"Farewell to Development’s Old Divides"

James Wolfensohn wrote an interesting article available on the Project Syndicate website. The former President of the World Bank wrote:

The fourth tier comprises countries that are lagging behind – the world’s poorest economies, with more than a billion people. They continue to stagnate or decline economically. Mostly located in sub-Saharan Africa, these “Laggards” are largely isolated from the global economy, and they face crucial development challenges.

This emerging four-tier world presents three key challenges.

First, we need to increase our efforts to ensure that the Laggards are no longer left behind. This requires policy changes as well as more generous and more effective aid. If one considers the issue of aid flows, one finds that though development aid rose in 2005 to $107 billion, most of the increase was geared towards “special circumstances,” such as debt forgiveness and for Iraq and Afghanistan. The sad truth is that development aid to Africa has decreased from $49 per person in 1980 to $38 per person in 2005. The true development needs of Laggard countries and other parts of the world are not being met, despite the rhetoric of scaling up aid.