The PRSPs are mainly about stabilization, trying to set targets for inflation, reduction, and in some way also govern reasonable public sector, which is very small, and liberalizing the economy and privatising. The Agenda for Change, I think, is a step higher than that. I see in that agenda a concern for infrastructure development, a concern for health provisioning and education, especially health, where lactating mothers in pregnancy and children under five are to enjoy free medical care. I also see a concern for energy generation and distribution, which will be offered on a national scale, and I also see a concern for agriculture being used as an engine of growth, trying to raise productivity in the agricultural sector. I didn’t see these things in many of the PRSPs I’ve looked at, where the main concern was about growth and stabilization. Of course, once you set targets of inflation very, very low, this will stifle growth. And the concern for employment is not very central to many of the PRSPs I’ve seen because of this fixation on prize stabilization and getting the fundamentals right and then everything else follows on that. If you want to develop and have growth strategy that’s employment-generating and that also lifts people out of poverty, the state has to be actively involved in the way in which the markets are structured and the way markets deliver goods and services.

CTN: Again, looking at poverty in Africa, many people may say it is the type of political system, be it democracy, be it capitalism or so forth. But then, looking at your presentation, you spoke about Taiwan, you spoke about China, Korea, the improvement these people or these countries are making. These people are not implementing what we call this liberal democracy. In Africa or Sierra Leone, we are talking about strict democracy, but yet they’re at the bottom of the Human Development Index.

Yusuf Bangura: Well, you can say that development of Korea, Taiwan and those East Asian countries occurred basically under authoritarian conditions, but now they are democratizing and it’s through democratization that they’ve been able to expand social provisioning. Now, there is this argument about political systems and poverty reduction or development. The issue is that the debate usually focuses on these ‘growth miracles’, the Taiwans, Koreas etc. They forget that a lot of authoritarian governments are backward, they are anti-developmental, they are retrogressive. The majority of countries that are authoritarian are not developmental. In fact, from the African point of view, our own experience of the authoritarian regime is that of underdevelopment. That is why most of the African countries today are on the trajectory of democratization. Because when you look at what authoritarianism did to Africa, you will see that it has stifled debate, it stifled development, it has repressed people and made people poorer. So I’m not surprised that Africans now want to be democratic. Again, if you look at the African case, the bright spots, the countries that always lead when you look at the rankings, it’s the countries that are democratic: Mauritius, Seychelles, Cape Verde – these are democratic countries. Mauritius is the oldest democratic country in Africa—any table you look at on social development, it’s right at the top. In the Africa case, democracy does yield positive dividends in terms of development and in terms of social welfare.

CTN: Looking at your book now, how can Sierra Leone benefit or domesticate some of the recommendations or some of the projections posited?

Yusuf Bangura: People have to read it and engage in a process of reflection. I don’t think an institute or a report will have blueprints. There are no blueprints to development. You can analyze situations, you can look at constraints, you can look at possibilities, and you can show what some countries have done, how they’ve done it and why they succeeded. Now it’s left to governments and citizens to draw lessons from all these experiences and then try to see how they can improve on what they’re doing. It’s not the case that because a report comes out, all the truth is in it and everything that country X is doing is wrong. It may be doing certain things which are correct, or maybe all the things are not well thought-out or well implemented and it can draw lessons from what the report highlights to try to improve on those areas.

CTN: But South Africa is having 40 percent unemployment rate and now they are introducing this welfare system. Can Sierra Leone think about that? Is our economy so strong to think about creating welfare systems for people that are unemployed?

Yusuf Bangura: That’s a big question. South Africa does it, they have more fiscal space—it’s a big economy that can tax people and generate revenue to be able to sustain the kind of welfare program that they’re trying to sustain there. Sierra Leone has limited fiscal space, but even in that context, it’s possible if you improve on tax collection. And it’s not just GST [Goods and Services Tax] – GST is one of the elements. This country is rich in mineral resources: if we improve our revenue intake from that sector that is also going to contribute. If we were to expand productive capacities in agriculture, for instance, like the Agenda for Change is trying to do, and then fisheries, there is a lot of potential to try to get the economy on a path which will then make it possible for resources to be generated that can sustain a successful welfare programme. But even with those constraints, we see that countries are ready, if they are determined to help their population, there are certain basic things that you can do which are not that expensive. I’m not saying you should do everything that South Africa does or what Sweden does; you can select one or two things. If you take a health programme that targets lactating mothers, children and pregnant women, that’s one area where you can actually do things and get results. You can also think of other ways in which you can help the unemployed in terms of ensuring that you generate productive capacities in agriculture, you ensure that your road infrastructure projects are of the type that can actually utilize labour. Many of these infrastructure projects globally, especially in poor countries, are highly dependent on foreign technologies and do not employ sufficient labour. Usually, when you have big infrastructure projects like this, they should be able to generate demand for labour. So those are some of the things you can do if you get your production trajectory right and identify some basic level of protection that you think is vital for everybody. But if your production strategy is wrong, just putting your country on the welfare trajectory will be a disaster. I think the two have to go together.

CTN: You have launched this book on combating poverty and inequality. What would be your message to all Sierra Leoneans as regards to our effort in poverty alleviation?

Yusuf Bangura: For citizens, the way in which they can get out of poverty, especially the poor and those who are struggling, is if they are organized and they try to bring pressure to bear, not destructive pressure, but constructive pressure to bear on policy-makers. Countries that have been successful have had a very good relationship between government and political parties and citizens around welfare issues, around growth issues, around employment issues so that people understand the kinds of policies that governments are implementing and what is expected of them, and the kinds of demands they will also be making on governments and political parties. If political parties do not have a welfare orientation or a redistributive orientation or a developmental orientation it will be very difficult for citizens to impact positively on those authorities.

CTN: Well you have to pity Sierra Leone, especially when we are stressing party politics are not national issues, or issues that may bear on nationalistic principles.

Yusuf Bangura: No, party politics is important, but make the parties developmental. Let them be concerned about development, let them be concerned about redistributive issues, let them be concerned about networking with people, not just having a party that’s functional only when there are elections. A party that is developmental and that is concerned with redistribution should be embedded in the aspirations of the people. There should be connections between party members and parties, and even voters. You don’t even have to be a member of the party for you to be able to have a good relationship with the party. It requires an upgrading of political parties as we know them today.