Why the Goals are important

For the billion-plus people still living in extreme poverty, the MDGs are a life-and-death issue. Extreme poverty can be defined as “poverty that kills,” -depriving individuals of the means to stay alive in the face of hunger, disease, and environmental hazards. When individuals suffer from extreme poverty and lack the meager income needed even to cover basic needs, a single episode of disease, or a drought, or a pest that destroys a harvest can be the difference between life and death. In households suffering from extreme poverty, life expectancy is often around half that in the high-income world, 40 years instead of 80. It is common that of every 1,000 children born, more than 100 die before their fifth birthday, compared with fewer than 10 in the high-income world. An infant born in Sub-Saharan Africa today has only a one-third chance of surviving to age 65.

The Goals are ends in themselves, but for these households they are also capital inputs—the means to a productive life, to economic growth, and to further development. A healthier worker is a more productive worker. A better educated worker is a more productive worker. Improved water and sanitation infrastructure raises output per capita through various channels, such as reduced illness. So, many of the Goals are part of capital accumulation, defined broadly, as well as desirable objectives in their own right.

The Goals for hunger and disease are part of human capital. The Goals for water and sanitation and slum dwellers are part of infrastructure. The Goal for environmental sustainability is part of natural capital. The first Goal for income poverty is part of economic growth. And because meeting the Goals for hunger, education, gender equality, environment, and health is vital for overall economic growth and development, it is a mistake to talk simply about the rate of economic growth needed to achieve the Goals in a country. It is more helpful, particularly for the poorest countries caught in economic stagnation, to describe the range and levels of investments needed to achieve the Goals and thus to support overall economic growth.

The Monterrey Consensus offers a valuable framework for action, though many of its key commitments remain unfulfilled. Six important highlights are:

First, the world committed to a broad-based development agenda:

“Our goal is to eradicate poverty, achieve sustained economic growth and promote sustainable development as we advance to a fully inclusive and equitable global economic system.”

Second, the world recognized the need for a new partnership of rich and poor countries based on good governance and expanded trade, aid, and debt relief:

“Achieving the internationally agreed development goals, including those contained in the Millennium Declaration, demands a new partnership between developed and developing countries. We commit ourselves to sound policies, good governance at all levels, and the rule of law. We also commit ourselves to mobilizing domestic resources, attracting international flows, promoting international trade as an engine for development, increasing international financial and technical cooperation for development, sustainable debt financing and external debt relief, and enhancing the coherence and consistency of the international monetary, financial, and trading systems.”

Third, the Monterrey Consensus distinguished between developing countries that have adequate infrastructure and human capital to attract private investment (mainly middle-income countries) and those that must rely on official development assistance to build up infrastructure and human capital (mainly low-income and especially Least Developed Countries):

“Official development assistance (ODA) plays an essential role as a complement to other sources of financing for development, especially in those countries with the least capacity to attract private direct investment. ODA can help a country to reach adequate levels of domestic resource mobilization over an appropriate time horizon, while human capital, productive, and export capacities are enhanced. ODA can be critical for improving the environment for private sector activity and can thus pave the way for robust growth. ODA is also a crucial instrument for supporting education, health, public infrastructure development, agriculture, and rural development, and to enhance food security.”

Fourth, the Monterrey Consensus identified several regions where ODA is particularly necessary to meet the Goals:

“For many countries in Africa, Least Developed Countries, small island developing states, and landlocked developing countries, ODA is still the largest source of external financing and is critical to the achievement of the development goals and targets of the Millennium Declaration and other internationally agreed development targets.”

Fifth, the Monterrey Consensus recognized that significant increases of ODA would therefore be needed, and the donor countries committed to provide those additional resources, including the long-standing target of 0.7 percent of GNP:

“We recognize that a substantial increase in ODA and other resources will be required if developing countries are to achieve the internationally agreed development goals and objectives, including those contained in the Millennium Declaration. To build support for ODA, we will cooperate to further improve policies and development strategies, both nationally and internationally, to enhance aid effectiveness.

“In that context, we urge developed countries that have not done so to make concrete efforts toward the target of 0.7 percent of gross national product (GNP) as ODA to developing countries.”

Sixth, the Monterrey Consensus noted that trade is a critical engine of growth and that low-income countries need two kinds of help to improve trade: improved market access in high-income markets, and financial resources to remove supply-side constraints through investments in trade infrastructure, technology, and institutions:

“In cooperation with the interested governments and their financial institutions and to further support national efforts to benefit from trade opportunities and effectively integrate into the multilateral trading system, we invite multilateral and bilateral financial and development institutions to expand and coordinate their efforts, with increased resources, for gradually removing supply-side constraints; improve trade infrastructure; diversify export capacity and support an increase in the technological content of exports; strengthen institutional development and enhance overall productivity and competitiveness.”

With these six principles, the Monterrey Consensus provides a balanced approach to economic growth and achieving the Millennium Development Goals (UN 2000: paragraphs 1, 4, 39, 41, 42, and 36). The UN Millennium Project supports these balanced principles. In this document we build on them to recommend the practical steps that can result in the achievement of those Goals.