DISCLAIMER: This webinar transcript was loosely edited and there may be inaccuracies. 

Nikita Taniparti: Welcome to everyone for joining us today. We have a truly global audience with us and I’m very excited if this is your first time joining us for a development talk. Welcome to everyone else. Welcome back. My name is Nikita and I’m a research manager at the Growth Lab at the Harvard Kennedy School. But most importantly, I’ve had the privilege and honor of working with the Government of Namibia since 2020, with the Growth Lab, and in particular, it’s been a pleasure to work with Nangula Uaandja and her team. The title of our talk today is A Journey of Impact in Namibia, and you’ll hear questions from me about Nangula’s professional and personal journey, as well as the broader impact that the Namibian Investment Promotion and Development Board is having in the country. I just want to start a conversation by kind of going back to the beginning. So you were born in Namibia before it was independent and as a teenager in the eighties, you studied in Sierra Leone when you were in exile. How did that influence your worldview at that age and in particular your understanding of your home country of Namibia?

Nangula Uaandja: Thank you very much, Nikita. It’s great to be on this Development Talk. And yes, it was a times of excitement, but also times of challenging in the media at the time. You have mentioned, for example, that the first Namibian female, black female to qualify as a chartered accountant. I think maybe just to give context as to what was happening in Namibia at the time, I’m not the first because other women or other black people did not want to become chartered accountants. I’m the first black female and one of the first few black Namibians to get that qualification because pre-independence black people were not allowed into that profession. So the racial segregation that was practiced in South Africa, in Namibia then meant that black Namibians, there was certain qualifications and certain careers that were limited to them and therefore that is one of them. And those we went through education system that was not the most opportune for the time and that was one of the reason why I felt like I needed to join Swappable at the Image School and get the opportunity to study for the years. Of course, when you join as a teenager, you may end up studying for that, but if you are a bit older you may end up of course having to fight for Namibia’s struggle. So I was lucky as and I was within the age group that still needed to study further and I ended up in Australia. My world view has been impacted to number one by bringing in Namibia by my parents, by what I faced in Namibia, the injustice at the time, but also by what I experienced in Sierra Leone, the loving of a nation and a people that are appreciating and welcoming people who are not of their own. But they took us into their homes. The United Nations at the time is the one who funded our studies and they found homes and families for us. So, yes, while there was injustice, on one hand there was welcoming. And and whether it is the UN, it was made up of many organizations, many people, many countries, many cultures that supported the cause for Namibia and also the country where we went. It was families that looked after. So looking at that, therefore my focus is not about injustice or whatever. It’s about the angle and where everything misses. That is why there might be challenges in the world. On one hand, they are also good people and solutions that people and humans are finding for each other and for themselves.

Nikita Taniparti: I think that’s especially important not just to focus on the injustices that might have been an obstacle, but on the perseverance and the places that did serve as motivating factors to keep going. And so Namibia is even today still a young country got independence in 1990 and it has a strong presence of the public sector. And your personal extensive experience in the private sector, how do you merge and blend the best of both worlds today?

Nangula Uaandja: Yes. I think as you have indicated earlier, that is really where I ended up here probably is because I’ve been in the private sector. But being in the private sector, I think, yes, these are things that they say in the right place at the right time and taking a course of action, probably not because you thought about it, but because that is the way you are led. So my background is when I was at high school, I never knew accounting. So what I’ve studied is science. So I did physics, chemistry, additional mathematics, mathematics. And I thought, I will become somebody in the lab, in the laboratory or a scientist. And it’s for two reasons that I thought I would become a scientist. Number one is I was definitely good at science and I enjoyed it. Number two, I was not very good with people and I wanted to stay away from them. So because of those two reasons, I decided I will definitely become a scientist and be in the laboratory and mind my own business. But then there was a time for family and reason. My father was a business person, a small owner of a small businessperson, and yes, he used to pay taxes. And I thought, okay. Me being the figure person, I think the responsibility is on me to study whatever course it is that I need to do to help my father with his business. And I thought that was economics. It’s the only subject I’ve heard about. So when I applied to university, I applied for economics. And then when I was at university, I kind of find out. Now it’s only economics I need is accounting. So then I got accounting. I said, okay, chartered accountants. Okay, it’s not bad chartered. It’s like a charter plane. So you charter person. So I don’t need to work with people. I think I can still do my figures and everything else in the laboratory or in whatever I need to be to work on my figure. So it’s probably still going to be me and the figures, definitely not people. So that is where I started. But when I started working I was thought, no, that’s unfortunately, that’s not the way it works because we are sending you to clients and you need to be nice to clients and you actually need to work with people. So that was one of the challenges I faced earlier and therefore I kind of developed myself as in as I went on in that process of development and personal growth, I realized, okay, there’s a lot of cost to develop as a person. And then I consulted then. So being in that role, I ended up having clients from all walks of life international development agencies, government clients, and then private sector. And then I actually found out in Namibia that, yes, these everybody was playing a role and everybody want to do the right thing. But because of a bit of the past and some of the challenges that we have, we are not collaborating as much as we should. And I believe that I need somebody to help me get a formula on if we collaborate between the public, private sector and development partners, I think we can grow this economy. So then what happened in 2011 when I became a businesswoman of the Year, I was asked which kind of social responsibility project I wanted to do. I was already doing a lot in that angle, so I decided to do something. But I started working on how what do we need to do to grow and increase the trust between the public and the private sector and development partners so that they can work together to grow this economy? Because the challenges we are facing can be solved together when they realize that they actually all want the same thing and we need to work together. So that journey started in 2011 and then yes, because of that, I registered a few years later for my master’s degree. I’m currently busy doing my doctorate in business leadership so that I can just find a formula on how can we as a country of Namibia, bring better collaboration between the public and the private sector? And of course, with the support of our development partners, to make sure that we can utilize our resources better. Now, the private the public sector is the custodian and the stewardship owns the stewardship of Namibian resources. But many times we do know that the private sector has got complementary assets that can bring much of value to those assets. So where we are is how can we bring the strength of but the profit motive of the private sector and the social motive of the public sector? How can we bring it to the table and collaborate better for the for the benefit of our people? And that is really where the journey started. And that is what drove me to where am today. And I’m excited because I can see that we definitely have a public sector that has got a political will in everything that is necessary to do what needs to be done. And we’ve got a private sector that has the same feeling.

Nikita Taniparti: No, I think that’s very helpful. As you said, there’s a right time and the right place sometimes for this nexus of collaboration to happen. So for people who may be listening from other countries who are struggling with some of those same challenges of how do you bring those complementarities together? What have you learned about some of the obstacles you faced in trying to foster this collaboration and what’s worked well? What are the successes as you started to do this?

Nangula Uaandja: Something that we discussed is diversity is important and therefore bringing together diverse teams. And when you talk about diverse team, it’s not just in terms of ethnicity, it’s not just in terms of gender, but it’s also of background. What I see with my team today, we have got a team of blend, people with public sector experience and people with private sector experience. And I had this discussion with a colleague some time ago, which is the almost that cross we call it cross-pollination, cross-pollination of experience of private sector and experience of public sector. So where we are, for example, I do not have sufficient experience in public sector, but I need to make sure that I understand. What does policy mean? What is the importance of setting policy? And therefore and therefore I need to work with our ministers, I need to work with our executive directors in various ministries so that I can gain that from the experience. At the same time, I’ve got private sector experience and I know how the private sector works, how the private sector things. And therefore, when we bring the two parties to the table, that communication of having both of us. So I think one of the reason why I took up this role, I said we need a few people that understand what is driving the motive of government and also the ones that understand where the private sector’s coming from. And I actually said I’m probably one of the few in why I’m one of the few is because I’m a Namibian that was still born before independence. I went in exile. Yes, not for a long time, but I went in exile. So I understand the government and the people that went in exile. What were we fighting for, what we were fighting against and what we want to achieve from a social, national and other development perspective. So I have got that understanding, but I have worked in the private sector for more than 20 years. So, yes, I understand if you are a business person, what are you interested in? What are your objectives? What do you want to hear? What is on the table? So I think I have got at least, although I do not have sufficient public sector experience yet, I have got the heart of a public servant from where the background comes. And I will definitely be able to hear the side of the government and the side of the private sector and see how do we marry the two. And therefore, you need to bring people together that have got experience on both. And those people, what they’ve got experience on both. Those are the ones that will then almost like start the journey and start conversations and make sure that you bring together things that will bring solutions that consider the needs, the challenges and the objectives of both the public and the private sector.

Nikita Taniparti: Right. And Namibia is no stranger to facing a lot of challenges in the past and the present. So and today, how do we think about the link between attracting investment and solving Namibia’s current challenges of inequality, unemployment, and poverty? How do you see that playing out from your very pivotal role in that?

Nangula Uaandja: Yes, so I think if I can touch a little bit on the work that we did together with you, I think the work that we did together with you, we identified, for example, Namibia. So if we look at Namibia, we said between around about 2008 and about 2014 or 15. Namibia grew quite well. Our growth averaged to 4%. There was a time that it went as high as 8% and so forth. However, we noted that during that period, yes, we created employment but not sustainable employment. And also we did not it was not inclusive growth. So what were the challenges? I think the challenges that was highlighted through your study is, number one, it was driven by commodities and therefore, at the moment, commodity prices went down. Then the opportunities were also lost. Number two, it was driven by government by government spending. And the moment government spending was reined in, then we did not have so much opportunities available. And then number three, it was non-tradable. Therefore, where we have to come as a nation now is if we are going to look at growth going forward, we need to look at inclusive growth. So our current president, when he was elected a few years ago, which is probably seven or eight years ago, that he came into office, he said, I, our first president brought us peace. Our second president brought us stability. And therefore, what he’s aiming to do is to bring us prosperity, but it must be inclusive prosperity. And therefore, his mantra is, no one should be left. Out. And that is what actually what the first thing in Namibia for our covered you is leaving no one behind, no one left out. And therefore, when we evaluate investment and analyze investment that are coming before us is how will this investment help us address the challenges of Namibia? What is it? What are our national priorities? Our national priority is job creation. Our national priorities is yes, it is to reduce unemployment and to fight poverty. So if you are coming to us and you say you are an investor or we are attracting you as an investor, we need to know that is the something in for you as an investor. But what is it for Namibia and how inclusive will this project to be? So when we have that conversation then we have really, really good conversation because every investor will also want to make a difference to the extent or be seen to make a difference if they don’t want. So every investor that I meet actually wants to make a difference or they want to be seen to make a difference. And therefore, when you have a conversation with them of saying, how will your project help us solve these tribal challenges? So and then one of the things that then our president did is when he gave us the mandate of investment promotion, he also gave us a mandate of MSME development. And therefore, that mandate is really saying the really the reason why His Excellency elevated the role of investment promotion in MSMEs the to his office and to that to the office of the President is because he believes that MSMEs have got the greatest potential to create jobs. While large projects are important and they provide opportunities, the more job creation will actually come through the multiplier effect. And if we, as Namibians are not ready to be plugged into the value and supply chain of those projects, then we will not benefit. And therefore the challenge then that last bit before us as an investment promotion board is how do we support MSM is to make sure that they have got the relevant information, to make sure that they have got the relevant mentoring, training and development that can help them or that can enable them to access opportunities that are offered by investors. So yes, one conversation is with investors saying, can you support our development objectives and our national priorities? But then the other one is, MSME, are you there? Do you have the capacity to deliver? And so forth.

Nikita Taniparti: Yeah. And speaking about delivery, how do you see the relationship when you get pressure from the public sector to deliver results of investment and you get pressure from investors to deliver results to make it a better place to invest. How are you trying to mediate and negotiate that?

Nangula Uaandja: Yes. I don’t think we have won that battle or I’ve got the right answer, but I think we are making progress. And the progress that I say we are making is number one. There is great political will and therefore the support and the welcome with which we have received as newcomers to the public sector in US and new entities is actually overwhelming. So whether it is the support of His Excellency, with the support of Cabinet Ministers, whether it’s the support of officials, we have received actually good support. And therefore what happens there is, yes, we make our lists and how we are engaging investors. It’s actually we have been very, very practical. So we when you take a project and say, okay, yeah, investor, this is the project and this is what you need. We need to do for the project to succeed. What do we need to do? Number one, it’s probably just services, licenses and so forth that are required from government that are easy and therefore we work with the various respective government entities to sort that one out. Number two, it could be a policy vacuum. And therefore what we are doing currently is then working and setting up a committee that has got private sector players and public sector players to identify the vacuum in the policy environment so that we can fill in the gaps that are there. So the good thing is that I said we have received the support from government of saying and that is one of our mandate that has been given by His Excellency is that we can make recommendations on improvements to policy. So we are now working and reporting back to Cabinet of saying these are the policy gaps and this what needs to be done. And we have seen actually good support in that area and then from the private sector, we then making sure that we are giving constant feedback and we have got the investment facilitation office that is keeping them updated. So it is not something that you do in a day or in a week. But the good thing is the willingness of both parties to keep the dialog open and the channels of communication open is helping us to make sure that we achieve our objectives.

Nikita Taniparti: Yeah, absolutely. I think that’s very important because sometimes you need to zoom out to see what impact might mean to a certain entity. And depending on the time, it also can be zooming out a lot or zooming in. And I want it to zoom in to think about young and female entrepreneurs. How can a group like them contribute to creating a sustainable future for Namibia? So how do you balance an institutional way to create impact and promoting entrepreneurs to be uplifted and do that themselves?

Nangula Uaandja: Yes. So if you look at especially for young and female, our president is very much number one. He’s very much committed to the diversity and he’s very much committed to the young people. So I think he’s one of the first presidents on the continent who appointed a youth advisor. So President Mitchell is a youth advisor on youth matters and in U.S.. So and that I think is a big message that we have. And then secondly is then what we do. It’s any way you look at everything that he’s talking about or cabinet discussions is about what how which we how many women do we have? What is the inclusion of them of of the young people? But then what we need to do is then, of course, how do we support the young people? So for example, what we are doing is as a board that we are with our programs, they are some programs that we have designed and said this program is definitely for female entrepreneurs and this program is for the youth. So we have got, for example, a next gen affair that is coming up sometime in September is the first time that we are going to do it is a next gen being that as it may also, yes, I know that there is a history of exclusion from for women and so forth, but I’m sometimes a mother of three boys, so I am concerned that sometimes we are leaving our boys, especially in Namibia. So Namibia is one of the countries in them, one of the countries in the top ten countries that are doing well with females. And actually we have got university ranking and so on. We have got quite good female representation in many, many areas. So we are doing well. So I’m actually afraid of our men in Namibia of saying if they don’t start pulling up their socks, I think it will be a women country very soon. So I need to make sure that projects and everything that we need to do is diversified and with means. Diversified is make sure that we include women, but not at the exclusion of of of of male counterpart.

Nikita Taniparti: Definitely. And when you think about this spatially, when I visited Namibia, it’s very obvious there are many parts of Namibia that you think you’re in five different countries. So how do you think of integrating spatial? Discrepancies are bringing empowerment to different places in the country.

Nangula Uaandja: That is a is a very, very challenging one. And I think that one is really where we need to pull our heads together because the one thing is these many people with many objectives and you have to work with partners in one thing that one always does in life is one institution or one person is too small to make greatness. I think somebody like John Maxwell says one is too small a number to achieve greatness. So if you want to achieve greatness, then you need to start a movement. And a movement gets started by a small group of people and it’s just by leading by example of making sure that you bring in diversity. So, yes, the country and the government is putting policies in place that are going to that are driving and supporting inclusivity in all sectors of our lives. And therefore, normally, whatever policy or whatever proposal, for example, we take to Cabinet, the question always comes. We have got a minister of gender and that minister always looks at it from that, from that angle. And also that ministry also deals with poverty and marginalized communities and they look at it from that angle. We are making sure that we are inclusive. And that is the question then normally that all of us, when we vote, we are engaging. So for example, one of the engagement at the board is many times we communicate on social media, but when we communicate on social media, we are being very, very exclusive because is many people that are in the remote areas of Namibia, they’ve got a phone and they actually have got a cell phone and they’ve got access to a 2 to 2 cell phone network, but not necessarily on Facebook. So normally we then react to what is coming through on Facebook, Twitter and so forth. But there’s actually many people that we are not reaching. So what medium of communication are we using? And those are some of the questions that we are asking. Are we on radio? Because actually then radio is still one medium of communication in most areas in Namibia. And are we on television and BBC because many people still watch NBC. So we need to challenge ourselves in everything that we are doing from medium of communication and reaching out. And when we started with our team that is dealing with Msomi that the first thing that they did last year and they produced a report is go to all the regions of Namibia, all 14 of them, and make sure that before we do anything, understand what are the people saying with regard to the MSME mandate? What are the challenges? They put their report together and that report is helping inform our responses to the challenges that we are facing.

Nikita Taniparti: Yeah. And even though, as you say, one institution might not make the difference of a full movement in the institution of, for example, the Investment Promotion Board, how do you, as a leader go about crafting a workplace that fosters innovation, risk-taking, collaboration, and a reward for finding new ways? Or, we call it positive deviants for breaking the rules?

Nangula Uaandja: Is it always challenging that one? So when we put our core values together, we actually really spend a good time thinking about our way, our how and what. And we had a good weekend that we had, almost like with all our staff, with all our management, with the board at the beginning to discuss that. And we came up with our core values, which means which we call Namibia. So the acronym for our core values are Namibia. And we say that if you are an employee of the board, you must be like a true Namibian and a true Namibian and the kind of stands for no one left behind. And therefore, inclusivity, of course, is important, and then it stands for accountability. So we must be accountable in everything that we do. And M stands for making a difference. And I stands for integrity. We must be, of course, we are dealing with information and data from investors, their business plan and so forth, and that is important in Namibia. And then B stands for Brilliance. We must act with excellence in everything that we do. Another eye for innovation. And then lastly with agility. And what I tell my people is this one If if a problem lands on your desk and that probably goes with what if you have things in my life. So let me kind of come back to the message that I tell them. But let me say something. Yes, anomaly. In a few years or month ago, I was asked to go and talk somewhere on responsibilities or something like that. And then I started by looking on Google and the responsibilities of in Namibia and I could not find any sites. Okay, let me go to the Constitution and find that in the Constitution. What is the responsibility of an amphibian? I didn’t find anything, so I actually found that the responsibility of an American. I think America is the probably the only country or one of the few countries where the citizens have got responsibilities. I think it’s almost like a responsibility to take up to do. Go and fight or so on. I looked at a few, so I know that America has got some things. I use this example and I thought, I think now this is why we have challenges. We have challenges because we have got people with too many rights and fewer responsibilities. So what happens is I looked in our Constitution when I typed in write, I could not count with the right but responsibility. There was nothing. So then I think that is one thing. If you ask me, life is and somebody said, complete that sentence. Normally I completely say life is a responsibility and that is maybe how I was raised. That is my perception in life. Life is a responsibility we are here to achieve and we need to be accountable. And one day there will be questions as to what did you do with the time, with the hours, with the talent and everything that it interested in to you and I must be able to answer that question. So having said that, now what I tell our people is if a problem lands on your lap, then it is yours. It does not matter if it is not your department, if it is not, whatever. It is your problem. Until you find somebody who has dealt with it. So let’s call it. You are in a department. We call it up talking and somebody calls you and they are asking about msomi. You cannot tell that person and said no, I am from aftercare. The person is not from whatever it is, become your problem. So now what you do is you go to somebody in Msomi and tell them, I have got this call and this person, you refer them and then you follow up with them, have you address this problem. And therefore what we really look in innovation is being resourceful in providing solution. And many times when people looking at look at innovation, they think innovation is a technology matter. Innovation is not a technology is about solving problems. And those problems can be solved in a matter of technology. They can be solved in another way. But I think it starts with looking at problems, looking at challenges and saying, how do I solve that problem? And therefore we need to create a culture of solve problems for all of us. And that is normally the skill I teach the people. So yes, I normally have good conversation with my children and they tell me, Money, please, for now, just be a mother. Don’t be the teacher and the coach and tell me what other good I will try. I don’t know if I know the difference, but I will try because any conversation with me, it’s a conversation about challenging your thinking, your way of thinking, and the action you’re going to take. And I think once you do that, then you can help people to think differently and you can help to people to find solutions to the problem. And once you are able to find solutions to problems, you can innovate. So that is the approach and that is the kind of so it is in our core values. And we demonstrate and again probably come from the environment where I come from a chartered accountant, we go through three years training and coaching and therefore we say 70% of our job of development is done on the job coaching, 70%, 20%. It is more like peer group learning and 10% in classroom. That is the profession where I come from and I believe that it has helped me grow in areas where I never knew I could do. I always thought I’m not an innovative person, I’m just a good auditor. I will not lead the company, I will not become a CEO. I think that training has helped me to think differently and that is how I engage with my team.

Nikita Taniparti: I think I was going to say it’s easier said than done to challenge conventions, but you’ve made it obvious that actually it might be easier. And thinking about the core values. Sometimes there is a tension, especially women leaders today, who sometimes find. I find it hard to find that balance between creating success that society might expect and creating a holistic life that is about a lot more so. From advice that you have gathered over your career and your life, what advice would you give to other women trying to find that balance?

Nangula Uaandja: I think two things. Number one. And this is courtesy of Anna Marie Slaughter. I think she’s an American lady who works at the university. And she worked, I think, with Hillary Clinton in the State Department at some point. And she wrote something on women can still not have it on. So, number one, I think as women, of course, accepting that we can still not have it all. You cannot be a full-time mother and a full-time professional. You will die. I’m sorry for the use of a better word is you cannot. But I have seen, especially in our culture, that women are still in a place where they are forced to do it all. So I’m sorry. I used to I kind of used a few examples, but here comes my 11-year-old son, who’s now 11. But at the time I think he was seven and so on. So he was telling me, Mommy, I think our teachers favorite mother is so and so’s mother. And I say, Why is so-and-so’s mother your favorite friend to the teacher? Because she comes to the school, then she brings cookies and she feels whatever. And I think maybe my face looked a little bit this one did because I just realized I will not be able to measure up to this mother. And then you look, the thing is, is a no, don’t worry, mom, you’re still my favorite also. So that was good to hear that I’m still his favorite, although I’m not the favorite of the teacher, which says that the main message. So I have to accept that I cannot be leading an institution of being there and at the same time baking cookies and taking them to school. I might try, but it’s not my strength and I don’t want it to be the area of my focus. I need to accept that that is not what I need to do. Of course, I need to accept that I need to be a mother. I need to accept that I need to be there for my children. But I need to also accept that I will not be able to compete with the perfect mother who is full-time at work, at home, and who’s choice. It’s also a great and brilliant choice. Just like that, mother will not be able to compete with me in the professional area. We are making a difference. We need to make peace with that. And I think many times and that is a conversation I had with young ladies at BWT one year ago saying, I think many times the pressure comes from ourselves, the pressure sometimes comes from our families, but then the pressure comes from society. So number one, me as a person, I need to make a decision. Number two, me and my family need to sign up to that decision. And then number three, we need to kind of allow society things so that that’s what you think. But in our family, it works differently. We need to make peace with that. So that is the first one. The second one, which is then two. That one is then you must have a good support structure and support structure is there support structure is because you and your spouse have decided that you will be the career woman and he will be at home or the support structure is both of you are career people and therefore you need other people who will fill in. And I think that is one thing that I’ve been blessed with. I’ve been blessed with people in my life that have been there for my children. I’ve been blessed with brothers, sisters and friends who are able when I’m traveling to pick up my children, sometimes I travel and I forget to tell my sister I have trouble. Then I desire her calling me. Have you made arrangements to drop kids to school? No. Sorry. So. So. So I have got people in my life who will help me to make sure that I do not drop the ball. And therefore that support structure is very, very important. So those are the two things. Number one, accept that you cannot have it all. You cannot be 100% in both. And number two, have a good support structure. I think that has worked for me and that’s what I would recommend for other women.

Nikita Taniparti: I will definitely keep that in mind. I know I could talk and ask you questions for the rest of time, but I know we have a lot of audience questions coming in, so I want to take a step back actually, and ask more about your role at the NFB, because something we talked previously about was some of the obstacles and challenges you faced. But in specifically getting a true investment, what’s the biggest challenge? Is it getting investors to be more aware of where Namibia is? Is it the commitment device of going from interest to investment? Is it the aftercare? Is it making sure that investment brings about then the downstream societal benefits? Also, what keeps you up at night?

Nangula Uaandja: So I think maybe let’s start with Namibia. Yes, there are places where we need to make sure that we put Namibia on the map. It is not probably the first country in Africa that people think about when they want to invest. So there is that portion, that portion of investment promotion. But what I’m saying, currently, we made the. Presentation to Cabinet. And we are seeing that the effort that is being made in that effort is not only being made by the media investment, promotion and development, but actually we said that the chief promotion, the Namibian promoter is our president. He’s the head of the Namibia Investment Promotion and Development Board. And yes, he’s the head of Namibia. And wherever he goes, he makes sure that he takes a team with that is meeting with business delegation. And he has been doing that for years. And I think that message is there. And yes, we are seeing quite a number of investments. So where we are currently standing right now, we are standing at a place where we are not putting together projects enough for people to invest because we have got enough investors that are coming in with their project. So I think that is a good place to be. So facilitating impact is what we have. So yes, we need to get Namibia on the map, especially in one of the diversified in some of the diversified industries and sectors that we want. We are promoting Namibia and we are going on investment promotion effort then. Then beside doing that, then what we need to do is the facilitation. One of the challenges that we face is if you look, Namibia is ranking on the ease of doing business even though that report is no longer the we were ranked at number 104. So when the president appointed me, one of the two of the things that he gave me as the mandate is, number one, we must improve Namibia’s ease of doing business ranking and Namibia’s competitiveness ranking. So those two, it’s internal work that we need to do. Namibia So while investors are there, what they were doing before is the institutions that we have in place. They were not empowered and capacitated enough to solve the challenges and support investors. And I think that is the one difference that we have. So with the board now in place, we have been given sufficient resources that are necessary for us to facilitate investment. And therefore, therefore the speed with which we implement is actually what is keeping me up at night saying as a people and as a country and as a public sector, will we respond to the requests before us with enough speed? Because these are a few things that we need to correct among us. So with a presentation that we made to Cabinet, we identified, these are the investments, for example, that we have. Some of them could be stalled. Some of them are taking time. And for each one of them, this is the reason. Yet some of them are in the hands of the private sector and the project promoters. But some of them is because we are awaiting a policy that need to be finalized or some of them we are waiting for license to be issued. The good thing is that when we made the presentation, government made a commitment of saying come back to us and on a monthly basis give a report on this committee on how this is progressing. So, yes, I think most of what was keeping me awake at night was our own coordination. But I have got the support that is necessary for me to do that coordination, bringing investors. I think we are doing well as a nation to make sure that we promote Namibia and especially with our current green hydrogen potential, the current oil discoveries. I am feeling like we need to promote and that maybe are not as a country of saying these Namibia, I think we are now getting there on the map. To promote Namibia as an investment in other sector than other than natural resources. It’s one thing that we are now doing as a board. And then when investors come to make sure that we facilitate investment and yes, the aftercare, that is the challenges that we need to address.

Nikita Taniparti: Yeah. And just to probe a little bit, when you talk about the rankings of the doing business or competitiveness indicators, what are those rankings not capturing? If you could change those, kind of that’s what the world looks at. But there’s more to the story. So what do you think needs to happen beyond just those rankings to create that investor confidence in the country?

Nangula Uaandja: Yeah. So I think maybe from a competitiveness report, for example, what it’s not capturing. So Namibia is a country with 2.5 million people. So everybody kind of tells you are a country to make 2.5 million and therefore they tell you market size is one of the determining factor. But then we say, okay, Namibia, a country with 2.5 million. Yes. If you want to come to Namibia as an investor and still to Namibians, we do not have sufficient market size, but we have got great market access. So what about the fact that we are part of SACU and therefore if you invest in Namibia, you’ve got unlimited access to South Africa. But on the letter to Swaziland in Namibia, what about the fact that we are not part of the Africa Continental Free Trade Agreement? They are the access that we have got to then a market in the US and EU. We are probably the only African country that is exporting meat to China, EU and America. So that is the example. The other one that I think does not happen is always sometimes speaking to the right people. So somebody issued a report the other day, and I’m wondering, this person didn’t speak to me and they’ve got views on Namibian economy. I wonder how can that view have that view if I am having this whole list of investment projects and nobody spoke to me, so identifying who they speak to and having a balanced view about who they speak to in-country, I think that is. But so who do you speak to in-country? Do you have a balanced view? Do you only listen to one or two players in the private sector and make up your mind? Or do you really speak to private sector players more than one public sector players? And then, of course, make sure that every you are not only keeping to your last year list, you find out if there is a new kid on the block and also speak to that kid on the block and say if they have got hope, what is that hope based on? I think that is probably one of the two things that if you ask me now that we will change. I am not saying that the reports are completely wrong. I think the report there’s a lot of truth in the rankings from what of some of the items that we are experiencing that yes, as a country, there’s a few things. We have got the will, we have got the intention. But what was missing was the coordination. So we have got many, many institutions, and each one of those institutions was acting in isolation. So from the ease of doing business and therefore we need to work on manners, on how can we bring about coordination and how do we make sure that these who like one point of entry, that an investor can speak to one person and they will be able to be linked to all of public sector in public service. So, yes, they are not saying that the report are incorrect. I think there is a lot of truth to the report. But yes, there is one or two things that can be done.

Nikita Taniparti: And if we think about maybe a sector like green energy, that’s everyone’s trying to understand it as it evolves. It’s not the same as maybe a conventional sector where investors know what to look for. So how do you mobilize the resources or the information regulation ideas to help promote investment in something new like green energy?

Nangula Uaandja: So the good thing with green energy, I think that His Excellency did very well at the beginning, is made sure that he’s economic advisor, was almost like taken away from many other responsibilities and given the role of green hydrogen commission saying this is a new sector, we know nothing about it, we want everything and this is the timeline. And, that green hydrogen commissioner spend his time understanding what is this green hydrogen sector? Who is the best? What drives it? And I think by the time we got to the table, I think we were probably faster than any other country in the world. And I’m not saying we were the first. I’m saying we were faster because other countries were ahead of us. Other countries came after us. But I think something that was done is we were really, really fast in coming up to where we are. So because of that, we have gathered materials, we have reached out to players in the industry throughout the world and we have got quite significant interest. And yes, for that one. Then we have got the green hydrogen commissioner. Then what we did, what the President did, and also is to set up a structure, an inter-ministerial committee, so that in the ministerial committee bringing all the kind of type of organizations that are required to drive this together. And they are having a meeting every two weeks to discuss green hydrogen, and it’s called the Green Hydrogen Council. And what are we going to do with that? And because of that, I think we have got a good strategy that is being driven right from the top. And I PDB had the role of saying, how do we bring the private sector in and what is their role? And the green hydrogen commissioner is bringing it all together. So the setup and the structure was great from the beginning. It had quite good focus. And because of that, the promotion is is being actually led by His Excellency and the Green Hydrogen Commissioner and then specifically the Investment Board, providing the support to the investors that are being invited to the countries, making sure that we support and making sure that we bring our private sector in and making sure that we are taking along our president in green hydrogen commissioning effort.

Nikita Taniparti: Right. And I think while it’s challenging to have so many voices in the room, have to agree to something to make it a reality, that’s how you might meet, get the necessary buy in to make a theory, a reality. And so we we talked a little bit about the goals of investment promotion on the social development side. And there is a question from the audience about how the government thinks about more conventional, traditional systems of taxation with the idea of social investment. And they ask, for example, instead of having a large investor paying taxes on profit, what if that amount of investment was specifically invested towards an upskilling program or kind of a more direct channel for that profit to go in the country? So how do you think about this, how Namibia thinking about this?

Nangula Uaandja: Yes. So we are not there yet. And I think, of course, where we are not yet that there yet is because for example, our physical budget at this stage really funds a lot of social programs. You had probably, for example, Namibia has got the best-ranked roads in Africa. So investment in infrastructure comes from government and government entities. Our education system is a universal education system which is free. We have got a medical that is free, for all people, except those that belong, of course, to medical aid. But even if you belong to a medical aid, you can go to state facilities for free. So government is really, really supporting a lot of activities. And we have got training programs with vocational training. And because of that, for a government to reduce their physical at this stage is a little bit limited. But what I know the Minister of Finance is doing is with our promotion effort, we need to almost come with the link of saying how do we increase our kind of base, our tax base, so that we can reduce the rate? And when we do that, we will be able to have conversation then that the type of conversations that you are having. So yes, they are, for example, strategic project that we are talking about currently about how do you incentivize strategic project is a conversation that we are having and in incentivizing strategic project is for example, we had a regime called the EP Z Export Processing Zone. If you are an investor that is coming to Namibia and 95% of your products or 90% of people that are going to be exported and not be put in Namibia, then you will pay zero tax. Unfortunately, with that one, we know that there is also a world. That is going against texts, heaven have beens, if one can put it that way. So we as Namibia was blacklisted by the EU because of a program like that one. So when we come up with nice incentives and text for so forth, we sometimes face challenges. So we had to pull out our epithet because we were listed by the EU as a tax haven, because our tax rate, we’re kind of making entities move from countries and they end up paying tax somewhere at all because they can come to Namibia in the pretax. So we have to make sure that we work with the global community in coming up with taxes that actually respond to the needs of order to the fairness in the system. So having said that, and therefore then kind of saying it’s a zero tax forever, it’s probably not going to do two to play. But we need then we are now busy now studying saying, okay, if we are blacklisted for that, does that mean no incentives or is there some incentives that are working and we are busy finalizing.

Nikita Taniparti: And there may be some sequencing element to that as well. Exactly. And I think throughout our conversation and also having the privilege of knowing many people that I BDB, you have a very strong team and you obviously think very deeply about who you have around you working with you. So who do you look for when you recruit people? What are the skills and personalities and people that make your team a success?

Nangula Uaandja: Yeah. Thank you for that compliment for people. I actually think I’ve got a great team. I tell people I think we have a great the best team in Namibia, but I’m sure that it’s open to debate. But yes, the one thing there’s many people that’s so many things about hiring. So for example, somebody like Simon Sinek will probably say high-level attitude and you can always develop the skills and some other people will say, have you slowly and fail fast, and therefore you kind of have to make sure that you learn from that. And therefore, yes, normally what you do with the hiring is that skills is critical and skills is important. But many times when we hire, we focus too much on skills and we be less attention on attitude and other aspect. So one thing I have learned and from the many mistakes I have made in my career and in Journey, is hiring just for skills and hiring the top student at university is all good and well, but that person must have a adaptability, adaptable kind of personality, and they must also have a learning ability. And of course, my own example is one, if I did not have adaptable and learning ability, John Maxwell says, when our ability, our distances or when our attitude, our distances, our ability, even the impossible become possible. I had abilities, but I think what helped me more was my attitude because first I am I was not the right person, but my attitude was attitude of learning. And because it was attitude of learning, I developed from a laboratory loving person to somebody who can actually lead people. So we need to make sure that when we hire our team, they must be good at what they do. And therefore we need to set the quota of things from a skill perspective. This is where you have to be. And then number two, it’s then from an attitude and psychometric assessment level of saying these people, which kind of people are we having on the team? And the good thing, I think that we have and having an inclusive team is when we hired a team, I was concerned that what if all people come out are black females? I cannot have a team of black females only. I cannot have a team of me as a black female and all the other people are white males. So I was concerned about that and I thought, okay, do I go to one of the panel and tell them, please know this is your first candidate. But no, we have to go for your second one because my diversity numbers are not working. Luckily, I did not have to do that. So I think I prayed and I got the answers and they point that out. And so it all worked out very well. But I think at least in the beginning, I knew what I wanted. I wanted people that have got the right skillset and that right skill set is the technical skill set, but also the attitude and the soft skill set. I wanted those people. Then number two is those people must be a diverse team. And because of that, whenever we are looking through everything, we knew that we are making sure that we are getting that.

Nikita Taniparti: Yeah. Yeah, no. And I think you’ve learned a lot from your past. And I wanted to kind of close out our talk by asking you to reflect a bit on your past and look ahead to the future. So when you look back, what would you tell your younger self, your 18-year-old self, ready to take on Namibia and the world? And maybe this even includes an example of a mistake that you are about to make because we talk a lot about achievements, but maybe what’s a mistake or a failure that has really shaped who you are today?

Nangula Uaandja: Yeah. So you know what I look at in life now? I have very, very few regrets. And it is not because I have not made mistakes. It’s because I think I am the sum or the product of my experiences, the bad ones and the good ones. And I’ve had my fair share. I have had my fair share in my personal life, whether it is tragic loss and so forth. And I have had my fair share of my career where I was probably always ranked the number one and ranked one and being one at university. And I came to a place where I’m told, you are not the darling here today, because although you are good, technically you are not good with people. And if you don’t sort that one out, irrespective of your good technical, we will fire you. So, so I have got those experiences, but I believe that those experience of this. So normally people ask, what will you change? And I’m saying, I will probably not change anything because I love what I’m doing. I love where I am. And it’s because I’m a product of my experiences. What do I need to do more? As I look forward, they say, Look, I need to listen more. I am not a very good listener. And the none of the mistakes that I’ve made in life is because. And it is because before I put the problem on the table, I probably interrogate the problem. And because I think about the problem long before I brought it in the table, I always believe I have analyzed it in all angles. And when I come, I know what I what needs to be done. So but then sometimes I leave other people behind because when I come I have thought about this for the last year and the next person is new and that person may actually look at it from a different angle than mine because my judgment might become a little bit kind of biased because of that experience. And that is one of the items that I’m continuously learning and continuously developing. It. Been with me for life, and it used to be with me. I think I accepted that every day to listen to the other voices in the room and consider what I’m suggesting. Is that still the right course of action or do I need to change that? So. That is. Though. Tell. My younger self. I think. Because my younger. So forth. Not that it might kind of match as a. Accepted the weakness among black people alive. I leave to challenge myself. It starts with being honest about who you are. Be my team. My team are not very good. At least you are allowed to call me up and said to the other person. So if you are not that person in the room and you think I’m not listening to the other person, call me out and say No black, give the other person an opportunity. And that is holding myself accountable in that regard.

Nikita Taniparti: I have no idea what you’re talking about because you are a wonderful person and I learn from you all the time. And that’s actually going to be the theme of my closing question is, looking forward, you’ve now become a role model for me. Who are the role models in your life? And also you’ve worn so many hats throughout your life. The scientist, accountant, private sector. Public sector. What’s next for you?

Nangula Uaandja: So role models. I’ve got so many. So of course, it always start with my parents. What my father and my mother taught me is what keeps me to date. We used to say that if you get in my car with my father from there not to win, because about 800 kilometers he will start preaching by the time you get into the car and he will a bridge and if you to. So it’s all. Oh, my God. This will. We are in the car with my father again trained us and therefore he is my role model. He was not educated, but for that he has achieved a lot. So my parents, my mother is strong women who have achieved a lot. I’m a role model so I have got quite a number in Namibia. Whether it is the First Lady, whether it is our Prime Minister, whether it’s our deputy prime minister. Women like Hillary Clinton, these women that I admire a lot. And then, of course, these leaders, whether they are male and female, David Fourie, the guy who recruited me to Namibia, I think is the most brilliant person in the world, somebody like John Maxwell, who just writes and I am who I am today because of reading his work. And then other leaders whose work I follow, like the Simon Sinek, have talked about Patrick Clancy on him and a few other people that if I needed to develop in my people management skills and in my leadership, I, I read a lot of their work and then of course I am very much good on the Bible so that I believe it’s the top leadership book. I have read it every year from Genesis to Revelation, and every year I find new leadership tips that helps me on this journey. So that is where I draw my inspiration. Those were my role models. What next for me, I think. Normally I tell people one thing that I’m very good at is being focused on one thing. So when people are used to ask me, Where will you be in five years? I say, I’ve got no clue because right now I’m here and this is what I am doing and that is the only thing I’m thinking about. So when the next opportunity comes, God will open the door and when He opens, I know that is the door and I will enter. And I think right now here is the news, the tuition we entering my second year and I’m seeing that we need to take this institution to a level I am committed here for a five year contract that I have been given beyond the five years. I have got no clue to whatever happens the door, the right door will open. And when I win that, when I’m shown it is the right door, I will enter that right to do so. Normally. That is the I for that question. And it’s not because I’m being trying to be funny. It is really because I’ve never ended up where I thought I will end up. I have ended up where I did not. Like I told you, I thought I would be a scientist right now in the laboratory or maybe working somewhere at like an engineer at Nassau or something like that. But I guess you look at where I am…

Nikita Taniparti: So it can still happen.

Nangula Uaandja: and where I plan to end up. So I am looking for the door that will be there after five years.

Nikita Taniparti: No, it can still happen. No, we are very, very we learned a lot during this conversation. I especially think you left me with a lot of practical and professional and personal advice, and I’m sure people listening even later will gain a lot of wisdom. And I’m very excited that the growth lab gets to come and continue working with you and your team. I think we’re very privileged and honored to be able to know so much about Namibia and help the country at this time of transition. And I wanted to say thank you to all the participants and the people joining this call. If you have any questions, please reach out to us and let us know. And Nangula, as always, it’s been a complete pleasure to get this time with you and we really appreciate it.

Nangula Uaandja: Thank you very much and thank you for a good talk. It’s a pleasure to be with you. And it’s a pleasure to work with the hub of the growth lab. We are doing great work together. And together we can make a difference for our country.

Nikita Taniparti: Absolutely. Absolutely.

DISCLAIMER: This webinar transcript was loosely edited and there may be inaccuracies. 

Syeda Masood: Welcome to the fourth panel in the Diversity in Development Series. My name is Syeda Masood and I am an alum of the MPAID program. I graduated in 2008. Currently, I’m a Ph.D. candidate at Brown University doing a Ph.D. in sociology. This series is a result of a collaboration between the Growth Lab, the Center for International Development, the MPAID Program and MPAID Alumni Community through Elevate, which is a group of alumni seeking to support the program in thinking more seriously about racism and colonialism in its curriculum. This collaboration is a testament to the interest in having a platform to talk about questions of diversity, inclusion and development in our community of academics, practitioners and policymakers. The broad goal is to have is to have thoughtful and informed discussions about racism and its linkages with colonialism in the field of development from academic and practitioner perspectives, as well as from lived experiences. I also want to acknowledge that Harvard University has pledged $100 million this week to redress its ties with slavery. As the title of the session indicates, today’s talk is about the connections between the history of colonialism in the world and the biases prevalent in the international development sector and the practice of development more generally. Both of our guests today will discuss what their vision of decolonizing development looks like and what the road ahead might entail. In previous sessions, we asked fundamental questions about diversity and development and heard from several MPD alums about their personal experiences at the intersection of that. Today, we go further and discuss how historical forces shape and influence the practice of development, quote unquote, as we know it today. Without further ado, I’m thrilled to welcome our panelists today. Zophia Edwards is an associate professor at Providence College in Rhode Island. Her research examines the impacts of colonialism and multi-racial labor movements on state formation and human development in the global south. Her work is particularly focused on the Caribbean. She holds a Ph.D. from Boston University and is currently writing a book with NYU Press. I found out recently on modernity as seen from the Haitian Revolution, which I’m very excited about. Olivia Rutazibwa is currently an assistant professor in human rights and politics in the Department of Sociology at London School of Economics. She is an international relations scholar. Her research and teaching focuses on ways to decolonize international solidarity, including development. She is also associate editor of International Feminist Journal of Politics and recently joined the Editorial Board of International Politics Review. I want to welcome Professor Edwards and Professor Rutazibwa while also acknowledging that this is an all female person of color. And all the panelists will speak for 10 minutes each, and then we will have a 15 minute Q&A, a 15 minute Q&A between the three of us, and then I will open it to Q&A for from the audience’s. Please feel free to write any of your comments and questions in the Q&A. I will read out your name and question to the panelists. I want to especially also thank Tim, Nikita and Chuck and the Growth Lab for their help with organizing this panel. An excellent way. So I want to first ask Zophia to start her discussion for the next 10 minutes.

Zophia Edwards: Thank you so much, Syeda. It’s a real pleasure to be here today. I’m really excited for the conversation and I’m really happy to be on this panel with Professor Rutazibwa because I’ve been wanting to chat with you for a long time. So I’m very excited for this for this panel today. So I’ll start with sort of this book that I want to kind of draw attention to that has been marginalized in development studies. This year is the 50th anniversary of Walter Rodney’s How Europe Underdeveloped Africa. And about a month ago, the Walter Rodney Foundation hosted a celebration for the anniversary of this seminal text. Walter Rodney was a Guyanese born historian, a committed Pan-Africanist and Marxist in the Caribbean radical tradition. And he first published this book in 1972, just before his 30th birthday. While this work is under appreciated in mainstream development studies, the text is globally recognized as essential work on African political economy and development. And in this book. Rodney does a lot of things. He extends a meticulous and a rigorous Marxist analysis to African economic and social conditions, and he exposes how underdevelopment was produced actively generated by centuries of systematic European plunder and the enslavement and labor super exploitation of African peoples. So he is different from many historians and social scientists at the time who places the blame of African development not on African people, but rather on the European driven global capitalist imperialist system as a whole. But the book is. Not just another argument within sort of what we think of as the dependency school of thought developed by Andrea Goodnough. Frank Cardozo For little, for example, because he goes beyond that, some of his noteworthy interventions include completely upending the dominant Eurocentric imperialist narratives about the economic and social conditions in Africa and challenging hegemonic conceptualizations of development. So in how Europe, underdeveloped Africa, Walter Reed argues. If under development were related to anything other than comparing economies, then the most underdeveloped country in the world would be the U.S., which practices external oppression on a massive scale. While internally there is a blend of exploitation, brutality and psychiatric disorder. So here, Rodney really flips the concept of development on its head. Of course, he sees basic indicators like food requirements, life expectancy, social services, public health and education as all important aspects of human flourishing. But he argues that the hegemonic conceptualization of development is specifically capitalist development, the accumulation of wealth through capitalist social relations, and that an integral part of capitalist development is racism and colonial domination. In fact, racial and colonial oppression, enabled capitalist development, and its ongoing operation as an economic system. European planters and miners. Enslaved Africans in order to exploit their labor power and generates wealth. Then, having become utterly dependent on African labor and African woman’s reproductive leave, I will also add we should not forget this. Europeans in their countries and abroad found it necessary to rationalize and justify that exploitation. So they used and proliferated erroneous and unscientific racist ideas. I’ll quote him again where he says Racism, violence and brutality were the combatants of the capitalist system when it’s extended itself abroad in the early centuries of international trade. So some questions I want to introduce for us in this conversation today is what happens when we conceptualize development as racial and colonial oppression? What does this do to the study of development? How does this invert our understanding of which countries are quote unquote, advanced and which are not? And then, by extension, how would we measure racism, violence and dispossession in contemporary terms as well? And I would say that we do have dependency on the systems theory that these scholars are very strong in terms of operationalized in the colonial and neocolonial architectures of extraction and exploitation. So these scholars talk about, for instance, the adverse impacts of foreign direct investment, foreign aid, foreign loans, collapse of international financial institutions, and so on. On the autonomy and self-determination and development of countries in peripheral regions of the world. But I would say rarely do we see them articulating explicitly racial oppression historically or contemporarily as part of their analysis of uneven development. And then if we look at the branch of research. Most recently that looks at the relationship between colonialism and development in some of the most cited papers in these contemporary studies. They operationalized colonial domination or colonial rule, as they call it. As the number of Europeans who settled in a colony or the number of European descended people in a colony. The number of police officers. The number of court cases that were presided over by colonial officials, the size of the colonial state, the length of colonial rule, these kinds of measures and I’m thinking of studies like Acemoglu, Acemoglu and Robinson’s work Mahony land these these these scholars and these studies invariably find that the greater the European presence in a colony, particularly with Acemoglu study, the more favorable the development outcome. These studies talk about the institutions that these Europeans built in these colonies, institutions of private property rights, law and order, etc., as positive attributes and. Well, positive attributes of colonial rule in the sense that this was the necessary administrative infrastructure that led to positive read development. But virtually none of these studies conceptualize racial domination as linked to colonial domination. But in Rodney’s views, these indicators are precisely the indicators of the architecture of colonial violence against people who are racialized as non-whites for the purposes of legitimating extraction and super exploitation. And racism and colonialism are intimately intertwined. So Rodney, for instance, says, and I quote, It was economics that determined that Europe should invest in Africa and control the continent’s raw materials and labor. It was racism which confirmed the decision that the form of colonial of control should be direct colonial rule. So what if we took a critical stance on colonialism and assessed racialized colonial violence, as opposed to this terminology of colonial rule as a driver of capitalist development in the core? How would we conduct our research differently? Conceptualizing development as racial violence and plunder might lead us to want to, for instance, measure slavery and its impacts upon long term development. Divergent corporate free development in the spirit of the great theory, another great theorist, Erik Williams. We might look at the rates of mood of colonized populations or reaps genocides that were part and parcel of capital accumulation. And then our interpretation of these studies would also have to be quite different. Radically different, right? Because if we if we go with Rodney’s epistemological intervention, we would view states that build wealth through the organization and exercise of racial violence upon people that they racialized as inferior, both within their borders and around the world as underdeveloped. And then I think we would also have to rethink. What we should be aspiring to, what kind of world we want to live in. Rodney is one of the many black, anti-capitalist, anti-colonial, anti-imperial, anti-racist thinkers who understand and theorize this intertwined relationship between capitalism, racism, imperialism, exploitation and dispossession. Capitalist social relations are built on racialized exploitation and oppression. And even Dubois shares this revelation in 1940, where he says, had it not, had it not been for the race problem early thrust upon me and enveloping me, I should have probably been an unquestioning worshiper at the Shrine of the Social Order, an economic development into which I was born. But just that part of that order, which seemed to most of my fellows nearest perfect, seemed to be most inequitable and wrong. So these these scholar activists, these revolutionary thinkers, they envisioned a new world constructed to uphold racial and class equality and human dignity. Fanon, for example, argues that we must strive for a world that is free of the differentiations, the stratification, the bloodthirsty tensions fed by classes, racial hatreds, slavery, exploitation and above all, the bloodless genocide which consisted in the setting aside of 15,000 millions of men. Rodney gives us the tools for thinking about how we might conceptualize and study development differently. And I’m not saying in this talk that we should do more quantitative work or less historical work. Absolutely not. But I’m saying that this these are the dominant studies within development research that we see today. And what Rodney gives us is an epistemological intervention to be able to address these Eurocentric methods of conducting investigations and think about thinking about and moving towards development differently. Thank you.

Syeda Masood: Thank you, Zophia. This was really exciting and thought provoking. Now, I would ask Olivia to please start her 10 minutes.

Olivia Rutazibwa: This is really exciting. I also really wanted to meet you for a long time and the comments I want to make, it’s going to sound as if we like talk together before and then like find out how we were going to talk. So in a way it becomes really good. I’m so glad also that you spoke of Rodney because it’s a person I’ve been thinking a lot while preparing at this presentation, and so I will try to do three things in the 10 minutes I have. And the first one also refers to Rodney by way of introduction. I like to, you know, give a background, but also like explicitly ground, you know, the practice of grounding where we’re speaking from. Right. So I’ll be specific about where I think I’m speaking from. And obviously that does not necessarily apply to everyone. But I think it’s it’s good practice that we don’t always see no conscious approaches to developments. Secondly, I would like to maybe offer by way of building on what we just heard. Three ways to conceptualize what it might mean to invoke the Colonial when we try to engage. And again, I’ll give not necessarily definitions, but more instruments to think of what is it that we’re thinking about rather than making claims like, this is the only way that we should understand it? And then lastly, I would love to think through what are some of the implications if we were to engage in decolonizing development, if that’s at all possible. But, you know, even if we try and think about development in anti-racist and anti-colonial attempts, you know, so a bit I following also on Professor Edwards. So I think in the first sense, it might need to do a backgrounding. I would like to make explicit that I think or maybe the way that I would engage with it is to differentiate that the question of development as something. I decolonizing developments that might look different if you speak from a global northern perspective. And again, it’s not necessarily just literally, you know, as an individual possession of this, right? But as the conversation that we having within the walls of a global northern institutions and a lot of our universities throughout the world have been quite violently westernized. So I think in academia but also in in Texas. So on the one hand, what does it look like to think about development if we’re talking from the places that continue to benefit from colonialism in the present? And then I think additionally and that’s also again where we’re engaging with people like Rodney are just ourselves. There is maybe something about this conversation that comes to the fore, the sense of urgency we might have because we also speak from the diaspora, right. So I guess personally, this is what I would like to offer is both, you know, being quite explicit that I am not speaking from the Global South and I know the binaries a bit. It might sound artificial, but I think it’s just about being. I don’t know. There is so much in decolonizing discussions today that that that do not necessarily do that meaning that we continue from the global north to tell how the global such decolonize. I’m trying to make it clear that that but that’s something that and it will become clear why change and make it so explicit. It has to do with reparations. And I’ve had conversations with my friends and colleagues do one that they like. We don’t have time for that. We’re doing something else. And it made me realize that, yeah, we might we don’t all have to have the same conversation at the same time, but we can talk to each other, obviously. On a more personal note, I think if I had to background what where I’m speaking from is this fascination with global solidarities? In general and how they do reproduce commonality in the many ways that we’ve already heard. For me specifically, it was trying to make sense as a second generation in London of the discrepancy between the discourses around development and aid and assistance and interventions and everything. And the reality, in my case specifically of the genocide in 94, where you have an international community that just disappears. And I guess it took me a long time to understand that it’s not just about making sure that our practices met better onto more systematically onto the discourses that, you know, again, the Global North has about its own solidarities, but it’s actually about naturalizing those discourses. And again, as Sophia said, there’s a lot of deep hierarchies, racists, fundaments that continue to be reproduced in that right. Like this, this mythology of, you know, the West having the moral high ground when it comes to human rights and, you know, where all these things have been invented, all of that. And again, I guess if we ask explicitly, we will tell yourself, no, no, but we have to nuance it. But a lot of the logic of how international aid is organized has a reproduction of this moral, technical, political, all these hype grounds that the moment you just scratch the surface of history, it just it just implodes. Right. So I guess that that’s where for me very specifically, decolonial or decolonizing comes in. But it also makes me be that I might be speaking more about development aid in this context and development policy. And again, we’ll see what that means. So secondly, I have to think of various ways that might be useful for us. It’s what I think about in engaging the Colonial. And the first one is to try and engage with something to do with time, I guess. But it’s also the concept bites us as if you mentioned colonial rule, which makes it sound, you know, quite technical or whatever. And so we don’t have to engage with all the other stuff that comes with it. But the other division that we often hear within our discourse is it’s a differentiation that is made in the colonial science between colonialism as a historical moment, as a formal form of governance. You know, we can think about it as flag planting. You know, you come to a place declared yours, put your flag, and then take over governance. And of that, often the reaction would be like, yeah, no, we beyond that, you know, that has passed, you know, the successful decolonization processes apart from the fact that we still have the settler colonial countries of the U.S., New Zealand, Australia, Palestine and others. So there’s a lot to be said about even that discourse to think that we’ve moved beyond the formal colonization of places and peoples. We haven’t. But let’s say that it’s also, I guess, not really salient to pretend that the sixties didn’t happen. So a lot of successful struggles took place. So the colonialism, on the one hand as the moment, but then the contribution for me from the colonial side is the concept of coloniality, where they actually try to say that regardless almost of where it happened, when it happened, whether it’s and by whom, it’s about trying to point at extreme power inequalities and all the institutions we have in place. To perpetuate those. Right. And I think those that distinction allows us to, you know, quickly snap out of this idea that it’s in the past. What are you on about? You know, we’re thinking about the present, especially development has a lot of presentism in it. Another way to make a distinction or not to conceptualize is the point immediately and not at the successful modes of governance, whatever, but the colonial. It’s a system of destruction. It just it just is it’s been always part of deeply destructive forces, destruction and extraction and within destruction. That’s distinctions that are made from decolonial thinkers is one that points up the destruction of bodies, you know, genocides as genocide, not necessarily as a legal concept, but as, you know, disposability of certain peoples, but the destruction also of ways of thinking and philosophies, languages, whatever. And so they call that epistemic rights. And how that also goes hand in hand with the systematic destructions of life environments, ecocide. And so if we take these three together, then again, we won’t waste time in. Was there also something positive about colonialism? We literally don’t have time, I think, to have to have that. And lastly, I think it’s important, especially with development cooperation, thinking that the colonial always has been an imposition as well, an imposition of one way of being, understanding, knowing, doing that is then declared as a universal one to go for. And development obviously also is very, very much at the center of that. So that invites us to actually think about the extent to which if we want to decolonize anything, it’s not just about what can we do more efficiently, but also what do we have to stop doing. So in a one minute that I have less about the implications that I’m sure that a lot will come in, in, in the Q&A, maybe following on on the third point I made about the Colonial as an imposition, I think it invites us to think about abolition and not just reform of development or whatever, but there is something about especially development. It’s especially if we call it AIDS after the whole colonial thing that it just becomes quite obscene to call it. You cannot help someone after you’ve left the lines, because then you would have to turn around and speak about repair reparations, which would entail a deep and dislocation of power. And the other one would be to prescribe development and then more development in terms of how what Rodney thought of it, because and I’m paraphrasing, but for him, development has something to do with people’s ability to adapt themselves to their life environments in the best of ways that can be done in many different ways. So that’s also one of the things that I take from his. So it would involve, I think, re inscribing the project of development at the service of life, which is not always the case for all the reasons that have been summed up, but also maybe engage in some sort of see where this homogenizing process, where it’s okay from what you tend to think for the rest of the world, how this should develop is quite problematic. And also following on what Sophia was saying, it also requires us to reengage with the question of capitalism as capitalism as a force of death and destruction. It’s quite important. And then I think lastly, to come back to the time frame, it also invites us to really actively fight against colonial amnesia, pretending that stuff didn’t happen and also white innocence. And what’s here is a wider category than phenotype. But there is such a strong desire for innocence that is reproduced through development AIDS that I don’t think we can sustain in the long run. So yeah, 11 minutes I’m going to stop here, but I’m very much looking forward to the questions that might come our way. Thank you very much.

Syeda Masood: Fantastic. Thank you both for these thought provoking starting comments. And now what I was thinking, actually, what I tried to do is to have an academic who thinks from a positive, positive perspective on these questions. But somehow that wouldn’t happen in the time that we were able to be here. So I am actually wearing my hat as a development practitioner from, you know, pre PhD days and asking some, some questions from both of you guys who are like working in a paradigm which is actually quite different from how development was, was taught to me at least. And many of my very well-meaning and lovely friends still work in the development sector. So they also asked me some some of these questions when I wanted to have similar discussions with them. So first of all, I so I’m starting the 15 minute clock now. So my first question is like if a well-meaning person works in, for example, the World Bank and the minister of an African nation, for example, Sierra Leone, for example, asks them not just ask them, but begs him for money, for education, for for his country. Why what he is doing is bad. Isn’t that what he is doing is actually something very good because apparently, like the minister who represents an African country, wants money pretty badly. What what are your thoughts about it?

Olivia Rutazibwa: So yeah. The practical questions, they’re always the most challenging one again, I think, and it’s not a cop out, but I want to say it and then move on from that. But I think it’s quite important that we would be more specific on who’s answering this question because there is not, you know, but so if I happened to answer it, first of all, I would invite that minister of Sierra Leone to refrain from begging. But he could formulated as as prepare reparations. I mean, and again, that’s something that cannot be looked at as an individual question or whatever. But, you know, there is something to be said that if the the money that is being requested is money that you ask back, or whether it’s money that it depends on the goodwill of the person on the other side of the table and make it more concrete, I think. And I’ll give the example of run it because I know it best. And after after the genocide, they. They realized, I guess, that they can’t really count on the international community on the one hand, but on the other hand, also, they felt that there was no reason not to take the international community’s money for the rebuilding. It’s a very pragmatic approach to it. And what they did at some point was to say, listen, we have so many donors. You guys are all over the place. You know, even though we have like the Paris Agreement and all these different, you know, efficiency rules, it doesn’t, you know. So building on that in those agreements, they said we will reshuffle it. And I don’t remember the details, but let’s say that Belgium for the longest time was giving a lot of money in terms of small agricultural projects. And maybe the World Bank was giving money for health care in the country. They said, we want to streamline it so everybody can stay around the table. But Belgium, from now on, you guys will invest in health care and we’ll take care of our own organizing of of agriculture and World Bank. You guys can give bigger sums for more general projects. Again, within the country, there’s probably a lot of also ideological differences that people might have. But what is important, I think, in this example is that it’s not outsiders that will distribute the money or decide how it’s going to go. Right. And so for for a lot of the people and run the government for them, it was more like it’s literally not their business. They have a duty to give us money and then we’ll we’ll sort it out. And it had a big backlash and a lot of at the very short term, a lot of this small farmers that were building their their businesses with Belgium Project Money, they saw that they they left change rights like in a negative way, maybe in the short term and also a lot of Belgian NGOs. Started being like really upset because a lot of the money goes to them from the government but to governments to run it. So, so basically this whole reshuffling did not make that many people happy in the short term. But that would be my answer to that. It’s it’s about we have to dislocate the power. And part of the power is agenda setting. But it does not mean that that the duty to at least redistribute some of the money that keep on stealing from the people or not, that does not dissipate when we say we pay or when we say stop doing this or when we say abolition. Right. And so that’s why the historical and the present, I think, really, really comes together. It also explains why it doesn’t really often happen. And that’s why I think it’s more important to think about development through abolition and trying to reform it because we’ve reformed it a billion times. It’s not that people within development sector have not thought of of reform. Right. Very long answer. I’m so sorry. But yeah, that’s that’s that would be my first reaction.

Syeda Masood: Oh, fantastic. What, what are your thoughts Zophia of this?

Zophia Edwards: Yeah, I mean, I agree with that 100%. I mean, I think that there is the practical element to this. And of course, you know, we we have I’m thinking specifically of the Caribbean Commission right now that is trying to push for reparations and that, you know, reparations for slavery and genocide and dispossession. And I think it is is really important what one piece of this that’s really important is exactly that question of how that reparations then gets distributed. If they get reparations, how it will be distributed and distributed, and who will control that process and what is the vision. So, for instance, there are different articulations of sorts of what what do you do with reparations? The American Descendants of Slaves group has a different articulation from the Caribbean community. So so you know, how that gets distributed is, is, is a very important question and where are the people, the masses, voices and that. And then the second piece of this is I think often times this gets seen as an either or, you know, either you ask for reparations or you maintain the same situation that you have now. And I think that. You know, there is no there’s nothing precluding I don’t think it precludes still organizing towards radical change and radical transformation. So in that sense, you know, I don’t see those things as being in conflict. I do see the problem with the with with begin. Right. Because that’s incredibly problematic. But in terms of seeking justice through reparations and through transformation, I think those are still sort of consistent with with with radically changing things.

Syeda Masood: Fantastic. My other question was about the field of development economics, which is quite a strong field in agenda setting, field in development studies and broadly speaking, development economics teaches people how countries of the Global South can somehow become countries as rich as countries of the global north. And what are the different? Like, things that they can do. Maybe they have like, quote unquote, weak institutions or governance, or maybe they don’t have enough industrialization. But my question is like, did Europe and its settler colonies develop because they did something particular and whether it can be replicated by countries of the Global South?

Zophia Edwards Well, I’ll I’ll answer briefly. And I think that, you know, this is, again, why history is so important, and which is why I wanted to make the point that I’m not advocating for sort of more number crunching because history is so important. And I think this is what’s severely missing from sort of the development economics fields. And, you know, a lot talked about much of development studies in general is it’s so ahistorical that we don’t you know, you cannot recommend in 2020 to a path that, you know, to follow some sort of western path when so many of the things that European countries did to accumulate that wealth had just no longer legitimate in the eyes of I mean, for people who have been racialized and colonized, it was never legitimate. But they now see it as white people. Also somewhat some some some of them see it also as illegitimate. And so it’s not the same world historical context and that. And so I find that whole thing, the whole sort of prescribing a model based on a completely different historical context to be incredibly problematic in that sense. And then secondly, you know, again, coming back to Walter, Rodney’s sort of definition of development, is that even what we want to look like? Right. You know, maybe we don’t want rampant poverty caused by inequality and capitalism. So I think that, you know, these recommendations, these sorts of prescriptions are really coming from an imperial lens and an imperial position and is perpetuating the same problems that know puts us here in the first place.

Olivia Rutazibwa: Yeah, I agree. And that and I’m not going to pretend that I’m an economist by any shape or form, but I think what what I meant would we need to be more explicit in reckoning with the capitalist system that is presented to most of us? Again, if you study in a Westernized university, it’s like just really difficult also to come up with an alternative because then people say, oh, but communism. And that didn’t work either. Right? And that’s that’s the end of the imagination. So I’m not even going to go there. But I think what again, engaging the Colonial shows this. Is that we have to stop fragmentation. The fragmentation of world history. Right. And so, again, how the good in the literature doesn’t really matter, but there is this and kind of I think started doing it where we never speak about modernity in isolation, it’s always modernity slash coloniality. And I think that’s quite helpful also for development economics, for economic studies in general. And I don’t maybe we should stop teaching development economics separately as if we have to study poverty on the one hand, completely detached from how we we study or teach wealth. And so once you do that. Then it is just becomes really difficult to advocate for capitalism as a superior model. That because is literally one that advocates for wealth accumulation which you know, if it were successful, maybe were not against it. But most of it has been done by not paying for whatever labor that care. You know, so it’s such a faulty system that by definition it will never. So the mythology about capitalism is that it potentially creates the most wealth for the most modern people is simply a lie. I don’t even have to be an economist for that is the other way around. It’s really the concentration of wealth in really small hands, in big hands of a small group of people. And I guess there is a special issue that came out. I can I can look it up later and I’m very bad at remembering names, but that’s one example that really helped me out understanding it. I think one of the starting stories in many economics handbooks of macroeconomics introduction is this whole story of Robinson Crusoe on his island. And, you know, this individual that, you know, with his own bare hands, whatever managed to do. And it’s this whole idea of the rational man making rational choices. But then you have this other character of Friday who basically probably did all the work and you write them out, both of the mythology, but also very much on how you teach rational ties within economic models, whatever. So, so, so focusing on the economic and the colonial just produces of science. So it’s not even about just social justice or whatever. It’s like you cut out two side of the story and then you try to reproduce whatever mythological version of it. And then after 60 years you wonder, why is it not working? So I don’t know. That would be again, my short answer to that. But it’s an important question, especially for those disciplines that look as if we can just teach them in positive, straightforward ways with its own laws and whatever I would say, history. But also maybe we have to introduce much more politics as well within that. And I don’t mean party politics, but maybe ideological choices and explore other options. And they do exist. And that’s why I mentioned the reversal. But we we have systematically written them out of our handbooks.

Syeda Masood: Yeah, actually, I remember I did my undergraduate in Pakistan and I remember we studied economics. The book was actually written by an American, and in the first few pages it talked about how economics is not a normative discipline, that it’s a positive discipline. So these questions of what is right and what is wrong, I actually found it as a student of economics. I found those questions, quite stupid questions to ask even from my professors. And actually it was quite eye opening that in the other discipline that I am in now in sociology, there are consideration of ethics and it’s not a stupid question to ask if something is is good or bad or like hurts people or something like that. So let’s open the panel to we have 15 minutes left to the Q&A. And I will first ask the question that Orlando Coronado Fernandez asked. He said, Greetings, everyone, and thank you for your lecture. I would like to ask about the role of colonial institutions which which are the richest the government left behind from colonialism in development.

Olivia Rutazibwa: Maybe. Maybe more than. Yeah, it’s a difficult question to answer. So I think on the one hand we can think of it not necessarily as just very particular institutions that are by definition colonial. What might be most colonial about them is the fact that we have ended up with a state structure or systems of governance. That presented as the only way to organize your life or to organize power or to organize. So when in development, we promote liberal market democracy and we don’t even call it that, we just call it, you know, democratization or whatever. And it, again, is presented as this neutral, whatever thing. And I would say that that that is the problem. The other problem is that it’s also. Systems of governance that often have very little to do with the people concerned. And with that, I’m not saying that people today are to not desire democracy. They always have. But again, that’s a particular type of it. It has grown out from a particular situated ness in, let’s say, Western development of their own states, which were never national states. They were always empires to begin with. So that’s already a very that there is at least a connection between. Governance and those that govern and the people. And so that was copy paste it into situations. Where if you look at the formalistic things of doing elections or whatever, but the whole global system makes it such that even politicians with the best of intentions in many places, in actual fact, they’re first and foremost accountable to outsiders. And there’s no amount of elections that will change that. So I think that that those are really important things to think about because when we again, also many students like we’re interested in Africa, what, oh, we’re going to study corruption. And then the corruption is completely a historic like a historically approached as in for some medical reason, people in Africa are more corrupt as well. So part from being deeply racist as a reflection often again we don’t study it and we place it in a prison and a very technically we’re going to train people to be less corrupt, whatever. And I guess lastly importantly to understand that both the economy. And the political organization. That emotion during colonial times was always for the benefit of the outside. It was never for at the service of life of the people concerned. And I think the post-colonial moment has not been able to transform those institutions into something that that would reverse that, because even the creation of these countries was never about the people. So, yeah, I just spoke about the political institutions, but that that would be my.

Zophia Edwards: Yeah, absolutely. I mean, this reminds me of I’ve been rereading Fanon Fanon’s chapter on the pitfalls of national consciousness in Wretched of the Earth. And I think, you know, it still rings so true to me that these institutions have been, you know, they basically serve foreign interests. And so and they have been set up and designed that way. And so when we talk about decolonizing the state, what does that really mean when the people who occupy the positions of power within the. Now independent states are still oriented towards the Metropole, still oriented towards capital accumulation themselves and for foreign investors. I think, you know, this this kind of speaks to sort of just the inherent weaknesses of being able to to create to create something different. However, I think it’s obviously not impossible because mass movements can push those states to alter the organization of those states. And I think in this. Particular. Historical moment. It’s so necessary now. It’s sort of urgent because we’re seeing very, very clearly how neoliberalism has just exacerbated so many of these. Problems that the newly independent states just would not set up to deal with them. And I see the problems, I mean, for the people, for for working people. And so these institutions have to just go back to what Olivia was saying, and we can’t really reform them. We can’t really reform them. We just have to have something new. Yeah.

Syeda Masood: Thank you both. Sophie Gardiner asks What three scholars broadly defined would you recommend reading to learn more about neocolonialism today?

Zophia Edwards: Well, I will just say that the ones who I just you know, Frantz Fanon, I think is timeless. He should definitely be read. Kwame Nkrumah, equally timeless and continues to you know, you continue to see the operation of those mechanisms that they lay out so clearly in their work on the neo colonialism.

Olivia Rutazibwa: Yeah. As I said, I’m really bad with names if I’m thinking of something contemporary. And that’s maybe specifically already in the state building literature. A book of a colleague of mine called Decolonizing Interventions by Mira Subrahmanyam really allowed, you know, goes back to some of this more fundamental literatures, obviously, but really applies it to the case of Mozambique. And, you know, really, really amazing and very practical, useful way of thinking. So she did fieldwork and just ask people like, how did you feel this whole and there’s a lot of neo colonialism that that shines through that another way. And that’s maybe not a name, but I would actually want to draw maybe people’s attention to conversations that are ongoing in West Africa around this concept. So the currency there, which is still pegged to the euro through the French banks, and that’s a very concrete, tangible way of for us to think about. And I’ll put it in a chat to think about these neocolonialism we’re talking about is not just in people’s minds because, you know, there is still colonization of the minds, obviously, that continues, but it’s also very much in you know, I think it lowered it a little bit, but at least 60 or 70% of the reserves of the countries that are part of are in French banks. Right. So when people say that France would not be anything without its colonies, it’s very much in the present. So that that would be something else I’m thinking about. And I think, you know, not seen as a scholar often, but the late president of Burkina Faso, Thomas Sankara, he is a lot of his speeches are around. He had such a really sharp understanding of imperialism and colonialism. He was obviously assassinated. So that there are specific differences. He he has one of this the thing that he said, like, don’t go and look further. If you want to understand what imperialism is and your colonialism, if you just look in your Bill of Rights, that’s where it’s located. So again, connecting very much the production of food, the control of it had a lot to say about development aid, but also very much about dependency that he he wanted to to break. So that would be another person I would I would point you towards. But after this call, I’d be like, oh, no, I should have said this really by witness. But those are the same and obviously everything that the US and I would. Yeah. Hundred percent. Thank you.

Syeda Masood: Yeah. Thank you both. Olivia, can you. If you have a chance to write the name of the president of Burkina Faso in the chat? Because I did not get that. Thank you. Oh, great. I would also say, Anibal Quijano, it’s important to understand, Coloniality, because you know how we think of colonialism as something in the past and how it has nothing to do with the present is is something that he talks about quite well. Okay. So on that Adhikari asks, How should we view the role of private consultancies? Example McKinsey, Deloitte, KPMG at all that embed themselves in government departments in many post-colonial countries where they co-create new forms of exclusion, which is not imposition while doing development within a larger framework of racialised colonialism.

Olivia Rutazibwa: I mean, I would include them in my call to. For abolition, as in I see them as part and parcel of those that the institutions of international cooperation are a multilayered right in different states, not just state to state, whatever. So for me, they’re just one of those actors there. The thing is that they’re very. They’re most explicitly linked to the to to the to the capitalist accumulation logic or the neoliberal understanding of what development should look like, but also how that that translates politically. So I would say that it’s really important to study them in detail. I mean, I would have the skills, but so when I say abolition doesn’t necessarily mean dismiss and pretend it doesn’t exist. But as a question, I think it’s quite important for us to unpack what is this? This is this beast that is international cooperation, right? Or the global system or whatever. And they’re very powerful actors within that. And it might also help to historic size this. Right, because when, you know, we did the flag planting and I say we and it’s really messing with my mind when I say so. But, you know, again, look at how it started. But it was not just our means that way and it was not just the brief. It was not just the teachers, it was not just it was engineers. It was like. So all these different actors have always been around and they’ve always been part of the same story. The problem is that the missionaries were the benevolent face of the colonial enterprise. Right. And I think, again, it helps too, because it’s so clear that the missionaries messed up. Right. And in the present, we have no problem, you know, shooting on them. It’s just really important to understand that the same logics are reproduced, but they have very different faces and those actors are part of that, I would say.

Zophia Edwards: Yeah, absolutely. And I think that that is also a related interesting question to ask of these companies is sort of how, you know, why do. These governments call upon them, right? Why did they bring them in? And what are the whole processes there? Because, you know, this question of whether or not it’s an imposition, I think is an interesting one, because it brings up sort of what do we mean by collusion and how this collusion actually operates on the ground. And I think that that’s a really important question when it comes to these companies that seemingly act as if, you know, they aren’t being cohesive. But then what does it mean to get a bad rating from McKinsey? Right. And what does that mean for those those economies? So, yeah, I would I would also put that into sort of what would need to be considered as part of the doing development work. Yeah.

Syeda Masood: Thank you. So we’re almost out of time. But let’s squeeze in one more question. An anonymous attendee asks, In your opinion, what kind of research can students do to contribute with the dialog and efforts of decolonizing development?

Zophia Edwards: This is a big question. This is that I feel like this is a big question because the field is so vast and what people study can be a lot of different things. But I think. What we can what we can really bring together. As sort of important themes in the study of whatever field it is we’re in or whatever research we’re doing, is sort of these larger questions of, again, re centering colonialism and coloniality in any study because it’s so central to my identity and we really cannot divorce our understandings of the contemporary period with, you know, from from that violence and those structures. And so I would say that’s one thing. Another thing to do is to. Think about the elevation of the voices of the people, working people, laboring people who are often marginalized in the work that we in the work that sort of people who are doing work on development even forget like, you know, those people. And so I think that’s another important element in any kind of topic that we are studying is to really think about, well, what’s, what do the people want and what are their visions and what are their articulations for the kind of world that they want to live in. And so I would just put those two pieces, those two pieces there.

Olivia Rutazibwa: You know, I think it is it is a really important question. And I’ve been I’ve been teaching international development for eight years, and and I’ve tried to find ways to move away from it. I ended up in sociology. I’m not even a physiologist that explains that, but I’m teaching human rights now and it’s very adjacent. So it didn’t really solve the problem, but while I was teaching it. I guess one way to think about it is that whatever you want to study. Be explicit about the purpose of your interests and a lot of the desires that come with wanting to engage with development. You know, they can be career, whatever that is. There’s not a problem in and of itself. But a lot of. Mastery hierarchy erases what is reproduced within the development system. And a lot of our research questions reproduce that as well. So if you can already like try and be very explicit in study anything like, you know that we talked about before, you can actually have a decolonial projects that studies them in detail. So that research might not look very different from from the outset, whatever. Right. But rather than just take them at face value in the presence, as, you know, surveying what they do when they do it, whatever. But like, what would our research projects look like if you put it at the service of life versus at the service of power? I’m not even talking depth, but you know the flipside. But so the will to life versus the will to power, I think it’s about mastery. Right. And so one thing to work for the UN is always a combined desire of both having an exciting job with exciting people, whatever, which is fine in and of itself. But the reason why my students would opt for the UN rather than a bank is because they do think that it is attached to positive change in the world. So if you want to commit to that, there are places where you need to think that you need to research on purposes that you put into it, that just it just doesn’t happen to it anymore. It doesn’t. And it doesn’t make you a bad person if you do. So you can still decide to study or work in those places. But then you do it as at field work and study how power works. Would be like be explicit about how power appears in your research. That would be its fate, but it would be very important. And the other one, in terms of historic sizing, I would say it’s important to ask yourself the question, where do I start the story of whatever I’m studying? And so when I was teaching international development as well, our general course is one on one. They would start with, I don’t know, modernization theory on way in fifties, as if there was nothing else before. I change that process by having students to read first me civil discourse of colonialism. You just start somewhere else. You don’t, you don’t what? What does it do if in your in the beginning of your story, you take the time to understand where this poverty comes from, rather than just accepting it as today’s value and then technically wanting to study that. So I know what makes the teaching and the research, but often obviously it goes hand in hand. But yeah, that’s what I would say to you.

Syeda Masood: Okay. Well, this has been a very exciting and interesting conversation and time has just flown by. We are at the end of our discussion, and I would thank both Zophia and Olivia for this, for their time, for their thoughts, and for the fantastic work that they’re doing. And I’m very looking forward to reading more from you as you as you write more about these topics. Yes.

Olivia Rutazibwa: So thank you so much for having us.

Zophia Edwards: Thank you so much. Thank you.

DISCLAIMER: This webinar transcript was loosely edited and there may be inaccuracies. 

Tim Freeman: As a quick introduction. My name is Tim Freeman. I’m a fellow at the Growth Lab and a return Peace Corps volunteer. I’ll be moderating today’s session titled Community Engagement as a Front Line to National Development. The Peace Corps Experience. This event is especially timely, as just last month, the first volunteers returned to the field after a two-year hiatus. Most importantly, we are excited to have with us today Dr. Jody Olsen, former director of the Peace Corps. Dr. Olson began her career as a Peace Corps volunteer, having served in Tunisia. She has since served the agency in multiple leader leadership positions, culminating in leading the agency as director from 2017 to 2021. Prior to heading the agency, Jody served as a visiting professor at the University of Maryland, Baltimore School of Social Work, and director of the University’s Center for Global Education Initiatives. She earned her Ph.D. in social work from the University of Maryland. Jody is currently a spring 2022 resident fellow at the Institute of Politics Security Space. Jody is a lifelong champion of service, learning, and international opportunities for Americans of all backgrounds. Jody, it is very fitting that we head here today at the Kennedy School, considering it was 60 years ago that JFK himself founded the Peace Corps. For those of us who are less familiar with the Peace Corps, could you explain what the original purpose of the agency was and how that purpose has evolved throughout the decades?

Dr. Jody Olsen: Thank you. And it’s a real honor to be here. Thank you so much for inviting me. As Tim said, I love this work and I love Peace Corps. And you’re going to hear that term once or twice over the next little while, if not a few more times. But to begin, it was March. It was the fall of October 14th of 1960, when President then-candidate Kennedy gave those initial words that ultimately led to the Peace Corps. In that first year, it was about working with communities all over the world, and there was a lot of resistance in the beginning. You can’t send young Americans, you can’t send women. They don’t want us. What water? How is Peace Corps different than other development agencies? Well, the difference was shown in August of 1961, when about 25 Peace Corps volunteers got off the plane for Ghana, the very first Peace Corps volunteers ever. They came down the stairway from the Pan Am flight and started singing the Indian national anthem. It made headlines around the world that said, UPS, this is something different. This is good. This is something we want more of. Because already they had said, we are part of a community. We are part of a nation. We are part of that nation’s language. In the beginning, and I’ll refer to this a few more times, that initial legislation of September 1961 had three goals and a mission statement. The mission statement was world peace and friendship. We’re still working on that. The three goals which are equal and intertwined, and that’s the key to these three goals. The first is to help train men and women and other countries that ask for that support. The second goal is share who we are as Americans. And that’s very important that the word has American. It has an end on the end because we share who we are as individuals. We’re not sharing America. We’re sharing us as Americans in that community. And third, equal and integrate integrated is we share that experience back with Americans, both while we’re there and when we return, so that we are both. We are combining something that we talk about development, which has a technical role. But we’re saying with that it’s the human interaction that makes the technical be able to happen, and it’s the technical that helps give us that extra trust for the human interaction that keeps our relationship strong. Four years later, what has amazed me because I’ve been lucky enough to serve in every decade of Peace Corps. So I’ve been around a while that. Seen it change. And the most significant change for Peace Corps has been the introduction of communication, the electronic communication that started hesitantly and started with those first Nokia cell phones that had the little flashlight on the end and have moved to every form of instant communication and social media we have now. What’s been interesting over that particular change, because it does affect how the volunteers interact in the communities and how they interact back home significantly. It has not changed the core of what Peace Corps is and what Peace Corps does. And importantly, it does not change that integrated quality of that Peace Corps volunteer in with their host family, with their counterparts, with their communities, with their schools, with their health clinics. That does not change. That has not changed. That will never change.

Tim Freeman: Very interesting. And I’d like to take advantage of the fact that you’ve actually spoken with the  leaders of countries where Peace Corps is hosted. What do these leaders say about Peace Corps and more zoomed in? What do the community members think of the Americans who join them for two years?

Dr. Jody Olsen: Let’s start with the leaders and the. Just a couple of examples. When I was in Sierra Leone for the swearing in of the new Sierra Leonean president about three and a half, four years ago, and I was representing the administration and I was supposed to be very official and do those official things. Well, when he and I met after he was dancing, getting ready for the swearing in the next day, he said, Oh, in addition to being the formal representative, you’re the Peace Corps director, aren’t you? And I said yes immediately. 30 minutes of. Well, let me tell you about my Peace Corps volunteer. Let me tell you about what happened to me in that classroom. Let me tell you about the confidence that volunteer gift gave me. Let me tell you about why I am here now. Because of that, I talked to the Prime Minister of North Macedonia in 218, and when he was mayor of the capital city, he said, I had three Peace Corps volunteers working for me. We’re still best friends. They taught me management. They interacted. They gave me courage. They gave me that opportunity to really understand who I was to now lead this country. The national leaders also talk about seeing the impact at the community level. And so when I have visited hundreds of communities, I have talked to host families, I have talked to counterparts and I have talked to the students and help leaders. It’s like, wow, this person is here with me every day. This person and I, this Peace Corps volunteer, we talk every day. We test ideas. We we try to see what these ideas might be. So I try my ideas out with a volunteer and the volunteer might try his ideas out with me. And together we figure these elements out. When we looked at and did a survey, not we, but the Dominican Republic students as part of a class looked at about 85 different communities where Peace Corps volunteers had served. And there was one word that came out way beyond any others. In fact, about 80% of all the respondents used this one word, and I don’t speak a word of Spanish, so I’ll have to give it to you in English. But Spark is the English word, and I understand in Spanish it’s a much stronger word. And at first, when we in Washington got the results was what? Is that how communities? Is that how families? Is that how counterparts see Peace Corps volunteers? And then as we thought about it, we realized that’s exactly what this is about. It is about the spark. It is about the energy. It is about the conversation. Is it about the excitement? It is about the trust that the communities give because the volunteers give to their community and they see it as that spark for them to be better at what they’re choosing to be.

Tim Freeman: I’d like to transition now into the development model of the Peace Corps, which you just hinted at. The agency is so tied into the American ethos. It’s a true cultural touchstone. But oddly enough, the actual development aspect is often overlooked because of that. What is the Peace Corps development model and how does it tie into the organizational structure of each volunteer living side by side with the community?

Dr. Jody Olsen: Good question. Let me open it by saying it reinforces those three integrated goals. Because our development strategy, if we might use that word, is really dependent and interdependent on the trust that we establish and the community base to any of the work that we’re doing. What’s been interesting and one of the changes over the six decades of Peace Corps is our ability to look at these models, these development models at the community level and actually now begin to measure them. Now, I might note that initially when we were talking about measurement about 15 years ago, I, who have a doctorate in a measurement degree, was very nervous about measuring. Partly because I’m about stories, as you can tell already, and about what the human action interaction is. And if we turn it to data, are we going to lose what a lot of it is about? So but what’s very exciting is that we are we use two models and they’re both for public use. They’re on the public-facing side of the website for Peace Corps. The first is the participatory analysis for community development, better known as Pocha. And the Pocha model is about how we help people help themselves. And so the Parkar model is, as you go into a community, it has a potential opportunity to do community mapping. How do different community members see their own community? Where do they spend time? Who do they turn to? How far away do they walk or drive and what do they want and what do they need? There’s a whole method for that conversation that can take place even over a day or over two days. And what do different parts of the community see about? One spends all his time in the schoolyard. Another spends all her time doing vegetable gardening. What is it that they then look at in terms of what they want and need as to how they see the community? Community walks where you’re walking around, talking. Sharing in the local language. These kinds of activities who are informal leaders. How do you talk with informal leaders? How do you share with informal leaders? They begin to pull together an understanding of that community from the health perspective or the ag perspective or the education perspective, whichever perspective that volunteer is going to be working with. And that is the grounding for the work the Peace Corps. Peace Corps does. That is the grounding for the agricultural volunteer that is going to be working with farmers on dry season crops that haven’t been introduced yet. Then we turn to what is the Logic Project framework, and I’m sure many of you will probably recited in your sleep, but it’s about the input, the activity, the output, the short-term outcome and the long-term outcome. So as we begin this work. You don’t base on having built that trust and the conversations we will do. For example, following the logic project framework is volunteer is working with a group of women in Senegal and they are looking at their spinach production, which is now being enhanced by another project. And they want to save the spinach for the dry season. And safe driving spinach is what I mean is to dry the spinach and set up a program where they can be a little NGO that sells spinach during the dry season. All right. So the volunteer who’s working with them and she use the Packer methodology to be with them and for them to say this is something we really want to do and talk about how they can do it. She then and we now have the software tools, software tools, MENA phone, and in a few cases we even have had that with the counterpart. So this is the chair of the NGO. For example, she and the volunteers sit down together and together they say, you know, how much spinach do you think we can sell? Or it might be, you know, how many women do we think are going to participate? So they begin to write down what they would like to happen. And then they write down and this is what we will need to do, and this is the activity. And then you begin to see what happens. How many people came to the meeting so the volunteer and her counterpart are together. Writing this down. Writing means putting notes in a hat or on a phone and looking at that and the counterpart is going, Oh my heavens, we had three more women come than we thought of before. We now can reach out to three more women. This is the counterpart saying this, understanding this because they work together and the Peace Corps volunteer now as we have moved into these last few years, can even print it out. And the counterpart puts it up on the wall and says, look at the progress we’re making. Then just to carry it along, the Peace Corps volunteer puts the data, it goes to the capital city and then from the capital city it comes in to Washington. And so we get the data on these various projects from different parts of the world. Those data, which are more the input activity and output and short term outcome, move on to depending on the project, the malaria the President’s Malaria Initiative or PEPFAR or CDC projects so that those other agencies are involved with the national data. Working at the national level that they can pull up and say, Oh, my heavens, look at this bed net project over here in this small section of Senegal. We now see at a national level that the malaria has been reduced, the cases of malaria have been reduced. We at Peace Corps don’t know that. That’s not our responsibility. Ours is in that community. But the good news is, particularly with the electronics, we now have a place to put it which excites the community about the roles that they play. So it is these two models, one that brings us in. In integrates the sense of the community. The other is the measurement with the counterpart to the activity that’s happening.

Tim Freeman: I’m hearing. Ghana. The Dominican Republic. Tunisia. Mountains. Coasts. Desert. Cities. Villages. Towns. Peace Corps operates in every diverse region imaginable. How does the Peace Corps model function in such different environments? And what have been the limitations?

Dr. Jody Olsen: Let me start with the limitations. The limitations are safety and security. And so a country for us to participate in a country. The, again, the head of the government, the leadership of the government has to invite us. We are invited. The government leadership determines what kind of projects we’re going to do or what areas we’re going to work, whether it’s agriculture, education, etc. That is key. And so if a country doesn’t invite us, we’re not going to be there. Now. Secondly, the volunteers, because we integrate into the community and we live with host families and we work with counterparts and we’re in those community groupings that community needs to be safe enough for us to be there because we use the integrated model of safety and security, and it works really well. As long as there’s reasonable stability in the country is when you have outsiders coming into a community that it becomes unpredictable on the safety and security side. And so we cannot be in communities or countries where there is a serious safety and security issue. So that’s the restrictions now on the development side. As Tim said, we can be almost anywhere we can be at. You were at 13,000 feet in Peru and you had a fun time with height. We can be at the other end of Peru, down in the Amazon, we can be. The variety of the settings don’t matter. Part of it is whether, you know, whatever religions of the world, whatever geography of the world, cultural histories and traditions. As you heard from the framework that I was describing, we’re about a process. We’re about, how do you go into the community so it doesn’t matter what kind of a community it is. It’s that process of going into the community once we’re invited and it makes it possible to be in such extraordinarily different places. When I was in Kazakhstan for five weeks as acting country director, I was there when it was -30, and volunteers really had lovely examples of how close they got to their host family when it was minus three, and yet they were still doing their community work and it can be 110 and it can be windy and it can be a whole host of things that are models or process models that can be adapted to whatever cultural or environment we are in.

Tim Freeman: So, Jody, I’d like to give you the chance to respond to some criticism of the Peace Corps, because Peace Corps is like like any program in the development space. It is and should be criticized. And the main point of criticism is the modern-day relevance. The first goal, as you mentioned, of helping countries in meeting their need for trained men and women. That was a clear value added in 1961. But it’s the year 2022. Internet penetration is global. Anyone can access any information at a moment’s notice. Many countries, including in the developing world, have robust educational systems, including at the university level. How has the value add of American college graduates serving abroad shifted?

Dr. Jody Olsen: Let me give a couple of examples and then I’m going to come back and report and restate what? Primary purpose is, which is important now also. But a couple of examples. When I was meeting with the ambassador from Mongolia, this was about four and a half years ago. COVID stopped everything. Two years ago. So everything is a reference to at least two years ago. So when I was meeting with the ambassador from Mongolia, he said, this is what we really would like volunteers to do now, as soon as possible, as soon as we can get it, we would like more of you. It’s possible that we have people all over the country. Mongolia is huge because very cold in the winter. It’s very hard to get around. We also know that English. We also know that some basic education is critical. Critical for our success and for the development and the further economic development. And I stress economic in the communities where Mongolian people are living, rather than of feeling that they have to come to learn better the capital city. So what we would like volunteers to do is to be in the regional schools around the country. That are a hub to other schools and help design with the English departments in the regional schools. Online English education that reaches out that you participate with us. What are the teaching strategies? What are the curriculum strategies? How do you engage students? How do you. You get the picture. But it’s two. And he was so clear as to what this model was. I was really impressed. I said, you must have had a Peace Corps volunteer when you were younger, that it’s side by side, and he described it as side by side, and that being able to bounce it off and just help keep the process moving. Just one example of all the ways that we have adapted to whatever skills and whatever education is already in place. For example, in I visited a. A school at Rwanda. And we had the Peace Corps volunteer and the other teacher, and they co-taught and they talked together before the class began. What do we want? How should it be? What do you want to do? What do you want to do? What we try. This is how we’ll check each other. We’ve got the eye contact as we’re working a way through the class. I watched this participatory way of expanding teaching opportunities between two people. The Rwandan and an American working equally with these students in this classroom. So because I came back, I used the word in the beginning spark and that process of side by side. We come with today skills that match the countries today skill and take it a step farther in that continued side by side process.

Tim Freeman: Very interesting. So it’s more complimenting. The Peace Corps volunteers come in rather than substitute in. We’re doing it the Peace Corps way. No, it’s we’re working together. A synergy of something greater. That is very interesting to hear. So in what direction do you think the agency now needs to go? You’ve spoken about the technological change, the communication. I’ve spoken a bit about the changes that have been happening in the developing world in the past few decades. Where do you see the direction of the agency heading?

Dr. Jody Olsen: COVID obviously has had an impact. Tim was very nice. I was the director that had to bring all 7000 Peace Corps volunteers home. It was the most difficult decision I made in my life, and that’s another story. But with that, we continued for another year without volunteers. And then when I left last year, the agency has continued preparing for volunteers to go back. But first, we all collectively. Let me do just one sidebar to that. Fortunately, Congress. Like Peace Corps. In fact, many returned Peace Corps volunteers or staff people on the Hill. We spread the word. And so we were able to keep full funding even without the Peace Corps volunteers, which meant that all of our host country staff all over the world, that’s upwards of 1500 to 2000 staff in 61 countries were able to continue and to see and to watch and understand changes in each country because of coping. How did the countries react? What changed economically? What changed healthwise? What changed educationally? They have stayed on the ground with that, understanding it because they’re living it themselves. We know what from the American point of view, but we also are thinking, what about a volunteer who goes over the summer? A Harvard College graduate is leaving in June for Rwanda. Are excited for her. What? Who is she? She’s different because of COVID. Rwanda is entirely different because of COVID. And so what has to happen as Peace Corps moves forward and I’ve been reading some materials about what the agency is doing right now, reframing our training. To be more inquiring of where a community is now in a country. What are the elements that have changed? Is it primarily now an education piece? Is it that the teachers are coming in and the students are going to class? Is it that a business has gone under and the economic challenges are much higher? We’re having to. Let go of a lot of what we assumed and really do these development models even more intensely based on right now and the future. Second, we began under COVID, a virtual program. We have to be very careful because as I say, the model is about being in the community. But for return, Peace Corps volunteers, in this case, primarily the volunteers we had to evacuate. We set up short-term online, ten-week projects for these returned volunteers to be able to go back to the community and us be able to legally help. That’s the key part. Congress plays an important role here and they watched. So with that, these return is a return volunteer, as we call them. We’re able to and I remember in one case looking at they were protecting and growing frogs. And I know nothing about frogs, but I remember the pictures of what they were doing by zoom in the frogs that the volunteer had here and whatever town and the frogs and his host country community. And they were continuing the frog work over Zoom. And it had a beginning, a middle, and an end and project goals to be achieved. The agency has decided to continue this program and potentially expand it, and it even builds in the three goals. I was watching one zoo where the host family had prepared its meal with all the caveats, not caveats, but all the special that go with the Peace Corps volunteer had prepared his meal with what this corn on the cob look like at mashed potatoes. And over Zoom, they had their meals together, describing and the histories and the traditions that went with these meals. So that is a very specific way that I think Peace Corps is going to open up opportunities and be present for folks that we have not been able to be before. So I’ll probably stop there. But critical in this is that we have to hear the countries conversations now next year and the year after that. We don’t bring charcoal.

Tim Freeman: Very interesting. And EP Score sounds like a great initiative and definitely one that will complement existing Peace Corps efforts at the community level and create different ways to help people across the world. I’d like to ask a question that’s that’s quite grounded in the aged care community, because the audience today is naturally scarce affiliated development practitioners. And oftentimes we’re based in Boston working in foreign countries or based in our home countries, but in the capital city in a government ministry. What would you like a development practitioner attempting to raise human well-being in rural, under-resourced areas to keep in mind.

Dr. Jody Olsen: And then I’m going to ask you, Tim, to give an example of your time in Peru and about how you. actually did that.

Tim Freeman: You are turning the tables (laughs).

Dr. Jody Olsen Turn the table? Yeah, I know. He did a good job. I checked with this country director.

Tim Freeman: I’m starting to sweat a little bit (laughter).

Dr. Jody Olsen: Yeah. These are the elements that we have learned that we keep in mind. And I want to share with you all as you think about because I know you look at development and you look at development, sustainable change, change at a macro level. And so the critical question I want to put out there is how do you find the micro? How do you find the elements of what the communities themselves are thinking and doing and find within the macro projects work how to get at. Communities and community thinking and community people. I. I want to give one small quote and they’ll come into the answer. McGlothlin and Jordan said, People are in the middle. Of development on purpose because the relationship between resources and results is not possible without people. It’s about people, number one. And it is the hundreds and thousands of communities with people who build up to what the national program and the national design framework should be and can be. Sustainability takes time. Sustainable development takes a lot of time because you’re working with behavior and behavior change. And you all know I know we don’t like to change our behavior. We love it. We love what we do. We love who we are. We love when we get up. We love when we go to bed. We don’t want to change, but sustainability requires change and change requires people and people require behaviors. And that’s what we need to work with. So we will work with local practitioners. We find them. We learn enough of the language. That we can say to them, we trust you. We’re vulnerable enough to put ourselves out in your language, we’re going to muck it up. Boy, did I mock up my time. Tim was perfect.

Tim Freeman: My catch was not quite perfect.

Dr. Jody Olsen: It was really awful. But that bit of vulnerability builds the trust because it also says, we respect you. We want to be in your space. I mean, I don’t like that. That was. But we want to be where you are and understand and see who you are. Because we can only be as good as who you are. Show our own vulnerabilities, show respect, dignity. And it means on the front end, taking time, sitting down and chatting over coffee and or tea. Those bits of language, the more coffee or tea, more chatting. How’s your family? That’s where trust comes. We’re one of those. Americans are often let’s just get on there. We haven’t got deals to make. Where you go to a lot of other countries and it’s three days of tea and coffee before you even start because you have to establish the trust in that community. Volunteers spend time with hairdressers and barbershops or whatever. The equivalent to barber shops would be sitting on stoops talking. So my thinking of when we think nationally, don’t forget, people. And people are individuals and individuals live in communities. They have behaviors and they have trust and they have needs. And they know what they want to. We have to. Spend time understanding, living and breathing that part of people’s lives.

Dr. Jody Olsen: Now you’re jumping in, now we’re going to hear about Peru at 13,000 feet.

Tim Freeman: Yes. As Jody mentioned, I was in a small town, 1800 people in the rural Andes at quite a high altitude. And I worked on an ecotourism project. And you can imagine I, as a recent college graduate, didn’t have a ton of ecotourism experience. And on the other hand, Peru is a country with deep knowledge and capacity and eco-tourism, but it wasn’t quite where I was. My village was so rural and isolated that it didn’t have the knowhow and the skills that were in existence in other parts of Peru. So I think one thing you said earlier about the spark, and that’s as a role the volunteers play actually is reflected quite well in my service because I was able to sort of be a spark and bring in resources from USAID as a small grant. And I’m glad to know that all the data I provided did not just disappear into the ether. It did go somewhere, and I was able to work with the local, not local. The National Environmental Agency, one of my fellow Peace Corps volunteers, was working with them in his site. And so then I was able to get joined up with them and bring them to town to work with local guides and local caretakers of certain towards stick sites. I was also able to work with a university that was in the regional capital, the hospitality college of the school, and bring in professors to work with, also with the guides in the restaurants and the hotels. And then I was also able to make connections with the regional tourism office. So but I was I was able to sort of play this role as a joiner because I was this volunteer who had connections to other to my colleagues sites where they maybe had a little more developed. They had better, more local knowhow and local capacity there that I could bring in. But the micro is super important because I couldn’t have just shown up on day one with a university professor and then someone working for the environmental agency and done my work. I, I, it was important that I got to know the different people and the different agencies, the local guides quite well. And I was able to understand from their needs and then I was able to bring in the right people. I was able to work with the local artisan group to see what the artisans needed and how that could interact with an eco-tourism value chain. To then allow these artisans to have a new market for their products, I had to know, know the local spots, the local touristic sites, and then I ended up organizing a three-day training session, bringing everyone together. And that would not have been possible without the months and years, in fact, I’d spent in the community getting coffee and tea, eating in people’s houses, going to however many baptisms and learning to our father in Spanish, all that. And it was so I think one of the reasons why I was able to make those connections. And then also make connections between the town and then the local capacities in Peru was because of this Peace Corps model where I was, I was quite integrated. And the good thing is relationships are robust. So once the relationships are made, once you’ve got tourism companies from the capital going to my site. It didn’t really need me and I wasn’t permanently moving to the town. So it was actually a very sustainable model in the long run. And then these relationships still exist to this day.

Dr. Jody Olsen: You’re good. That was great. What a perfect example. Let me just pick up on a note to Tim’s project, because his project was with resources from USAID, Small Project Assistance, Money Spa, as it’s called. And USAID every year gives Peace Corps about $2 million, which is pocket change in USAID terminology, but a big amount. Peace Corps. And with that, Peace Corps will give out 5000, 6000, 8000 to volunteers on a huge condition. And Tim’s work is an excellent example of that, that it has to be designed with community and the community has to provide a certain percentage of the resources, usually in-kind, but it is a community-based project and only meeting those criteria will it be approved. Well, this program had been going on for 35 years. A couple of years ago. And USAID spent a year going back into the data, doing sampling of the sites over 35 years in all these countries to see what had happened to these small projects. Over 80%. We’re still functioning and still successful. So terms are still going on that they were astounded. And we had a ceremony, a 35th anniversary ceremony, and the head of USAID came over to Peace Corps and he said, I can’t believe. About 80%. This is five years later, ten years later, 15 years later, in some cases. There they are. It’s still going. It’s still strong. Not necessarily with Peace Corps volunteers. And so it we’re proud of the model. It doesn’t make it doesn’t change the national road system, for example. But at the micro-level, it is so key that slowly builds nations.

Tim Freeman: And this is something I’m learning new the deep relationships between Peace Corps and national agencies like USAID or presidential initiatives such as PEPFAR. So how could the Peace Corps model influence organizations in the development space? So development organizations such as multilaterals or government agencies or NGOs, what can they learn from the Peace Corps model of development?

Dr. Jody Olsen: Some of what I indicated earlier about what that learning is. But let me give with that an example. I was part of the original PEPAR – President’s Emergency Plan for AIDS Relief. I’m sure you all have known it and worked with it, some of which is now almost 20 years old and billions. I don’t think a hundred billion yet, but very high. In those early years, as the agencies were all working together, particularly USAID, but also CDC, HHS, Pentagon and missing one or two. We’re working together to reduce HIV, to get out the drugs, do the testing, all of those pieces. And in the beginning, when we would sit around that table, it was. Well, Jodi, what are you sitting here for? You don’t really have anything to do with this. I said, that’s okay. I’m sitting here because you’ll discover us. It was more pleasant than that. But the as we started working together, something was something was happening because the clinics were being built. The testing was being introduced as drugs were being introduced, which meant that the drug supply chain was becoming a significant issue of. All of these were critical elements and they’re going on today in the program that. What is what CDC can do, what they can do, what HHS can do with these key elements. I was thinking I learned so much about drug supply chain management in Tanzania. That’s not us. And it’s critical that whatever agency, CDC, I think, was taking the lead in setting up and managing it. But what happened was, okay, they got all set up. And nobody comes. And it was that moment, that month, the year and now fully integrated Peace Corps integration into our program is understanding that for the supply chain to work. For the doctors to be there to talk about the daily drug regime. For the teachers. To make sure that the students are getting the particular kind of education they need about HIV prevention. You’ve got to trust the participants. The participants have to trust what this new health system is. Why do I want to go and get a shot? What’s this pill going to do? Who’s that doctor from? A different tribe that I can’t trust. That’s where the Peace Corps volunteers became an active part of this, because the volunteers, particularly in those early times when there was no trust between a rural community and a health clinic and HIV and the fear. The people had about HIV, absolute fear. And the biggest fear was to get tested because you were going to die and you didn’t want anybody to know what you were dying. Fear was huge. Well, it was that volunteer in the community with the language, with the meals, with the kids, with the chickens, with everybody that built the trust that helped people get to the health center to begin the process of being tested. And then as medication started becoming available with that and then staying with the community members as they were starting to get the drugs because you can’t stop. You have to. It’s part of your regime the rest of your life. The volunteers were there to. You know, keep the community, the guys, the women doing what they needed to be doing and coming together. That all has subsequently been handed over into the communities themselves. There’s an extraordinary number, thousands of small NGOs that do so much of this work. But it was the Peace Corps that could help demonstrate to the other agencies. The behavior and the trust component of any development project that has to play out. And that’s what we continue to do today.

Tim Freeman: That’s very heartening to hear that. Peace Corps volunteers, I don’t want to give too much credit to us, but we turn short term indicators to long term results.

Dr. Jody Olsen Yes.

Tim Freeman: So one final question before opening up to the audience, and I’ll keep it light to bring the conversation back to the namesake of the building we’re currently in. What would JFK say if you looked at the Peace Corps and its role in global affairs today?

Dr. Jody Olsen: Well, I know what I would want him to say. This is spectacular. Everything I hoped it would be, I would. I mean, speaking of reality here, closer to reality. What? The original Peace Corps building had a huge quote. Quote, We all know from JFK that you could not walk in the building without saying, ask not what your country can do for you, but what you can do for your country. And I hope because that was why I joined the Peace Corps. Was. Every day. I walked into the office in that building. I looked at that. It is. What can you be doing for this country? For others? And I hope. That John Kennedy were here today that he would be able to say Peace Corps honors. Ask not what your country can do for you, but what you can do for your country. If he would say that, if he would say Peace Corps represents that, I would be a very happy person.

Tim Freeman: But thank you so much, Jody. And now let’s open it up to the audience first in person, if anyone.

Attendee: It’s great to see you again. That’s amazing. I have two questions. One of them hopefully be able to talk later because it’s more of a we’ll call it a nerd question now. My name is calling from the bank. I’m on the other side of the river, actually in the engineering school. And I apologize for being an engineer. And that is a lot of the data talk.

Dr. Jody Olsen: And then wait a minute, just as you’re asking the question. Both my son and grandson are engineers.

Attendee: Thank you very much for redeeming me. So the quantified ability aspect is always a source of concern. And I thought a lot about what you said in different circumstances, a lot of wisdom there. And I was doing some research and I wondered if you how do you think about Peace Corps? A is a creator of evidence, something not just community driven development with these small initiatives, but also part of the I would say, cultural, diplomatic ethos. We, we, we, we, we don’t do because we do, which we show that we do what, you know, walk the walk in some sense of where the telling the story of these projects and YouTube videos by the actual volunteers and creating different sources of evidence to the rest of the world that all of these wonderful things are happening from just a communications standpoint. I understood that there might be security concerns before, but I was wondering if the you know, just trying to think through all of them this impulse to take to how we might here. But I believe that human connection has to be as important as building a bridge. It just has to be. I mean I mean, it’s ridiculous to think that it isn’t. And I think the problem is we just can’t seem to. Quantify it in a way that makes it.

Dr. Jody Olsen: Oh, let me give. I love your question. Or you just come to the core of all so many conversations I’ve had. And you heard me earlier allude to that we took at one point a few years ago, we took about 100 different stories that Peace Corps volunteers had told, that we had preselected four books. Well, they had given permission. And it’s what we use to recruit for recruiting purposes. And we looked to it. It was just when the software was beginning to. Come to our aid to look at how do you quantify data? How do you provide evidence? I loved your term. From stories. And there’s over the last several years I think and I haven’t stayed with the literature but there’s it’s becoming much more profound. What? One, I think that the quantification of stories and using some of those data techniques, data mining techniques can be really helpful. I’m going to give an example of what happened. We it’s a lot of work because we were doing it largely by hand and all the testing and the pre-testing. And do people see it the same way? You know, all that stuff better than I do. But one of the discoveries we found about as we were into it was that in the stories, the most common. Reference. Mr. Little Kit. And like the word spark, this reference to kids had just passed us by in that moment of we’re big and fancy doing big and fancy stuff. Well, for the volunteers it was the kids and it was the affect and it was the time and it was the getting to know. And it was the language and it was the food. And so much of it came through the kids. Well, that in our, you know, less than perfect way was I found an extraordinary piece of evidence. And how do you build trust? And what impact might that have on the kids later? What was that interaction that we weren’t paying any attention to? In many cases, that actually was so fundamental to so many Peace Corps volunteers. So it doesn’t quite answer the question, but I think it reinforces the importance of the question.

Attendee: I think it does. Um, I think it does. I think it’s a very high bar to clear it when someone trust your children. Right. And that’s a that’s a good, quantifiable fact. You know, although these Americans are crazy where one is the one involved here, he took care of platooning. So I think is a very high bar. Anyway.

Dr. Jody Olsen: Let me give an example to that part of it. Clear that the one particular in Togo, when I was there, that a young girl, a young student was just not doing very well in school. And the Peace Corps volunteer said to us, let’s, you know, let’s do something after school. And so the volunteer brought his guitar. That he had in country. And he started teaching this kid music and they started singing together. Well, when I was in Togo, this young kid was now the number one singer in Togo. He was famous across West Africa. How do you measure that? And see, that’s the piece in Peace Corps I, I so struggle with because I don’t want to lose what that is. What was it that that volunteer knew he had the time and it was for those three struggles that he had the time to take individual time after school with a kid. And do music together. That’s not in his job description. That’s nowhere. And yet that probably did as much as ever gets done. And was extraordinary. That’s why measuring this is so difficult, because it might be five years, ten years, 20 years. We don’t know which one. I mean, the head of Ecuador, when I was talking with him, he talked about being out there and, you know, being very poor. Very. And he said, let me tell you about. But the volunteer took time with me. We learn to read together. 20 years later, how how would we have known if I hadn’t had that conversation? So you’re it’s the question I think is that’s really important because it will be so hard to have an answer to it. But if we keep the question in mind already, it’s a gift. That we have to have data, but it’s the story that brings it to life. It’s the story. That keeps us strong.

Attendee: Thank you. (Inaudible) 

Attendee: I had a couple of questions. The first was around like, how does how come Peace Corps feels so unique because it feels like it hasn’t necessarily had the same sort of momentum take off in other countries. I myself did, what I think what would be the UK equivalent of its natural citizen service.

Dr. Jody Olsen: Did you do BSL?

Attendee: I didn’t do BSL.

Dr. Jody Olsen Okay, but I get it. Yeah. Great programs.

Attendee: It feels like it never gained the same credibility, the same set, the same momentum that Peace Corps has. And I think kind of the second question kind of comes from that was to myself this question I ask myself around. I felt like the investment was in me. Like, I think that was deliberately of the (inaudible) objectives. I feel like I kind of had like a duty to take that from that. I couldn’t quite say, Listen, why I’m here now. But is that a matter of is that value? Was it investment in me or how do you consider it? And how should Peace Corps Equivalency volunteers think about that? It seems a very different model to be investing in people from your own country versus towards those in need.

Dr. Jody Olsen Oh, yes. You just hit another favorite topic is in Peace Corps language. We call it the third goal, which is that third goal of sharing back in the United States. A couple of things happen because you. Yes. I love what you said. I feel this duty. Because look at what this experience did. And you’re sensing what this experience did for Tim, what this experience did for me. We talked about what’s happening there, but we’re different. Something happened to us. And it again is what we call that third goal, but it’s what drives us forward, hopefully to continue to give service, to do things we otherwise wouldn’t do. And I think part of what has kept Peace Corps and built this is that we have built this part of it. Into what Peace Corps service is all about. When you sign up for it, I feel passionate when you sign up. You’re signing up for the rest of your life. Overseas. It will be two years. But it becomes you. And in you becomes others. For years afterward, which is why she. I was with the ambassador from Indonesia in Washington, and he invited all the returned Peace Corps volunteers from Indonesia over to the embassy. And he stood there in front of the 120 that were wearing all those fabulous shirts that you get in Indonesia. And he said, You are much better ambassadors than I am. Here in this country. Because you know it and you see it and you work in your share. One small example. The volunteers who go into education, go into public service. Many. A disproportionately high, although statistically is hard to prove. So I appreciate your background in well over from us here but. Or giving back. Comes from what that experience was. And we try to indicate within people, this is good. We’re stronger. Others are stronger because of that feeling you just described. So Tim feels it’s what I feel. It’s like, why am I here right now? It’s about service. So thank you. I really like your question. And don’t feel guilty. Just keep doing.

Attendee: Thank you so much. You mentioned the really interesting discussion around how Peace Corps is value-add for the country. So it’s working and has had to change. And I wonder, how has the interest from college students, the United States or what they’re looking for changed, especially in the last, let’s say, ten, 15 years as conversations on inequality and justice at home have taken more center stage? And have you seen a shift in interest towards programs like AmeriCorps or just public service at home rather than trying to do that service abroad? Okay.

Dr. Jody Olsen: Excellent question. I’ll touch two or three parts of it. One in 1961. But I won’t give you all 60 years. In 1961, two-thirds of all Peace Corps volunteers were men. Today, two-thirds are women and so on the concerns side. I, I worry that not enough young men are finding all of these opportunities. AmeriCorps, Teach for America, other kinds of service learning projects. We’re not seeing the men. And we also see it in our data for college graduates and graduate school graduates. So the concern side is we’re slowly I won’t say losing. But there’s a reduction in an important part of what the United States is. It is not participating as much as it should. So any advice anybody has these groups very eager to pick up on it. It’s been very, very fortunate, too. And this is the other side of it. Peace Corps in the early years and really the first 20 or maybe 30 years was largely white. And so persons of color or about 10%. Which is relatively small. The exciting part for Peace Corps is. We have and I feel very proud of this. At the time, we had to pull everybody out. We were 36% people of color. Which was pretty close to a representation of college graduates in the United States. And what we appreciated is that over these last several years, it changed who we are. Who we are in the future. Who we must be in the future. Because it was the diversity. Of the volunteers hard. We’ve had to rework all our training. Because it’s not only how are our voices with each other as groups of volunteers overseas for two years, but how are we as individuals overseas and whatever our background is interacting with people in the country? Because they see us depending on how they want to interpret us differently and treat us differently. So it’s a very complex. Need. And I think Peace Corps is working hard. To one. Help us be better with each other as a diverse group of volunteers going overseas, as diverse as we can be, and to how do we work in countries? Being that diverse group. I was talking to a staff person from Vanuatu who had worked for Peace Corps for 20 years, and I asked her, Vanuatu, is this island nation in the Pacific? Probably not very many people. And. I said Peace Corps has been here 20, 25, 30 years. Any comment that you might have having observed this time here? And then I watched you and she went a half. It’s the diversity of the Peace Corps volunteers. You have taught us so much in what you bring as a diverse group of Americans. Being who you are. I was flabbergasted. She said, We’re a very small nation. We’re an island nation. We’re basically one tribe. We don’t know what that is. You have given us an extraordinary gift. And so. We as an agency that draws I guess I’m still aware that draws. All of the richness of young Americans. It’s important that in it being part of another country. We know who we are with each other and that other country, and we know how we’re interacting with individuals and communities in that country. So we can be the best with them. They can be the best with us. The. All its happened in the U.S. as volunteers now go overseas. It’s how to manage that. How to hear the other country’s side of whatever these stories are before telling ours? They’ll be time to tell ours. But what are theirs? A Peace Corps volunteer in Malawi. The issues that he had with being black. In Malawi, for some reason, they wanted him to be white. And so after they said that to him very directly, he informally, with students that he was teaching, and at home in his little hut, rigged up the solar panel and made sure all the electricity came in. And he started showing American movies that really represent a more holistic perspective of race differences. And he talked about them informally with people who came and changed the whole conversation in that community in Malawi. But he didn’t start doing it till he had been there for five, six months because he had to have the trust with the community first. So that’s how we try to work and interact with the second to the second part on the quantity question. Peace Corps has. Many, many, many people who want to serve that has stayed strong and steady. And the increase for AmeriCorps and I don’t know about Teach for America, but particularly AmeriCorps work and volunteer work in the United States is strong and steady and growing. And I think the crises of climate will the crises of living forces us to look at ourselves and climb inside ourselves in ways that we have before. And hopefully that means more volunteers.

Tim Freeman: And there’s quite a lot of action going on on the Zoom. So let me make sure that the Zoom participants get their voice heard. We have a question from Cariana de Battista. Peace Corps is such a unique approach to designing and implementing grassroots initiatives. What lessons or best practices can other organizations, perhaps without extensive field staff, take away from this model to ensure that local development is truly addressing issues identified by communities and not doing so with communities not on their behalf?

Dr. Jody Olsen: I would say, and I know the issue of resources and so many organizations that are nationally focused or here and working in places around the world, it’s very hard to have a model that replicated Peace Corps because Peace Corps, you know, has that American in that interactive process there. I would say that what is so critical is first asking the question. When we’re looking at an initiative or a development initiative, have we heard from communities? Who’ve we heard from. Whose voice is helping put this together? Is it our funders voice? Let me introduce that topic. But is it the Minister of Health voice? Whose voice is it? And I think in whatever and however resource based is the ways and I think there are ways through local participants that are not very costly, that can bring actually some of the community mapping, that can bring some of the community walks. Done by. With local people about local people, having them have conversations about needs and wishes that find those spots. But ask the question which will help I think organizations find those spots with. Have we heard from the community? Okay. Just one quick example I go on to, but one quick example. When we were doing this exercise in Malawi and what we found under the needs and wishes that are need among the clinic health workers was a stretcher. Now, for most people, you don’t even think of a stress. But that was probably the most significant need that they represented. Because they had no way of bringing really sick people or bodies from villages into where they could treat. And a stretcher would change entirely the transportation. It. And we appreciated I mean, we were not in that business. But as we then turned to those who could be in the business that. How would we have known that even national. Focusing on stretchers or on how to reach out. It’s because we listen to the community. So I think that’s a really important part of this model.

Tim Freeman: I think that’s the perfect sentiment to take home with us today. I’d like to thank Jody for joining us and sharing her insights with us.

DISCLAIMER: This webinar transcript was loosely edited and there may be inaccuracies. 

Oded Galor:  Well, thank you very much for the introduction and delighted to be here and to present the booklet I released yesterday. The book is focusing on the journey of humanity, namely the evolution of human societies since the emergence of anatomically modern humans in Africa nearly 300,000 years ago. And in fact, it focuses on two fundamental mysteries that surrounds these journeys the mystery of growth, namely what are the roots of the dramatic transformation and living standards in the past two centuries after hundreds of thousands of years of stagnation? And the mystery of naming what is the origin of the vast inequality in the standard of living across countries and regions of the world? Well, most of human existence, human life was largely nasty, brutish and short. Like any other species, humans were largely preoccupied with survival and reproduction. Living standards were very close to the subsistence, and they were minor differences in living standards across time and across space. In fact, a few centuries ago, one force of newborn did not reach their first birthday and one half of them did not reach their reproductive age. Numerous women perished during childbirth. Life expectancy fluctuated in a very narrow range of twenty-five to 40 and rarely exceeded forging. Most people very, very different from doing most birthplace over their lifetime. It was largely illiterate and they lived in the darkness after the disappearance of the Sun over the horizon. And perhaps more strikingly, an economic crisis during this period did not lead into a better fighting. It led to massive invasion an exception.

But then something very dramatic occurred in the past 100 years and metamorphosis. Dramatic transformation in living standards across Muslim societies. Income per capita in the world is are all within. This 200 year period is increasing by a factor of 14. Life expectancy has more than doubled and there is a great divergence in income per capita across countries and regions of the world. Oh, it was this dramatic transformation, consider for a moment, residents of Jerusalem at the time of Jesus, residents of Jerusalem at the time of the end of the Romans. This is nearly 2000 years ago and with this individual forward in a time machine to the Ottoman period, Jerusalem in the 19th century. Despite this 2000 either jump is individuals will be able to instantaneously adapt to the new environment. That knowledge would be largely applicable. Technological improvements would be merely incremental. Occupations would require very similar skills and life expectancy would remain unchanged. And as a result, it would not necessitate a change in the mindset of individuals. But now consider these individuals and we ask them yet again. But only 200 year olds from Ottoman Jerusalem in the 19th century to contemporary Jerusalem in the 21st century. Despite this minor jump, in terms of the time period, this would be a devastating experience, a shocking experience. Boston College would be largely obsolete. Modern technologies would appear literally as witchcraft. Occupations would require incomprehensible skills and life expectancy would instantly double. And as a result of it would require a different type of orientation. Future oriented orientation. Education decisions. Saving decisions. Life saving decisions. So in contrast to the conventional wisdom that exists in some sectors of economic discipline and beyond. In fact, living standards is not increasing gradually in the course of human history. Technological problems evolved gradually in the course of human history, but I read your paper on the standard of living generate a larger population, but not free motivation. And in fact, the recent large rising in living standard reflects what we defined as based transition, namely an abrupt transformation once a certain tipping point has been reached. So to conceptualize this change, consider the evolution of Income per capita in the past 2000 years. And what you see in front of you is a striking picture, namely, economies are in a state of stagnation, Malthusian stagnation for most of the course of human history, for the past literally hundreds of thousands of years. And then something very dramatic is occurring in the past few hundred years, a dramatic spike in the income in Income per capita in the world of the magnitude, as I said, and 14 times. And in fact, some regions of the world are experiencing an increase in income per capita that is 100 times an artist, 50 times so an average 44. In fact, if I would take this diagram and I would remove the labeling of the axis and I would show this diagram to a random scientist. Probably most people will say that this is the output of assessment graph that detects tectonic activity and eruption, but in fact, this is precisely the evolution of income per capita. Suddenly we see this eruption and this is a large extent what they will defined and what they define in the book as the mystery of growth.

Now, at the same time, this take off is not OK here at the same time across the globe. Some societies are experiencing this take off as early as the beginning of the 19th century and even earlier and others only recently. And as a result of it, we see this great divergence in income per capita that is occurring in the past two centuries. Western Europe and Western offshoots are taking off first. Other regions of the world are lagging behind, and there is a huge gap that is emerging in the world across. Now, initially, we would like to respect. And to resolve these two fundamental mysteries, the mystery of growth and the mystery of inequality, we have to develop a better identification of the forces of militarization of stagnation to growth. We have to develop a better identification of the forces that brought about the differential timing of the transition across the globe. And we have to understand the role of historical and the processes that contributed to this differential, the timing of the transition across the globe. And naturally, if in fact, we can resolve these two stories, we would be in a better position to design strategies to mitigate inequality across the. So in order to resolve these two mysteries, the book initially marches forward. Any time from the time of the murders of anatomically modern humans in Africa, 300,000 years ago to the present. And. The underlying condition is it is not true. Holds the secret for the mystery of growth and ultimately the mystery of inequality, namely when we are about to resolve the mystery of inequality, we will have to be in a better position to understand the role of deep-rooted factors. Income per capita development today, namely, how the events that occured hundreds of years ago, thousands of years ago and even tens of thousands of years ago, are lingering and affecting comparative economic development projects and consequent game focus on phases of development. And when you think about phases of development, one can identify three fundamental phases some developed to generate the possible vision regime and modern growth vision in which the people in this movement reside. The multinational effort originates.

With the emergence of anatomically modern humans in Africa, the three thousand three hundred thousand years ago and its France ninety-nine point nine percent of human existence lasted about the eve of industrialization in the context of the most developed societies in the world. And the conclusion of that book is characterized by interesting, interestingly, on the one hand, stagnation in living standards. But on the other hand, great dynamism in technology and population and human adaptation that ultimately permits to take off from stagnation to growth. So over this 300,000 year period, these processes are ultimately leading into the take-off from stagnation to growth, leading initially into the hospital generation and then the onset of the demographic transition is freeing the growth process from the counterbalancing effect of the population and the world is sailing into the modern growth version. So given the importance of the military unit in the understanding of contemporary inequality, why some countries are rich and others are poor. Let me try to identify the three fundamental winds of change that are governing the processes of development and progress for orchestrating this transition from stagnation to us. So I think that demonstration is characterized by important hydraulics stagnation, along with dynamism stagnation in living standards in a sense, and income per capita fluctuates around a subsistence level and life expectancy fluctuates in a narrow range of 25 to 40. But dynamism in the context of technology, in the context of population and in the context of human adaptation. No, at any point in time, what I refer to, the dynamism is very, very slow and very, very low. Namely, we see slow rate of technological progress, slow rate of population growth and slow rate for the base and over 300,000 year period.

This process gains momentum up to a point in which, in fact, these three forces are generating the transition from stagnation. So the first building block. In this winds of change is the impact of technology on population and during the most recent technological progress actually generated an increase in income. But this was not long lasting. Why? Because again, if people adopted fertilizers, better technology, better lives, they have largely larger output than before. But this output permitted more of their offspring to survive four million more offspring to be born. And consequently, population grew, and ultimately, the income reverted back to the previous equilibrium position over most of human history. It was logical progress was converted into more people rather than into entropy. So, broadly speaking, technologically advanced societies or land rich economies and higher population density, but largely similar level of income. And the evidence is striking in this respect. Look at the relationship between. Len, productivity, as you can see here. And population density along the vertical axis. You can see this pronounced positive association. More fertile land is generating higher population density, and the same would hold for the relationship between technology and population density. But the striking element is there is no association between land productivity and technology and income per capita, said Richard. I mean, societies that originally land, societies that have more advanced technologies have larger population density, but very similar levels. The second important building block will for change is the impact of technological progress on human activities. So this really isn’t just a huge amount of pressure affected the size of the population, but in addition it affected the composition of the population. And why is it so naturally traits that were complementary to the growth process to logically generate in higher income? But in the material world, higher income was converted into higher reproductive success, and consequently, these traits that were complementary to the growth process became more and more prevalent in the population over time. And you said the patient raised the prevalence of complementary traits with the growth process and reinforced the differences and ultimately reinforced the take off from stagnation to growth. This is the second we have to change if we will focus, and a third one is in fact the forces behind technological progress. And here the argument is very simple the size of the population and the composition of the population affects technological progress. Why is it so? Because the size of the population affects the number of individuals, namely the supply of innovations the size of the population affect the number of individuals that may use the technology and the demand for which it affects the diffusion of knowledge and the fact that individual labor, any defects, the extent of trade and all of these forces are contributing to a technological problem.

So in the course of human history, what we can see is the following. Population size increases over time. The composition of the population is adapting, and they’re both affecting the rotation of the wheel change latest technological progress technological progress becomes faster and faster and faster. This technological progress becomes faster, the size of the human population gets larger and the attention gets large. So we see these winds of change. Reinforcement between population size and population composition and technological progress. And the feedback from technological progress into a population size and the limitation. Now, over most of human history, this rotation is relatively slow, and it doesn’t necessarily necessitate any investment in human capital on the part of the population. But ultimately, we reach a point in which technological progress is so rapid, so it’s to require human capital in order to cope with this rapidly changing technological environment. So human capital becomes essential in navigating this stormy technological environment, parents start to invest in the human capital of their children. But given the fact that they have limited resource constraints, they have to economize on the size of the population. It implies that the demographic transition is taking place. Fertility starts to decline. The growth process is framed from the counterbalancing effects of population, and the world is sailing into the modern world, especially. Now, as they said, this transition is what may be defined as a phase, but think about a phase transition in nature, a transition from liquid to gas, naturally sweet water. And as the temperature increases, initially, there is no change in the state of this of these sort of monuments.

But ultimately, as we reach agreement a threshold, we see the operation of these water molecules and then transition from water to guys very similar in the course of human history. We see that there are circulating forces operating below will be below the surface. And this is basically the rate of technological progress and its impact on the latent demand for humankind. But since the ideological approach was initially so slow, we moved from one stone technology to another one. It doesn’t require any human capital increase in intimate human capital is very small, and as a result of it, we do not see any of us. But ultimately up to three hundred thousand year period when we move from stone tool the analogy to steam engine technology changes being made. And then we see this dramatic eruption, namely a phase transition that allows us to move from stagnation and from the agricultural state of development to the industrial stage. So what we see behind dramatically is the concept of education. Namely, we are living in a particular state in terms of in terms of economic development. And then suddenly, the maturing equilibrium seems to vanish and we are gravitated into the modern growth machine. Now, when you think about the March of Humanity, broadly speaking, it appears that the March of Humanity to a large extent has been unstoppable. In what sense, if we think about shuttering and dreadful events in the course of human history, World War I, World War II, the Spanish flu, the Great Depression and most recently in COVID 19, poor people who lived through this crisis. These appear devastating and perhaps insurmountable. But what history teaches us is that in fact, many of these dramatic and devastating as they were and limited impact on the ground of humanity, the humanity recovered from these tragedies with great haste and continue its march forward.

So naturally, at the moment, we are all facing an internal question actually more than others. This humanitarian crisis that is developing in Ukraine. And again, this is devastating. And if we think about the Ukrainian people, they will deal with this, the aftermath and the consequences of these atrocities for the next decades and perhaps beyond. But at the same time. History suggests that the gloom that is sort of surrounding us these days is perhaps not necessarily in place in the sense that history suggests that it is very unlikely that this event and similar events with uranium money from its relentless march. So in this respect, as you will see when you read the journey of humanity, the journey of humanity’s hope is is providing a very hopeful outlook in these gloomy days about the future of humanity. Nevertheless, you may ask yourself what if climate change will be the single most devastating events that will ultimately devalue money from its relentless march? And here to the journey of humanity, both the book and the actual journey provides very helpful in what sense it suggests to us that technological acceleration that existed in the course of human history is in fact the catalyst of climate change. It is technological acceleration. Brought about industrialization, industrial pollution and started the process of climate change. But at the same time, it is this technological acceleration that brought about human capital formation.

The power of innovation and as we experience in the context of COVID 19, this power of innovation is so incredible that it was able to terminate a major pandemic in a relatively short period of time. So in the context of global warming, given the fact that this technological acceleration increases the power of innovation and at the same time brought about a decline in fertility rates, even India is now just battering replacement level infertility. This suggests to us that these processes are bound to first mitigate the pace of climatic change. But most importantly, provide scientists with the needed time to develop these revolutionary technologies that can, in fact. Reverse the current pattern that we see across the globe and ultimately turn this crisis, hopefully into a fading memory. So as I said, when you read the book, you will notice that the first part of the book is marching forward, starting in Africa three hundred thousand years ago and moving to the present. And in this course of the first part of the book, The Mystery of Growth is resolved. Nevertheless, we remain with the mystery of inequality, namely what are the roots of the vaccine inequality in Income per capita, as we see today? So the second part of the book is, in fact, taking the opposite course of direction in terms of time, namely starting at the present and marching gradually backward in human history, feeling gradually different layers of influence. Initially, institutions, culture, geography, Neolithic Revolution and back to Africa at the time of the exodus of humans 60 to 90 thousand years ago, and basically providing us with essential tools to understand the roots of inequality and consequently providing us with the tools to design policies that could mitigate inequality. Today. Now, initially, when we look at the uneven development across the globe, it is very tempting to attribute it superficially to differences in education, differences in physical capital formation and differences in technological the proximate cause. Yes, of course, they’re correlated with them.

But the question that emerges is why some societies fail to invest sufficiently in physical and human capital formation. Why some societies fail to adopt advanced technologies. And this leads us into the understanding that since much of the inequality that we see across the globe today was originated. In the past 200 years due to the differential timing of the transition from stagnation to growth, and since this differential timing reflects forces that existed in the distant past, we must focus on deeper layers of influence. This takes us into the deeper roots off of what I will call historical and prehistoric coal barriers to development. Initially, institutional and cultural characteristics and finally the ultimate truth, namely geography and human characteristics. So let’s start with the fingerprints of institutions. Naturally, what we see in the course of human history is the emergence of differential institutions across the globe. We see the emergence of growth-enhancing. Inclusive institutions in some societies, and we see the emergence of growth retarding extractive institutions in others. But yet again, institutions are rarely manna from heaven. The question is, why do we see this differential adoption of institutions in different corners across the globe? So admittedly, there are some critical junctures in which differential institutions are emerging quite randomly. We can think, for instance, about the impact of the Black Death on the decimation of the European population, 40 percent decline in population, scarcity of labor and consequently competition of the over the labor force that is leading into the decline of feudalism, the emergence of property rights and ultimately a poor, perhaps industrialization in England. We can consider, for instance, the glorious revolution and its impact on the emergence of constitutional monarchy in England and ultimately the emergence of industrialization. Or perhaps most strikingly, we can consider the division of the Korean Peninsula along the 38th parallel that is naturally generating an inordinate hell and a southern paradise.

So certainly, we can consider a counterfactual history in which if the Korean Peninsula would not have been divided along the 38th parallel and segments of the society in Korea would have enjoyed a different level of income per capita, as we see today, what we can consider the possibility the James the sinking would have defeated William of Orange in the battlefield. The glorious revolution would not take place. Absolute Monarchism would remain in England and in fact, even it wouldn’t even revert to Catholicism, in which case perhaps industrialization would have occurred in Holland rather than in England. Yes. So there are some critical junctures, but we can name them, perhaps on a on on one hand, perhaps on two largely speaking institutions, as mostly evolved gradually in response to economic development and in particular, the transition into the Neolithic Revolution, namely, the emergence of agriculture nearly 12000 years ago is associated with tremendous increase in population density. And this tremendous increase in population density naturally generates demand for institutions that can generate cooperation across individuals that can facilitate the introduction of necessary public goods and can generate social cohesiveness. Broadly speaking, or we can think about other geographical corruption as the suitability of the soil for large plantations. Naturally, the suitability of the soil for large plantation led gradually into the emergence of large concentration of land ownership and ultimately to the emergence of extractive institutions and even slavery. And we can consider the decision, but it is this environment was a hurdle in the process of development and hurdle in the process and the adoption of centralized institutions.

So as I said, mostly in the course of human history, we see that institutions are responding to economic development. And this implies that if we want to understand the roots of inequality today, we have to peel the layer of institutions and to look deeper. And this brings us into what I will define as the cultural factor. So again, in the context of culture, we see the emergence of differential cultural traits across the globe. We see the emergence of growth-enhancing cultural traits such as social capital in some regions of the world. We see the emergence of growth retarding cultural traits, for instance, family ties and other roots. And in fact, many have attributed the Italian divide, the northern southern divide in Italy to the presence of social capital in the north and family ties in the south. But again, cultural traits are rarely manna from heaven. So why do we see social capital in northern Italy and family ties in southern Italy? Again, admittedly, there are some critical juncture in which culture cultural mutation emerge. And as a result of it, we see an inertia that is persisting over time. And perhaps the best case in point is in the context of Judaism and basically mandatory literacy that is imposed in the first century without any economic justification. It’s a great economic liability at the time, but ultimately, as economies are developing and human capital becomes very important in the production process, this random mutation becomes very, very beneficial. We can think about the Protestant Reformation, not necessarily in the context of random mutation, because naturally, the Protestant Reformation reflects some political and religious competition at the time. But naturally, the Partizan Reformation, the emphasis on swift and interpret worship as a tremendous impact on the spirit of capitalism and the transition from stagnation to growth. But this, I said, culture in the course of human history, largely adapted to the geographical environment, a technological environment, the economic environment.

So naturally, the rise in the return to human capital changed the attitude towards investment in children, investment in education. The agricultural return to two different yields in different societies induce certain investment in agriculture and told people how to delay gratification and was behind the emergence of future-oriented mindsets. Climatic volatility affected the degree of loss aversion in society and as a result of it, entrepreneurial spirit. And lastly, the suitability of the land for the use of the power plow affected the adoption of the plant and consequently provided a comparative advantage for men in agricultural production and generated persistent gender bias that affects labor force participation even today. So again, if we think about the cultural factor, it appears that a geographical element behind it. Human element behind it. Technological elements behind. So we need to move into the deeper layer of influence, which is basically the shadow job of. If we think about geographical characteristics, soil quality, climate, the disease, environmental isolation. Naturally, they ended, they wrecked. They do have direct impact on economic development. They affect labor productivity. In fact, human capital formation effect, trade and affect technological progress. But in addition, they have an indirect effect. They just argued on the evolution of cultural and institutional characteristics. Naturally, these are deep-rooted foxes, ultimate factors that we would expect to have a tremendous effect on the contemporary level of inequality across societies. Now, focusing on geography leads us further back in the course of human history into the onset of the Neolithic Revolution. 12000 years ago. So, as you know, at a certain point in human history, we see this transition from hunter-gatherer tribes to agricultural communities.

And this transition is generating certain surpluses. This permits the emergence of a non-food producing class. Why is it so important? Because this non-food producing class is associated ultimately with knowledge creation in the form of science, in the form of technology, and in the form of written languages, and generates a technological headstart that persist over time. So variations in the timing of the onset of the Neolithic revolution across the globe that can be mapped into certain geographical endowments. Could be the origin of some of the variations in Income per capita across the globe. This is, in fact, the diamond hypothesis. Now, empirically, what we know at the moment is that, in fact, the diamond hypothesis is relevant for the understanding of comparative developmental about the shifting in the past fifteen hundred period. In fact, the entire argument is moot. And the reason is that transition to the knowledge was associated with two elements the one that was emphasized by Diamond, namely technological and such. But the second one is comparative advantage in agriculture and comparative advantage in agriculture, as we know, has limited technological spillovers. And as we moved into the modern world in which industry and the urban sector were, in fact, the hub for technological innovations, those societies that a comparative advantage in agriculture started to lag behind. And these two forces started to offset one. So as I said. Revealing deeper and deeper layers of influence are taking us with the diamond hypothesis twelve thousand years back, but in fact, we think deeper we can go back all the way to Africa. And this leads us into the out of Africa hypothesis of comparative development. As you know, humans are departing from Africa nearly 60 to 90 thousand years ago, and we are all offsprings of this migration. No exceptions. And naturally, this migration is affecting the distribution of population diversity. I will show you momentarily. And consequently, comparative economic development across the globe.

So during this exodus of modern humans from Africa, departing populations carrying was themselves only a subset of the diversity that existed in the original population, whether it is cultural diversity, phenotypic diversity, behavioral diversity or linguistic diversity. And why is it so? Because the original population is rather small. The departing population is rather small and we are sampling from a limited distribution and the sample is not representative sample. Some of the diversity that existed initially evaporated in this process. Now, in addition, the process, the migration process is sequential, and as a result of it, each step that humans are making out of Africa is reducing the degree of diversity further and further. So to further, an indigenous population is from Africa, the less diversity. This is a good illustration of the argument, if we start with the population in Africa and this is the level of diversity that exists initially and humans are departing initially into the area of the fertile crescent, then those population, those individuals that are departing and not caring, the entire diversity that existed in the African population. Now, this population when settled in the Fertile Crescent will grow ultimately and ultimately it will be forced to migrate in the search for more fertile land. They will move into Central Asia, into the Bering Strait and into the Americas as they take each additional step. In fact, the population becomes more and more homogeneous, and the data is striking in this respect.

If you look at migratory distance from Africa in. Ten thousand kilometers in those societies that are about 25,000 kilometers from Africa and migratory distance are the least diverse in the world. The African population is the most diverse, followed by the Middle Eastern population, the European population, the Asian population, the Oceanian population and Native Americans. And this will be true regardless of how you measure diversity. Any measure of diversity will provide you precisely what these spots. Now, why is it so important? It is so important because diversity has conflicting effects on productivity. On the one hand, it has beneficial effects on creativity and innovation because diversity permits cross-fertilization of ideas and complementarities in the production process. But on the other hand, diversity affects social cohesiveness. Generate mistrust, generate disagreement about a desirable public goods and consequently generates conflict. So given the fact that there are two conflicting effects, if in fact each of these effects is positive and diminishing effects on diversity. Then we should expect to find the hump-shaped relationship between diversity and development and evidence of striking in this respect. Look at Panel A. This is population density Indy 500 hump shape relationship between diversity and economic development today based on migratory distance from Africa 60 to 90 thousand years ago. And to countries that are residing here at the peak of the hunt are Korea, Japan and in China, naturally, not countries that appear to us very diverse. But this is a different time period in which diversity is less important because technology is not evolving very rapidly and innovations are less important than social cohesiveness. But as we move into the modern period. In fact, the arms remain, but the peak of the hump is associated with the Society of the United States, namely the level of diversity. It is optimal for development is increasing in the context of development, and this will be truly will focus on urbanization rates and luminosity in the contemporary period.

Now, alternatively, you can focus on ethnic groups rather than countries. And if you focus, in fact, on all the ethnic groups and ethnographic objects, one thousand two hundred and 65 ethnic groups, you will see that in every thousand years, starting with one thousand B.C. Twelve thousand years ago, we see this pronounced hump shape relationship between migratory distance from Africa and economic development. So. Back to the winds of change. As I said before, the size of the population, the composition of the population and technological progress are the winds of change. They are orchestrating ultimately the transition from stagnation to growth. But the pace of this rotation is not independent of other forces. The pace is a function of institutional factors and cultural factors. And of course, they are affected by geography and migratory distance from Africa, and consequently, in the course of human history, societies that were fortunate enough to reside in places where did you graphical endowment or the migratory distance from Africa was an optimal one, took off much earlier than others and the divergence of care across the globe. Now, if you ask yourself about the roots of comparative development. It is quite apparent that nearly 90 percent of the variations of Income per capita today can be traced to deep-rooted factors, the migration of humans out of Africa accounts for about 17 to 26 percent of the unexplained variations in inequality. The time since human settlement and analytic revolution explain about three percent, mostly the time since human settlement, geographical and climatic factors huge component twenty-seven to thirty-eight percent the disease ecology 10 to 15 percent cultural factors about 20 percent and political institutions such as Executive Constraint and Polity for the Democracy Index explain about three to nine percent.

So there are many factors that affect comparative development. And Essay said the second part of the book is stepping backward and trying to identify each of them at the time and reaching this conclusion about the relative magnitude of these factors. Naturally, all these factors are important and very important for the understanding of the world. Now, as you know, when Malthus was engaged in the writing of his dismal predictions about the future of the world. People attributed is right attributed to the economic science, the name, the dismal science. And the reason was that Malthus was associated with dismal prediction about the fact that humanity’s doing. And in fact, we will not be able to escape from the arms of the Malthusian octopus. Now, does it limit what they do here? Does it imply that in fact, the fate of nation is written in stone and in fact, there is geographical and historical determinism? Not at all. Basically the opposite the insights from the journey of humanity, the book and the actual journey would permit us to design growth-enhancing policies that are country-specific, history specific. It will be critical for the ability of humanity to flourish in the decades and centuries to come.

Let me illustrate in a very simple fashion. Wouldn’t the World Bank is preaching to less developed societies, suggesting policies that can mitigate poverty and inequality, they naturally emphasized fertility control and education, but when they emphasize education, it is basically use of education. Let’s assure that population is more educated, in other words. And this is a wonderful policy, but it’s deficient in the sense that what we learn is that. We need to go beyond it and to design a curriculum that will permit each society to deal with its historical hurdles. Let me give you an example. Suppose that we take a very diverse society in a diverse society. Part of the difficulty is the issue of social cohesiveness and tolerance. So naturally, we would like the education system from a very early stage to target these particular elements. Naturally, we have limited resources and we would like to target these particular elements in diverse societies. But if we focus, on the other hand, in a very homogeneous society, this will be a waste of resources. In fact, what we need in this society is to emphasize pluralism, to emphasize thinking outside of the box, to emphasize how to challenge the status quo. Well, if you think about cultural traits that we did, we discussed earlier, as we said, cultural traits largely emerge due to a deputation to the geographical surrounding. So suppose that we have some society that resided historically in a place that was not conducive for agricultural investment and did not induce people to plant and harvest. And as a result of it, those individuals historically did not learn how to delay gratification.

And again, the curriculum should focus on how to foster future oriented mindset, how to foster the ability to delay gratification. We do it in the contemporary society by, by either forcing or inducing our children to to learn how to use an instrument where naturally the return is sufficiently large and this is induces a long term orientation and we can do it in different forms. But again, this is education policy. It will be based on the history of the place. Naturally, if you live in a place where future oriented mindset was part of the heritage of the place, this would be a waste of resources. Think about gender equality, as we said earlier. There are certain regions of the world. In which Flow was used relatively early due to the suitability of the land for the use of the plant. And this ultimately generated the division of Labor, where men were engaged in agricultural production due to the physiological advantage in men in carrying this heavy clouds. Now in this type of societies. Focusing on gender equality will be instrumental. So, perhaps surprisingly, the journey of humanity, the book and the reality. Is basically suggesting to us that progressive policies such as gender equality, tolerance and diversity all the key for human prosperity. So typically when we think about progressive policies, we think about them in the context of our moral values. And I’m suggesting here that in this particular instance, in fact, the two coincide, namely those traits or those elements, those policies that are progressive and morally based are the ones that are instrumental for the prosperity of nations across the globe. Thank you very much.

Patricio Goldstein: We’ll have some time for questions, I don’t know if anybody has any questions or comments they would like to make. I can start by reading, if not one of the questions on the Zoom link. So. Here. So I have here a question by phone. And it says with a total knowledge of human, when the total knowledge of human race increases, it takes longer time for one person to learn enough to reach the frontline of research. The average age of Ph.D. graduates, or 30s now will be older in the future. But human lifespan does not increase this fast. As knowledge explosion for fields like physics, it’s become already impossible for one person to understand the development of the whole field. Physicists today usually can only work on limited-scope problems. What’s Professor Galor’s perspective on the limit of humanity’s technological development speed and the relation with a human bodies inherent limit?

Oded Galor: Well, thank you very much. It’s fantastic question. And let me address it a little more broadly. But the question is more broadly whether there are limits to growth. Many argue that in fact, the humanities this is residing at the moment on planet Earth, resources are limited and these resources, this resource limitation is bound ultimately to restrict our ability to grow. And the way that I think about it is a little different. What we learn from human history is that many of the technologies that evolve in the course of human history could not have been anticipated decades earlier and certainly centuries earlier. And therefore, my conjecture. Educated conjecture is not necessarily empirically-based is that, in fact, what we would see in the course of human history is dramatic technological improvements that will allow us in some sense to overcome what we do find this resource-constrained for the foreseeable future. And this is related to the question it was asked here, naturally, when we think about education and technological progress and suggested, I mean, thousands of years ago, people could basically hold the world production possibility frontier in the hands, which is the Diplo and any innovation implied that each individual could make a dent in the world production possibility frontier. Whereas today, naturally, we need to commit perhaps 30 years of our time to reach the frontier and to make a dent. Now, I think that part of the advancement in technology that will occur in the course of the future will be in in allowing us to compress knowledge to learn how to basically transmit the necessary knowledge so as to reach the technological frontier. So naturally, I mean, we do not see in recent years the further and further increase in the number of years of education that are needed to reach the frontier. But if anything, I would expect that future technology will somehow be involved in assuring that knowledge can be compressed. Knowledge can be transmitted in in a much more efficient fashion. And as a result of it, despite the fact that life expectancy at the moment is not increasing, we will be able to sustain technological progress. But beyond that, I think that the change in life expectancy is behind the corner and again, it’s something that is hard to anticipate. But think about it in England. Less than two hundred years ago, life expectancy was 40 in England, OK, and the first country to industrialize the most advanced society at the time. Life expectancy is about 40 and the life expectancy doubled within one hundred and seventy year period in England. So I would have to conjecture. Then we will see a dramatic increase in life expectancy and we will see a dramatic increase in the sort of in the effectiveness of life in a way that will not limit technological progress in the in the foreseeable future. Please.

Guest: Professor, I mean, you had this slide about the deep roots of of development, if we can go back to it again. Yes. Just trying to apply this to modern history, I mean, in 1979, China had one of the lowest GDP per capita in the world. China had an amazing rise and now it’s the second or the first economy in the world, depending on how we measure it. How can we use this to explain the rise of China, for example, as an example?

Oded Galor: Right. So when I think that’s an important question, how do we think about the rise of Europe and now the convergence of China? So. So the way that I would like you to think about it is the following. Initially, if we think about the world, say, India, one cousin, China is dominating the world, the China is sufficiently cohesive and as a result it is technologically advanced and at the same time is not suffering from internal conflict. So when we compare the European continent to to to China, the European continent is characterized by cultural fluidity. One civilization is dominating in one period and another one in another period. We see great mobility. We see fragmentation in terms of nations and ethnic groups, which we don’t see in China. China is socially cohesive. China is, in fact, a quiet, homogeneous in a good sense at the time. And as a result of which China is dominating the world. But then when industrialization is looming in the horizon, in fact, this lack of diversity in China becomes a huge liability in the sense that this homogenization is ultimately preventing the implementation of advanced technologies, the adaptability to the new technological environment. China is imposing on itself a geographical isolation is less subjected to two technologies that are emerging in the frontier and are remaining behind. And consequently, we see that the culturally fluid continent Europe is taking off first, and this is associated with the rise of Europe. And then when we think about China in today’s world, naturally, at a certain point, there is a decision on the part of the of the elite in China that in fact one can combine the autocracy and sort of western type style economic systems. And when this happens, then again, the cohesiveness of the Chinese society is very handy because again, they can produce very effectively, given the fact that many of these technologies where we’re borrowed from from a distance. But again, if I would have to make predictions about how China will evolve, if there will be another technological shift, then again, China will lag behind due to this homogeneity and other societies that are more diverse will take off first.

Patricio Goldstein: We have a Mark Sanders here and who’s asking. The fact that no crisis has yet been able to stop the march of humanity is no guarantee at all that impending crises will not do in the future. We would not be talking about the issue of Ukraine if such crises I don’t have urged or developed. If the crisis spirals into nuclear conflict, we would see a crisis that threatens relentless march of civilization. Climate change as the same potential we have for the first time in history achieved the level of sophistication that can stop the march that got us there. Cannot institutions and cultural evolution move us away from this type of crises until a more sustainable path in time?

Oded Galor: Yes. So I think as they argue throughout, I mean, when we think about the process of development and we think about the fundamental ways of change, they’re interacting with this important forces, some of them are institutional and cultural. And as they suggest that these are precisely the institutions that we that could generate the proper incentives for scientists to develop certain technologies that will overcome potential catastrophes in the context of climate. And this is again the power of innovation that is emerging in the context of the past of the past few centuries. And at the same time, institutions can certainly generate some, some limits to the power of autocrats and ultimately for the capricious behavior that we see in in in the context of Russia and Ukraine at the moment.

Guest: Thank you, Professor, again, for a really fantastic perspective that you shared today. I guess my question is similar to the one in China, which is trying to bring the framework to like a contemporary perspective. And I’m curious, you know, if there’s any additional cases of today’s societies that you think have really identified the challenges that you’ve described today and are making you maybe optimistic in terms of the strategies that you’re pursuing in solving these deeper causes? Are there any countries that you think have somehow identified? Sorry, I was too far away. Were you able to hear most of that or no?

Oded Galor: That’s a very good question, and again, I think that when we think about policymakers and policies in general, they typically tend to lag behind the frontier of research, and I think that this is not an exception. And in this respect, I think that we are still in the process of one policy that fits all societies. One type of institution is one type of cultural traits, regardless of the history that is specific to the evolution of each individual country. So I think that we see some realization. I remember a few years back I lectured at a forum of the Korean government, and I spoke about issues related to diversity, and they were very receptive to it. And to a large extent, they are considering it quite quite intensely. Do I see this policies being implemented in a significant fashion? Not yet. But as I said again, if I learn from history, it appears that policymakers will adopt this type of policies in in the near future, but not in a pronounced way at the moment. Thank you very much.

Guest: Thank you, professor. I wanted to ask about like that lately that globalization migratory flows have changed a little bit. The distribution of like diversity among black places in the world. And I just wanted to ask, have you seen evidence that places that have been like that accepted more migrants? And I mean, at the end, I take it a little bit like being more accepting to it or the other way if people or countries that were to like to play are like not accepting a lot of migrants. Is that helping them to grow better or to develop better institutions?

Oded Galor Certainly, if we think about it in the context of sort of the past 500 years. So I think that the prosperity of the United States is largely due to the fact that the diversity was created here in some sense out of the blue, in the sense that the initial population in the in the place was relatively homogeneous and ultimately diversity was introduced by different migratory streams from different corners of the world. And as I told you empirically, it appears that there was a shift in the optimal level of diversity from one that existed in the year 50 100 to the one that exists today, namely the level of diversity conducive to development moved into societies that are significantly more diverse, like the United States. So if we think about immigration policy in this context, I can certainly I mean, so naturally, when we think about immigration, part of the difficulty is that it takes migrants a certain period of time to be assimilated by the long-run benefits based on human history, pronouns and as they say, we see them, we see them in the sense that the societies that are more prosperous say in Latin America, Brazil, et cetera, a society that tend to be much more homogeneous than society is much more heterogeneous than a society like the Malaysian one or the Peruvian one.

Patricio Goldstein: Well, I wanted to think since we’ve run out of time, I wanted to thank Professor Galor for his wonderful presentation and I wanted to thank everyone on you for attending today’s events. Please, you can go to Harvard Coop or the Harvard Bookstore or online and purchase Professor Galor’s book and get to know the entire argument over our book. And again, thank you so much for the presentation. I hope to see you at the next event.

DISCLAIMER: This webinar transcript was loosely edited and there may be inaccuracies. 

Tim O’Brien: Well, everyone, welcome to the Development Talk series. My name is Tim O’Brien, I’m a senior manager of applied research at the Growth Lab at the Harvard Kennedy School. I’ll be moderating this session called A New Agenda for African Continental Integration with Dr. Donald Kaberuka, former president of the African Development Bank. Dr. Kaberuka, welcome and thank you for joining us. So the first question I have for you is simply about the current state of growth in Africa. For many African nations, growth remains low in 2021, and current IMF and other forecasts don’t project Africa as a whole to converge to its pre-COVID growth path and like many other regions. Can you talk to us about Africa today in the context of the pandemic? Do you think African economies have begun to recover from the COVID 19 crisis?

Dr. Kaberuka: OK, thank you. Thank you for the opportunity to share and apologize for the lights. As I said, I’m in Brussels. (Inaudible) Look, let me make two caveats, number one. Africa’s 65 countries. And therefore, you have a whole variety of post-Covid recovery, depending upon a number of things. And so as he spoke about African recovery. Please bear in mind that I think to help countries and that would be different positions. And I suspect the recovery would be, but it is a number of countries with. The second caveat is that we cannot explain everything on Covid. In some cases, though, some preexisting vulnerabilities caused by internal or external factors. So it’s going to be that things be happening in the next year. So this was my second. Now why do I say this? I’m saying this because I’m still confident that men of our countries are going to occur, but it will be a recovery. Which is probably is variable. It was in busts, I think some countries do better than others. And depending upon four factors. Fucking no one. The path of this let us. Shall we see another body? Let us know unless. I see that European countries are beginning to open up their economies to eliminate all these measures in the belief that maybe Omicron would be another variant. So that is issue number one issue number two would be gradual vaccination. Which, you know, in what you call Africa, is there a lot less than 10 percent? Now, some countries, including my own right on targets, WTO targets, but many other countries are building. So that could be the second, but. The third factor would be what does that mean to the global economy? And at the moment, a number of things are really impacting on the recovery path in all of them. You won’t be surprised. It is a pleasure. Isolations the world over was struggling with supply chains and maybe less risk of inflation. I don’t. And then the last one is the multilateral action, because we saw during the acute phase of COVID a little disjointed and not robust responses to what happened the economies, the global north, where trillions of dollars of stimulus, many of our countries don’t have medical students. They did what they could, but I won’t say the international response to music it with exception, I would say, of the International Monetary Fund that institutions like the Global Fund to see a much more robust action going forward so that that would be a synchronized recovery or simply recovering the North, but recovery in the global south as well.

Tim O’Brien: Can you tell us a little bit more about what more robust effort would look like? I know that early in the pandemic, you argued with others for the need for debt relief in Africa. Do you think debt relief is still needed? What’s the economic case for debt relief or what are the broader ways that the multilateral response can be more robust?

Dr. Kaberuka: Let me let me qualify that. What was requested for and was delivered by the G-20 was not released. And suits the conservation standards, too. It was a moratorium, a moratorium which was a voluntary and temporary. It was understood that after the acute phase of these other countries to begin again to fulfill their responsibilities, many countries, by the way, do not take up the monetary. Because they were keen to ensure that is part of the recovery process, they need to have access to global capital markets. And you and I know that some rating agencies had no take and done little the initiative of the monetary office, let alone there, was no comparison. I covered all of the criticism. So, no, we never could definitively will call for it to seal a moratorium, which is a temporary and voluntary. Now, I want to emphasize that I did a number of countries who have issues that in this distress over the marginal districts. But it was not exactly linked to the event of those preexisting equipment, COVID evidently worsens the situation. And therefore, the solution there may include some of the Europe deputy secretary, but there was still a lot of reform in policy and policy reforms. These things have to go together. But you asked me what the robust action could be. I give you one which has been at the table for 18 months now with a little movement on the issue of the special drawing rights. The reserve assets of the International Monetary Fund. You recall this during the global financial crisis. A decision was made to increase the level of special drawing rights from around twenty four billion dollars close to 250 billion dollars. Very robust build a robust. This time around, for somebody of equal measure, now it is You know second to increase the special drawing rights. About 650 videos equivalent. But as you know, because of the way the the regulations work, that’s going to be about a billion dollars, by the way, a large part of which was the middle income countries. So the majority of countries and smaller economies who would have it a little in terms of the estimates. And it is a proposal is being put on the table by the different parties to say there would be a lot of countries in the G20 who don’t need those serious. We don’t need them. That a part of those is recycled. But the mechanisms to be discussed to those countries, we need them. That would be a very bold decision, which is not technically difficult. There are some legal issues, but it’s not the political will to say there’s been this decision of the special drawing rights, but it is benefiting countries. What it does is it does recycle at least 200 billion dollars to low-income countries in low and middle-income countries to assist the recovery. Those kind of measures would be quite sensitive.

Tim O’Brien: And what about any other actions from other multilaterals? And what about the African Development Bank itself? What roles do you see from the other major institutions?

Dr. Kaberuka: So Regional Development Banks play a delicate role. They have knowledge on the ground. They have done quite a lot in assisting countries in this period. But, you know, also the cost of this is not the resource. This is not commensurate with the size of this crisis. So but the arguments on this zero, this is that, as you said, would via Africa’s development assistance not the only ones, but the largest, not at least to the African Development Bank. And that’s why I hope and expect that some decision in that direction will be taken.

Tim O’Brien: Great. Let’s turn a little bit to the topic of the session on African Continental Integration. But I think that’ll bring us back to some of the other components of recovery that you mentioned already. So as the global economy changes now the aftermath of COVID 19, supply chain issues, but also the move toward decarbonization, what’s the specific capabilities for global competitiveness that you see emerging through African integration? I guess including, but not limited to through the African Continental Free Trade Area.

Dr. Kaberuka: So let me explain the logic of the contents of the search for. It’s about deepening Africa’s markets. It’s about extending the diversity of those markets. Some economies are very small, small economies, kind of Crystal, but I think is in other parts of the world. The decision to come together, removing barriers to trade and investment is quite salutary. In order to see going into the next expenditure, you know, there are several stages of integration. They’ll always see one is known as a preferential trade area. You see tariffs among members, but you don’t completely eliminate the next one is a free trade where you remove trade barriers among the members. All right. You can move onto the customs union have with the next democratic move on to the monetary union and even the later full economic you know, including as such, now many Afghan regions have moved beyond the free trade in it. Some of them are common currency. Others have customs union other than monetary union, and therefore the African Continental Free Trade Area brings credence among all the five regions of those. Are the early stages like the preferential trade areas, those are moved to the United States, like the monetary union, one of the building or not. What building on something that exists. But none of it is between us, between the regions. And we know that tariffs are no longer the biggest problem. The weighted average among men of their countries today would be in the neighborhood of 15 percent. But the rebels say things like the payment systems and movement of people and obviously where markets a lot of men set off restrictions, which you know very well. And the idea is it’s in this be few. It’s going to move quickly to hopefully liberalization, which is preventable and including measures to safeguard those sectors which might be having some temporary concerns. You know, for example, today delayed one countries to sign it once the new issue of rules of origin issues of anti-dumping measures. The standard things you have to deal with in this kind of. And my hope and expectation is that quickly we get all these things in place. All right. Some more disco than others. A movement of people is very difficult, not simple enough for the world. But the low-hanging fruit is we launched about a month ago in April, the pan-African payment system, which is owned by the African in particular, but a hugely important step which enabled filling in national currencies without going initially to say the currencies. I hope and expect you can make progress, for example, on the premise systems and digital platforms. I’m hoping we can make progress on the single market, which would never bring down that was the trouble in Africa. Don Bowles put it this, so it’s a question is never is whether it is in Europe, as you can see for other parts of the world. It’s it was a lot of give and take, but at the end of the day, it will benefit. And so the single logic of this CAFTA is that it provides resilience with the Afghan economy needs six. And also in a quest to get investment from other parts of the world.

Tim O’Brien: One, I wanted to ask you more about this, last point of investments from other parts of the world. What’s your hope in some of the sectors that are likely to emerge or trade relationships that are likely to become more promising? What’s the nature of the types of investment that you hope that that integration can enable? And is it investment that then produces things that are sold to this larger, more integrated African market that then certain countries have had access to before? Or is it also about producing things in Africa that are then sold to the rest of the world? What’s some of the scope of possibility that’s in your mind?

Dr. Kaberuka: So Tim, you and I know this. Intra-African investment flows themselves are very, very poor. But many companies of African origin, African ownership, which have cross borders so badly that it encourages intra-Afghan investment itself. All right. This is important is affecting it for investment. You know, the second thing you and I know is that a. A lot of investments over the last five years in the many parts of Africa was going to mining oil and gas with the kind of stuff. All right. Now, that means it’s going to be subject to vagaries organization in which the booms and busts. Right. So wait for it. The tricky issue is how do we join the global value chains at high levels? Was that not many economies operating at lower levels of the global village? This were the issues that. No, it could be the diesel space. It could be an ugly business. It’s going to be in the consumer industry. It’s going to be the health scare, but we have to be able to move up the global village. Now, it was beginning to happen in a number of countries, right, especially Indonesia. But now, as you can see, it could be itself as a look at some thinking around what we do is vexing my focusing my Fuxing Therapeutics diagnostics now for the continent, which in 20 foot would be quite a powerhouse demographic because it cannot be, it would not become part and parcel of the high levels of the global value chains. Those are the kind of business I’m talking about. It takes a number of things. It takes stability. You take security, it takes, kills, it takes the policy penalties in place. All those things are within the safety. And I am completely convinced that given up the megatrends, the demographics, the urbanization, the leapfrogging in some of these deviations in Africa will be once the safety is bliss, where the power to reckon with everything in terms of sequences will get.

Tim O’Brien: So, so that brings us to the obvious follow-up questions of what are some of the risks and constraints to these initial building blocks of the FDA being completed and put in place? What are some of the challenges that you see there need to be overcome for this powerhouse future?

Dr. Kaberuka: Look at how long it is taking the Europeans to get right. They begin to do a with their European coal and steel arrangements. They’re moving into the digital realm, getting the economic community. Democrats must act and then rescinded the Treaty of Lisbon. But not all European countries belong to the European Union. Some in the Europe Union, others and the Union of Media. OK, and there are the kind of arrangements as other European countries, including the Free Trade Area, by the way, as you see, it’s quite a long journey. Complicated economies are different. They have to be taken into account. They’ve always been a little zero-sum calculus as well. There’d be some fears to overcome. But whether it is Latin America, whether it is Europe, whether it is Asian, integration is the general, which is complex, we should not be. We should not underestimate the challenges that we face, especially when you talk about countries. I can look at how wrong it is in Europe. Look at the challenges that you know, even today. And therefore, I think building on what is the nominee in different parts of Africa, really in East Africa,  in SADC, especially those SADC, it was itself kind of a community where significant steps have been taken up. The customs union up to the monetary union of some countries was. So which is really what exists already, but not underestimating the challenges with this.

Tim O’Brien: And how about challenges in particular to some of the low-hanging fruit that you mentioned before payment systems, air travel mobility? What are some of the more immediate hurdles to get past there?

Dr. Kaberuka: So I mentioned the scheme, which a number of finance institutions have begun that are doing others in the first he took was good preparation. It’s not easy, especially because different regions put in different arrangements of opinions and settlements. And therefore, it is one of these continental building skill-building what exists. So that takes it to the bank then that issues like the deprivation email that we all kind of need to get all the kids together. There’s some school and policy issues which have to be addressed. What I’m telling you is that our central banks, different public institutions, and I wasn’t being too hard on these issues, and I was impressed by how fight is going in such a short period of time. Just imagine three up in countries with different currencies. Consider opinions in real time using on currencies through the arrangements, but that’s not going to save money. It will not only seem the need to go through all this, but over time it would even bring the informal trade into marriages, which, by the way, submitted to the. So even bring an informal fit into the formal structures, that’s still a huge addition for the major foundations. So they low hanging fruit, but I’m not saying they’re easy to operate on day one.

Tim O’Brien: In terms of mobility, not only of people but also of goods. How about transportation gaps, infrastructure gaps? What are the key gaps that relate to the fulfillment of the goals of integration? How should we be thinking about those issues?

Dr. Kaberuka: Look, infrastructure isn’t for the challenge because it costs money, but I won’t tell you that the spending that’s going to build, I saw huge progress in all regions of Oaxaca, maybe except to the Manresa area and maybe some places in the mountains. But other parts of Africa, when they do with it, is for transport, for power, for about optics or this that improved dramatically bring down the cost of the business. It would. No, that will continue. But I mentioned a single earmark. Go see where market does not require a lot of it. But those efforts exist, but our planes applied to them using different levels of freedom is in the agreement. So there are some things it doesn’t require a lot of effort, but any video feeds to. If today it was agreed that the power approves, which you know very well, what do you think is not only possible for kinds of energy security, but the chances that to bring down is in the process? And this is about infrastructure that is more than investments. It is about the police of criminals. It’s about the financial capability of the national figures. It’s about regulation. It’s about that is how it ends the subsidy. So many things we can do in the policy space or off with weaponry. They had the infrastructure. And again, I want to mention that I think a lot of this happened to me, and I’m certain that in the context of the free trade area, we’re going to need to do more.

Tim O’Brien: And can you tell us a little bit about the key roles are that the African Development Bank plays in this project? So you mentioned your time briefly in relation to infrastructure? What are some of the key roles?

Dr. Kaberuka: Look, it’s a long time ago I left the African Development Bank so I can’t speak for the institution. I don’t have the mandate, but I can speak as a former leader of that institution because it’s going to play a very important role in the space of bringing down the cost of doing business in Africa and bring down the cost of doing business in this region. Institutions are very, very close. And that’s going to be the bank has built itself for this place. And I hope that its shareholders continue to associate it did more so that the African people with subregional development assistance remember the occasion of the African Development Bank, which was the colonial powers lift of 55 countries, but several currencies, borders and and the political decision. It is a be complicated to open up the Pandora’s box of those borders. Well, it was accelerating federation. There are the great institutions which can bring down the cost of doing business. Spain is a great open and I want to salute the forefathers of organizations for that kind of person that will continue during this crisis. Some of the organization studied have been physicians. Visiting clubs have been asking organizations African Center for Disease Control State Laboratories, now the creation of the African Medicines Agency. That’s kind of a decision. But senior positions in all of this under the umbrella of the upcoming union that’s gunning these Afghan institutions that are quite a simple stuff can develop advanced African Export-Import Bank, African CDC, the earbuds, the medicine agency in the context of this governmental free trade area, which I need those institutions to be strong, robust and resilient.

Tim O’Brien: So what about the potential losers of integration? I mean, there’s a lot of benefits that you’ve laid out. But with trade, the trade component, at least there’s always some winners or losers. How do you think about that and how do you think about ensuring that those who those businesses or otherwise who might be harmed, transform and benefit as well?

Dr. Kaberuka: Look, well, I don’t like the term winners and losers, everybody, everybody’s a winner. It is zero-sum calculus. Is it on calculus? Everybody’s a winner. No, I’m not talking about that. Every single sector, every single enterprise win within some enterprises, which operates inefficiently, but we cannot compete as input. So mixed up. OK, that would be with it. OK. That means some business now up to the idea that is a normal process of right? No. The CFD does not have 100 percent. It is a sequence liberalization recognizing some of those designations. Providing for. If they organize those, the suctioning and the very strong anti-dumping measures because of fears by some countries that certify the exports and actually end up in their countries, undermining their own industries. But I do believe this experience has proven that even within Africa, not even within the community, there is no reason everybody is a winner. All right. Rabbi, we agree on the sequencing, timing and his images.

Tim O’Brien: I’d like to ask you, just were you surprised at the level of support and unanimity in You know unity across African nations in regards to AfCFTA? I mean it. It struck me as unique in how many countries have signed on. Did that surprise you?

Dr. Kaberuka: No, it surprised me. It was in a sense that the leadership of one, the countries I’d been waiting for such measures is, I would say, many regions are going even farther than the free trade area that the customs union, that monetary union, the economic union that wouldn’t even know they should bring grievance among the regions of some at the beginning. Others, much say. But I do not see any hesitation. I just saw some countries wanting to have clarity on some of the risks which you just mentioned how it goes up versus how the was different political, the voters on the rules of origin or not dumping on it because it was breaking the rules. Some of the things ones that have been explained right? All countries able to find except one, I believe.

Tim O’Brien: Great. So I think we’re going to turn to participant questions soon. I wanted to pick up on vaccination again. You had mentioned it a little bit. You mentioned a little bit about vaccine manufacturing and your initial responses about COVID 19. One of the key pathways forward. Can you talk a little bit more about the vaccination challenge in Africa and other developing countries, how two systems need to improve globally locally? Help us understand this challenge a little better.

Dr. Kaberuka: So let’s begin with the challenge of doing this symbol. Is that science and the private sector provide a solution? In terms of vaccines, in terms of deftness, in terms of therapeutics, but in rich countries, they to. So to speak. Beyond even then, it’s. In private, companies were more keen to fulfill those orders and commitments than make sure the vaccines were equitable. All right. The situation has improved, but not is one would need to deploy the vaccines to the level needed. I really want to feel that when it comes to issues of justice, the refugees export bans hoarding by these countries, right, did not help. Those of us who believe in free trade. I do believe that we have not learned from this lesson, but that when there’s a crisis, right? Global systems don’t work happens. And therefore, it is only normal that countries look at making a significant level of therapeutics, diagnostics and vaccine. Right now it’s not is. It’s complicated. The technologies is setting them up. But you see countries like Senegal, Rwanda, South Africa, Tunisia, Ghana out. In the beginning, we can see this new technologies not simply with vaccines, but for other forms of vaccine India. Again, the free trade area really provides a very good base to do that. Was Missouri able to get these vaccines in testing them among themselves and regretful? And then it’s inefficient. These things are the beginning if countries are working with different. It’s a technology that in the issue of intellectual property rights, which is also a discussion that are in different arrangements pending when that kind of which is resolved. But it cannot be this in the future. And there will be that African countries face the same problem that this this type of almost becoming the last mile of vaccination.

Tim O’Brien: I want to ask you just one more question, then we’ll turn to all the questions that are coming in through the Q&A and keep them coming, and that’s on in your role as U.N. Secretary General’s high-level panel on internal displacement. You know, it’s clear that African integration can be an enabler to solving so many problems economic and otherwise public health. Is there a connection here with the challenges of internally displaced people? And if not, what are some things that are at the forefront of the UN on addressing internal displacement?

Dr. Kaberuka: OK. So when the Sec. General asked me and it didn’t get any for my EU High Representative for Foreign Affairs, which had to be sorted, said No. One. The numbers of internally displaced in the world that the historical high. A total of 17 million people. That is high. And let me also emphasize this is an internally displaced, this is still in their own countries that move across borders. They’ve insisted that because of conflicts or because of climate or because of both. But they’re still within their borders. They’re not refugees that would cross a border. So the second reason see, the mission was that even though the numbers of, I don’t know, it’s pretty high. The world is not giving it enough attention is the issue of refugees and illegal migrants, which of course, is both. But there are protocols and international treaties on how you deal with the refugees. But there’s no such a thing to do with intelligence, this business. So number one, the number that is why. No deal. The issue is not receding at and when it does receive attention. Is this solicitation from the Department of Humanitarian Possibilities assistance? Not as a development issue. And therefore, one has to give it both a mandate and say a development site and integrity was in thinking about what it means for the system, would government we give a proposal to the opposition, which is study I think is a hugely with additions from countries, but it is Colombia from countries. But it is the Philippines, from Myanmar, from Syria, from Yemen, from the Syrian region and from some countries in the Gridley. So it’s an issue of huge importance globally, not simply for low-income countries. And I do believe that the proposals would give to the general on how to ensure the intelligence business comes back on again. Right. It is the one of refugees and migrants. And second, that it is looked at from the viewpoint of governments and conflicts and also from the viewpoint of development and humanitarian needs. So it’s up to six you know now to get the information for. But I do believe that in 2022, unless we begin to focus on the issues of IGP, as I said, this is what it is. Colombia is Haiti, Yemen, Syria, Afghanistan, Philippines. It is very hard, but Cuba is use in some of those countries.

Tim O’Brien: Thank you for that. So I see that Ricardo has joined now, so let me hand the floor over to him for as many questions as he’d like to ask.

Ricardo Hausmann: Welcome, Donald to this group. It’s great that you’re doing this for us. Thank you very much for your wisdom and your friendship all these years. I want to start with a brief comment and ask you a question on that. I think that whenever African countries, whether it’s because of an export boom, more or aid or an ability to borrow whenever sort of like a foreign exchange constraint gets lifted it has capacity to grow. And whenever the foreign exchange constraint binds again, then things slow down. You mentioned the word leapfrogging. I want to see, given your experience and your knowledge of the region and what you think is happening. What are the most promising opportunities that are there that you think countries should get organized to exploit out there? There’s obviously a, you know, decarbonization is, is, is a challenge, but it may open opportunities, digitalization in other things. You mentioned urbanization, demographic change. What are in your mind in the best cards that countries in the region have right now to play in terms of our growth agenda?

Dr. Kaberuka: Ricardo, thank you very much for their kind words. But together, it’s hard to explain this to you because you explain very well in your schools isn’t how about your students? And when your complexity issues and what these economies have to balance, it’s no wonder you write about our economies having been basically subject to booms and busts in cycles. That is it. However, I wondered if you recall, that’s just because it’s a particular before the global financial crisis. Some of the fastest-growing economies in Africa were not competitive. In fact, when you look at numbers side by side. The fastest-growing economies, I should add a little bit in terms of oil, gas and minerals. Well, those risks in those subsoil possibilities. Hugely volatile growth over the years. This is, as you said to me, something that if you look at the structure of the growth of those countries of origin, it was interesting to see how they are related to the megatrends happening in Africa, which is demographically Dunham’s young population. Second, population moving from rural areas, urban areas. Which means the demand for literally everything in a new format. And certainly this issue of input of simple technologies like the mobile. What does Mitt in terms of inclusion, which does mean terms of delivery of citizens in my country? It does made a huge difference, for example, in health the delivery. So I believe what you see, what are the mega trends in Africa in the next four individuals? And these are some of those I’ve mentioned and what they mean in terms of training skills development so that it can provide the response to the U.S. mission to which are principally the green economy, right? The green economy. We don’t know what to do to cities like this in the past. We have to make sure it’s a given that Africa together literally Billericay really in its services. So this is that Africa is rich in some of the commodities. Would you be critical in this transition to electric vehicles and stuff like that that we managed this? This is different from what I’ve done in the past. So I think that we have many missions, the green economy and these are absolutely right. But it means that this in what it takes, if that happens next time you visit my country to be able to see the investment the country’s made for a good investment, good regulations. Training people is what is making the country able to attract better players in the abilities of the diesel face. So you might have to agree that the green economy and the needs of its.

Ricardo Hausmann: Thank you. And let me return it back to Tim O’Brien.

Tim O’Brien: Thank you. OK, so there are a lot of great questions in the Q&A, so I’ll just go through as many as we have time for. So let me first read one from Daniel Ofosu, who’s a mid-career MBA at the Kennedy School. And his question is to what extent do you think historic national borders have contributed to the slow growth of intra-African trade? Going forward, do you believe that the CAFTA has the requisite enforcement power to ensure that African economic regions cooperate fairly on trade issues?

Dr. Kaberuka: No, the fragmentation of our economies and notes that have been in a break on with bits of growth diagnostic. No doubt about. I’m not saying that large economies in Africa have done better than what they call fulfillment, but some of the large economies have done it over a long period of time, if not better than smaller economies, but could have done better things together. And this I’m saying that’s when you look at parts of Africa which have been moving up steadily on the ladder of integration. Tough enough for me, right? The rate of growth in the subcontinent is much, much higher than, say, in central Africa or New Mexico. This is a great. In the North African country’s economic trade is about less than maybe seven percent or even lower than the simple some parts of Zimbabwe. So you could see the link between countries, a move that has high up in population and the impact on economic growth. But would it be easy? No, not at all. Because of the records of ethical and sometimes political questions. Is it enough? So the answer is yes. Fragmentation of government equals. We need to be to work on it. I think this is a very good starting point.

Tim O’Brien: OK, next question comes from Jasmine Hugo, who is a graduate student at Cornell and I believe of Ethiopian descent, which is one country that’s not participating in Vasey, and her question is about regional economic communities. She says, Thank you for this informative talk. What will happen to the existing regional economic communities and other African regional trading agreements under AfCFTA?

Dr. Kaberuka: OK. So for a long time, we’ve suffered this thing we call the spaghetti bowls of. Appreciate you funding every country, maybe some kind college, more than one, two, three, four economic configurations. One of the beauties of the city that killed cities over this and for this book was harmonizing regulations. When I was in college, these etc. So I think the city’s answer to these spaghetti bowls I can having several organizations, those with severe neighbors, especially countries like mine, which no, you have to get on to organizations where all your neighbors belong to. So that is the answer. Now what will happen to those organizations? The CFD doesn’t mean that existing organizations should be rebuilt, so the country-specific builds on existing institutions. And it was. It’s where they are moving it further than this year, a trend that is accelerated further. So some institutions in the long run, in the long run, it may evolve in different directions. But the idea of this shift is not to scrap existing institutions is to build on the.

Tim O’Brien: I have another question here that asks about the relationship of integrated, more integrated Africa with the rest of the world, and that’s from Noah A. Should the AfCFTA prioritize working towards a continent-to-continent free trade agreement with the EU or focus on intra-African opportunities? He also asked, what should we expect from the Brussels summit?

Dr. Kaberuka: Oh, that’s interesting. Yes. Yeah. No. You know, look at the history of other parts of the world. Look at the history of Europe, it’s a threat at all twice in the last century. But once the war Second World War was over, the Europeans said, let’s look for other ways of working together. So beginning with the two countries, which when the steel and coal community, then the EEC, and then after the Treaty of Lisbon and they it’s a good thing for the countries, the source of the in the East and Europe. No, it has not been easy for them. No one says it will be for that, but this inflated needs priority for Afghan country is to build the continental markets. Its diversity is the movement of capital, of labor, of services as much as we can. That is what makes African countries able to defend external shocks. Is it to negotiate better treaties, arrangements with other parts of the world? If you have to look at the debate about EPAs with the EU economic partnership agreements and the confusion that it creates, i.e. exports of Africa, negotiating a separate agreement with the EU didn’t work very well either, because it does not bring to this logic. So the logic now is let us open up the rest of the world, but let us this will open up among ourselves deep in our markets. I love this regulation of facts and then negotiate with other parts of the world is one of possible because that too is very important.

Tim O’Brien: Another question from Bruno S. is what role should universities and research and development play in the African Union’s economic development? And Bruno is a student at the Harvard Extension School.

Dr. Kaberuka: So let’s talk about education as a whole, not simply universities. And then we can talk about that and talk about intellectual property and business. You know, since you are a student on those issues, I want to look at the development of the prisons in the world. We have the design system in China alone in the last two years. And try to link that to the level of investments in education, both at home and abroad. But it. Some of these success countries realize that it’s not hard enough, but leaders of its good Vermont also invest, and then they just get educated abroad, bring back the skills and the networks they have. Now, I do believe the key issue in our system of education will be the quality that exists. Was we have done better in putting a rising number of children at school, girls and boys, increasing the number of universities? It is a number of taking dozens, but it’s vitally important not work on issues of ensuring that equality that exists is what exactly would enable us to get into the R&D space and everything that is the post-industrial vision from nanotechnology to big data. This is about for me providing this opportunity for all children. What school? Good school? And at the end of it is running. By the time when they leave an exit, they have the skills that are required for the economies of the future. This is how I see things from this.

Tim O’Brien: If I could build on the question a little bit, we think a lot about the interactions between universities, research universities and the industries that are around them and the role that universities play in the basic R&D that then feeds those industries and the interplay between the two. From that perspective, what do you think about the. What do you think about those type of relationships in across Africa? Are they are they growing in some places? What’s the role of universities in this in the future of African integration in?

Dr. Kaberuka: So whether it’s through head to listen to this, universities, polytechnics and institutions which provide skills of the people, we’re not investing enough. In other words, you know, you and I know that out of India, around the world, these subsidies open in different forms, including subsidies given to universities. And therefore, it would be like. But the question. That’s the key issue is the it’s really important that it exists, and that means investing in the quality of education that kids get at school and in the universities. And along the way, figuring out a way to combine public money and private money, ensure that we invest more in R&D. I mean, at the moment, outside of Africa and Morocco, the level of invest in R&D. And this requires the public money, public money. And of course, the institutions of higher learning as well.

Tim O’Brien: We are in the process here. I’m speaking to you from a university in the United States of always in the countries where we work, trying to engage more with the universities located there and in more collaborative ways of researching especially the questions that are that matter more to local researchers. Have you seen some promising models of this type of relationship between global universities and local university cities? What are your thoughts in this area?

Dr. Kaberuka: For example, here in my own country, Rwanda, there is an interesting model. Actually, two. One at the Carnegie Mellon University, which opened a campus together and provides master’s degrees to in the area, and they’ve done a bit of it. You know, that is a kind of cooperation which shows results is African Leadership University. This is the Afghan Institute of Mathematics. So, yes, there are possibilities of having those centers of excellence combining. But for me, the acid test is how well that works to build local capacities in Africa, because remember, this is the pulling. No. If you’d fancy an expense in an Afghan country that makes maybe because you got maybe $6000. And to some Western countries, then maybe the foot doesn’t. If you send them to America or Europe, you may end up being 20 times. Which means a country is against them, and therefore the key would be how quickly can build the capacity that will going to get more people into the had anything similar. But if that happens by indigenous growth, it’s better if it happens by cooperating with external intrusions. That is also what is developed.

Tim O’Brien: Thank you. So I have a few different questions here about the relationship between the FDA and agriculture in particular. One question is about how the agreement will affect domestic agriculture and how to ensure adequate protection for farmers in competitive markets. Another question is actually asking about how the EU has a common agricultural policy and that that’s played a role in integration in the EU. Do you speak a little bit about the particular role that agriculture plays and how integration affects agriculture? Look.

Dr. Kaberuka: Who can do this with? Them in the thoughts above. Do you find that? Let’s be with him. Is it worth it a minute from this like Vietnam? In other parts, the fine features imported from China. In many of the parts, you find the still important things from European countries. What? Alison Kosik, he was the bureau because the subsidies. So part of the solution. As come from an agreement that we deliver on market distorting agricultural subsidies. That’s not to provide opportunities for us, Gantt chart. It’s really not is this this deal for this important role for them? If you’re in the Mississippi and Alabama. Let us discuss. Is that something they should be doing in this entry? The European Council will be subsidizing their farmers at the Riverside Stadium. Maybe the safety was necessary in the 70s, but you see this is said enough. So there are those issues in the global agricultural policy, which is a necessary complement. What we do nothing. But I do believe that the shift is very good news for African families into a critical new stuff can come with any protection. Andres Velasco There might be some temporary system improvements, which, by the way, is provided for in the safety net. But overall, I think the more open our markets up to all our farmers so that farmers and country consider Peru B and C and D, and not simply a true liberal, by the way, but also a value added. So I buy the thesis that I fully see if this is the best news for Afghanistan once the long time provided, provided those distortions in the global markets are dealt with as.

Tim O’Brien: I have a rather specific question here from Sonya Turley, which which is would you support the inclusion of the African Union in the G20, given that the EU is also the member? Would that help to increase the legitimacy of both EU internally and externally?

Dr. Kaberuka: So is it right? That’s a continent’s lack of figure was left out of the discussions about the future of the world that it was. I happen to have attended the first G20 in London, followed by Prime Minister Gordon Brown, and because everybody realized the injustice of this. It was on to ensure that it’s some voice from the Afghan side. So, so that’s the puzzles that it’s hard. It is a large economy, but it was bombed. You that the African Union, the the Shia Fiscal Union, also attends but is against. Equally, the head of the president who chairs the Independent, the Freedom Dividend Program. But these are evil arrangements. It is important to formulate. So that when it all goes and is it further conflict, Bangladesh should be out given its population weight? So maybe we should think of other informal arrangements. That is so many since 1945, that was the G7, the G7 plus one G8 in the G20. And we have found the combined effectiveness and legitimacy. At the beginning, the G20 was probably very effective at minimizing the damage posed by the global financial crisis, but its legitimacy questioned by those of us what it’s done. So would I call for inclusion, but hopefully to make current arrangements a binding, not simply voting you is guests. They find a way of putting more countries there. Be concerned that more countries will be less effective decision making. But I don’t think even the current arrangements, a number of decisions have been difficult to implement. But in spite of the fact that there are only 20 countries who control 80 percent of the global economy, I think ability to want to find the sweet spot between effectiveness and legitimacy is very fundamental.

Tim O’Brien: Well, it’s been a real privilege to to hear your answers to all of these questions, you’ve been able to answer everything thrown at you, it quite quickly and compellingly. So I just want to leave the last few minutes. If you’d like for you to share any any thoughts that you’d like to leave us with anything that you wish we be asked about. It’s like to have the last word to you.

Dr. Kaberuka: All I want to say, Well, we begin by thanking you, but also saying that without the present. Reference represents the fifth one is how badly the world is prepared to deal with this kind of. It’s the money we almost based on of HIV aids. You and I know that because AIDS has been in the global north almost as it is in 1995. Deliver mortality from that particular, and then it’s big enough, OK? But drugs which would have been had to do with HIV aids in the Renaissance became available at the price of food, one that you will find in this place and in the region and found between classes last second. And therefore, we need to think about this pandemic because this pandemic was life. But as. Dealt a blow to the economies of many low income countries, even those not. Now that we are the better the future, that would be the other epidemics. But if you don’t always come under epidemics, become a race because of failures in governance. Or is it politics? I do believe that the biggest economy what’s in this going forward is how to prepare for the next pandemic in a manner which is effective. And if we don’t solve it to address global health security both for the governments in the global south with the kind of responses now we have huge levels of global inequity and that has been damaging for the economies. And this is what we’re discussing.

Tim O’Brien: OK, well, I want to thank you on behalf of the growth lab and everyone who tuned in, and this has been a wonderful chance to learn a community about the possibilities of African integration and various other issues. And I see that it’s gotten dark over there, so we’ll let you go and always appreciate your time and your wisdom. Thank you.

Dr. Kaberuka: Thank you very much. Thank you very much. Thank you for your time.

DISCLAIMER: This webinar transcript was loosely edited and there may be inaccuracies. 

Miguel Santos Let me first welcome everyone to the Development Talks of the Harvard Growth Lab. My name’s Miguel Santos, director of Applied Research at the Growth Lab and I have the honor today to moderate this session called Confronting Post-COVID-19 Macroeconomic Challenges, which is something that my guest today has been doing for some time now. Ipumbu Shiimi, Minister of Finance of Namibia. We’re very happy to have him today with us. He’s been the Minister of Finance of Namibia since 2020. Before that, he served as governor of the Bank of Namibia for from 2010 to 2020 after a long career at the bank. He holds a Master of Science Degree in Financial Economics and a Postgraduate Diploma in Economic from the University of London. And he also holds a diploma in Foreign Trade and Management from Maastricht School of Management in the Netherlands and an honors degree in economics of the University of Western Cape in South Africa. He’s also a Bachelor in Commerce, Economics, and Accounting at the University of the Western Cape. Before we start, the Growth Lab has had the pleasure of been working with the government of Namibia for 1.5 years and a half, so we agreed that I’ll make before a first very short presentation to get everybody up to date with the situation in Namibia and the challenges the country is facing. And then we’ll go. We are going to take it directly with the minister so far. I mean, Namibia, it’s as many of you are aware, Namibia. It’s a country that had gone from a colony in 1989 to a functioning, fully functioning democracy, as we can see here. The other country that went from colony to independence in this period is Eritrea. The country has been working since independence to strengthen its state, so state fragility indexes are going down, which in this chart mean are improving. These are the things economists don’t. So I say fragility is going down, so the country is becoming stronger, stronger than. The state capacity has evolved significantly. Namibia enjoys a very fast growth acceleration period for 15 years since 2000 to 2015. That was driven by investments associated to natural resources within the context of the supercycle of commodities. The country grew to income per capita 58 percent in those 15 years, growing at a compounded annual growth rate of 3.4 per year. And he was not all. It was not all the boom in commodities. The country significantly increased its share of the world market in his for products and even managed to launch 19 new products in that period that increase the take on per capita and the amount of one hundred and eighty per capita and the end. In the meantime, and also since independence, but faster given the growth from 2000 onwards, social indicators like infant mortality decreased significantly. Life expectancy increase in parallel to GDP, school enrollment at all levels increased significantly. I mean, in tertiary education, it had jumped by a factor of 10. Since independence and it has great infrastructure, this and we have discovered and over the course of our work that infrastructure, quality of roads and ports are, it’s one of the competitive advantages that Namibia enjoys. The country still has one of the highest income inequality in the world. You can see on the chart on the left, Namibia had a Gini coefficient by 2015, at the peak of the windfall that was among the highest in the world, just trailing South Africa. And it has also one of the lowest participation rates among peers and Hager’s unemployment rate. So this is one of the most significant challenges the country is facing that most of the growth was recorded in industries that are not labor-intensive and therefore jobs didn’t peak didn’t pick up, and the period of growth ended as the super committee cycle ended. So the investment boom in Namibia stopped in 2014. This is not a Namibian phenomenon. Here we can see the countries receiving investments in extractive sectors experienced a significant down downward trend in investment and that meant for Namibia a slowdown in the grades of growth since 2015. And that was when where the country was when COVID 19 hit. Of course, as commodities came down, the country was forced to made a significant fiscal adjustment. So public expenditures came down from 2015 to 2020 by six percentage points of GDP. That’s a massive fiscal adjustment. Primary deficits came very close to zero. The difference being that the increase in interest payments but COVID 19 forced the country to implement an aggressive response to fight that face the shock that brought the deficit back almost to the level where it was before the fiscal adjustment. So now Namibia is slowly starting to consolidate its fiscal accounts again. The country has a lot of credibility on the international community and entered on the RFI program with the IMF and IMF authorities, and it’s a perception of many in the development world that it’s in track in spite of their persistent fiscal deficits that are the aftermath of the COVID shock. The country has a plan to bring fiscal sustainability back, so those are the three challenges that Namibia is facing. It’s facing a growth challenge because growth slowed down in 2015 and took a deep dove on COVID and the COVID crisis and inclusion challenge. Because even at the peak of the windfall, the country still had the second-largest inequality rate in the world. Very low labor market participation and the country has a fiscal challenge because, yeah, the COVID 19 response brought the level of fiscal deficit back to where it was before the adjustment. So the challenge for Namibia, and that’s what we’re going to talk about with the minister today is how do you improve along one or two of these dimensions without deteriorating the others at the same time? Or if you one, are there any measures and policies that can hit these three dimensions at the time? So that’s a that’s a setting. Minister, we’re very happy to have you. I know you are charging people that call your minister a rate of one U.S. dollar for every time. But for the purpose of these talks, I’m going to call you minister throughout, and that’s how we get started. So we wanted to hear about your experience. Is Namibia now. How are you feeling what has been really hard of going through this crisis? And I had a question as well. Is there anything that has been a positive surprise? Is there any factor that reacted in a more positive way than you expected, any help you got from the international community? Is there any surprising plus or were these like myriad of negative news the country and Namibia is getting since the outbreak of COVID 19?

Min. Shiimi Thank you. Allow me to go, I. I hope you can all hear me. And let me thank Harvard for inviting me, I really feel honored to be part of this conversation. We gave you, you still have to be you cannot escape the fee that you think you have to pay for putting the minister, but you can only talk about when I went to Poland. So maybe, maybe I can connect with that with at LEG so I can give you some time to get the money, but then you have to pay. Well, you have more escalate the situation in Libya, the economic situation, as you have said, it’s it has been a challenging situation, especially since the pandemic started. The pandemic already found us in a very difficult position given the fact that the commodity supercycle came to an end and of course, government was also consolidating at the same time. So we were faced with two evil, so-to-speak. One, your revenue has has has come down and is coming down because really part of the strategy of fighting the pandemic was to try and restrain economic activities. You restrain mobility, you, you lock up the country. No people from outside are allowed to come in. People from inside. You cannot move around and therefore economic activities are constrained without constraint. Economic activity The Ministry of Revenue is also going down quite significantly, and that’s one thing we have seen. The second even is that while your revenue is going down, your expenditure will have to go up because now you have to spend more money on health. You have to spend money on social grants. For instance, when we started combating the pandemic at the very beginning, and unfortunately, there was no playbook at that time. So we didn’t we didn’t really have a playbook to look at and see how we responded to this to this pandemic. Should we lock up the economy, should we keep it open? And there was a lot of debates between and of course, our colleagues from the health sector and us from the economic side to try and see whether we can find, you know, a suitable balance or an appropriate balance as to how you can, how you can keep economic activity still going or still being active or the economy. You know, we allow people to be active while the same time introducing measures that are going to contain the pandemic. So this debate where you are in a crisis and in the pandemic, you tend to listen more to the doctors than to listen to the economist. At the beginning, we were leaning more towards listening to the doctors and then listening today to the economist. So as a result, you know, we are locked up the country. But as I say, as I said, apart from now, you know, giving grants. You also had to spend money on the house, on the house health measures to contain the pandemic on the grounds. We had to introduce because basically many people who were deriving their livelihoods on the informal economy, that’s quite a significant number in Namibia. Because of the measures that the government has taken, these people could no longer function. They could no longer derive any livelihood. So we send them home now during that time. So they were facing two choices either they starve to death because they are not getting any income at all, and therefore they cannot buy food or will have to help them. So we introduce any major income grant. And the question was how do we deliver aid in the space of a weeks? What sort of infrastructure do we have to deliver these social grants in three weeks to those that have lost their livelihood? And I believe we came up with a very innovative idea of, you know, using the banking system through electronic money. We could deliver the electronic wallets to the qualifying people and money go to the hands off into the hands of the deserving Namibians within a period of a week and a half or something. Which would, you know, it is not something that we have done before in that event. And I believe it’s something that we’re going to see replicated if we chafe, if we have to, to distribute the grant in a more efficient way. Of course, it was quite cost-effective. We have not really spend money on that on the distribution of these grants. So those like those were the two evils that were that we were facing. Now, when we have asked the question of is there any silver lining in this? I’m not sure whether the way they see any silver lining in the pandemic, but what I have, what I haven’t seen is when you are facing difficult economic situation. Generally, people are people also have. A better. Understanding about the reforms that have to be undertaken. So if there’s any silver lining in this is that people who are willing to listen when you say we are facing a very difficult situation, we have to reform. People say we’re listening better than before. So that’s probably the silver lining when we started with the pandemic, one of the of the big-ticket items in terms of our expenditure was the money that we’re spending on our national airline, which was making losses year in, year out. The conversation was then is this sustainable? Can we maintain it? We know, you know, going forward or should we basically cut our losses and close close the airline? Then then the national debate started, and then ultimately, to cut the long story short, we agreed to liquidate the airline before the pandemic. I believe that was going to be extremely difficult because there is a lot of sentimental value that is attached to the airline. People still talk about their flags they see on their planes and things like that. So this is probably one of the silver linings that I see in the pandemic that, you know, the propensity to reform is higher than during normal times, and that’s probably the silver lining of it. You have asked the question about, you know, support of multiple multilateral institutions. I believe that the fact that this was a global pandemic. The response was also global. So in terms of countries working together to contain the pandemic, in terms of multilateral financial institutions such as the IMF and the World Bank availing facilities, and also, of course, also the African Development Bank availing facility to help countries to contain the crisis and of course, making financial resources available for for the four countries to they know to to be able to absorb these significant losses. In Zimbabwe, for instance, the IMF introduced a rapid facility rapid financing facility that may not many developing countries would exit access in Namibia was one of those that could access that that facility to be able to, you know, to to be able to finance this new venture during these difficult times when that when revenue has collapsed. The African Development Bank also launched a similar facility and the World Bank, so I think it was a lot of support from different angles, from multilateral institutions to help countries that just need to do to come to contain the pandemic and of course, to help with to manage the financial losses that are caused by the pandemic. So a loan is the way you may question.

Miguel Santos: I want to encourage people to ask their questions. The minister has asked me that we move fast to Q&A. He’s very direct. He would like to hear from people, direct questions so more, and ask one or two more questions. And then we’re going to turn to people. But one thing I wanted to ask you is the first time I went to Namibia and we were summoned in that meeting and that outdoors at mid-card. I’ve been in these meetings in many parts of the world, but the first thing we did is you stand up and sing the national anthem, and I don’t think I’ll ever forget that moment. I learned that the Namibians are very nationalistic in the good sense of the word. They love their country, they’re willing to work hard, and they’re very proud people and linked to the pride on the nation. I wanted to ask you a question of something that I’ve been curious about, which is I’ve heard you say in many places like that, Namibia ask for a rapid financing instrument of the IMF, but we have never been to the IMF before. We have never need to go to the IMF before. And there’s an element of pride there that I wanted to ask you about. Is this is this more as just a signal of capacity to stand for yourself? Is this a signal over a rendition of ideology? What is this about?

Min. Shiimi: Well, that’s an interesting question to get. I I believe it’s it’s both of that. The understanding here in the media is that, you know, countries run to the IMF as the last resort where they can no longer, you know, finance their, you know, their budgets within the domestic resources that are available to them taxes. And of course, the domestic financial markets and also the commercial capital markets. So you run to the IMF where you are in a crisis, when are you going to see us because you don’t have any other choice? So the mantra has been, let’s manage the financial resources of government in such a way that we’re never run to the IMF because that would be a sign of failure. So it’s seen as a sign of failure on the part of those that are managing the country so that’s has been the hesitancy. The other reason is that I think we are somehow fortunate compared to other developing countries, especially on the continent, that we have a functioning financial markets. We are able to raise 80 percent of our funding needs. Government funding needs from the domestic market because we have quite significant savings relative to our GDP. And although savings can be accessed by government as well, if you if I can just give you a figure of institutional saving, it’s more than one percent of GDP. So not too many countries are in that position and therefore they can. They do not really have. And IMF may not be the lender of last resort in their cases. It could be the lender of maybe second resort or even first resort in some instances. So I think that’s that probably explains why, you know, our reluctance to go to the IMF. But the IMF is an institution that we own. We are members of the IMF and it is an institution that was established to help countries to manage crises and the pandemic is one of those crises, and therefore we will not always shy away from going to the IMF. If there are good reasons to do that, but we wouldn’t want to run to the IMF because we were unable to manage our office internally. I hope I answered your question.

Miguel Santos: You have. You have. Before we move on to the foreign minister, I wanted to launch upon your personal story because I mean, your story is kind of the story of many Namibians that are coming from the north to the capital to try to make a living and improve and improve its standards of living. And you are a success story. And I guess that’s why we are all working to give every Namibian the possibility of have a story like the one you have had a success story that they can tell their children and be proud of. And because they got opportunities. So coming from the north to the capital, the north of Namibia, for people not familiar with these is it’s mostly rural. Communal land predominates and it’s a very fertile line. So it holds a significant majority, not a majority, but a fairly large number of Namibians are located there. And you came to win at some point. What was difficult? What did you miss when you arrived and what was the toughest part of coming to town and then when you flew to study abroad?

Min. Shiimi: Well, we got. I don’t know where that whether it’s really a success story or whether maybe, you know, we I happened to be our of luck, but I think one thing I should, I should mention is that yes, indeed I grew up in the area looking after cattle and goats. So that was my main activity. Apart from going to school, I was fortunate to go to school, but probably the main reason why, probably were where I am today is because I benefited from relatively good education. Compared to others that were in the same position. In my secondary school, I happen to go to I have I came to Capitol, to the Capitol during that time when I started secondary school and I went to a Catholic school and that was more or less of an elite school, that time for black people. Of course, they way either good schools, but you know, that time before independence, it was only for, you know, for certain sectors of the population, which was basically the white population. So the school where I went, it’s it was considered to be a very, very good school. So I almost grabbed any, you know, any success that I have achieved. Anything else that I’m an extraordinary person. I would just as a normal, normal child, normal students like any of us. But probably the fact that I have, you know, I have benefited from a relatively good education helped me to to to to bring me to where I am today. That’s why the second thing that I started waiting also for a relatively good institution, you mentioned earlier that I used to be at a central bank. I have been in that institution for twenty-five years and I think it’s is probably one of the success stories of my day in terms of our institutional development. Before independence, we didn’t have any central bank. We had to establish one from scratch. But it’s an institution that has a in terms of creating, you know, stability and delivering on its mandate, but also developing people. And Apple have benefited from You know exposure, meeting people like me and smart people like Miguel and others. And you know, that’s a privilege that not not many not even settle. So again, nothing extraordinary is education and exposure. I just happen to be fortunate

Miguel Santos: Many people that came to the capital. I was impressed that if they had children, they left them back in the north with their grandparents. And I mean, when I ask if that was economic reasons, people said yes, of course, but it’s not economic. So what are they going to learn our culture if we bring them here? So that also seems to be an important component that people in the North it’s proud of their culture, and they feel if we migrate the whole family, then who is going to teach the kids the culture?

Min. Shiimi Yeah, yeah, yeah, it is, it’s partly also historical, because people who came to the capital and you asked me if I have an answer to your question on what was the most difficult part when I came to the capital, the first thing was language. I could hardly speak English and I could speak. I could hardly speak Afrikaans, which was the lingua franca of most parts of Namibia. So it was difficult to communicate. But fortunately, I was a bit young so I could still pick up English and I could still pick up of the country. So if you ask me to learn a language now, I think it’s going to be extremely difficult. Now, I was saying it’s partly it’s partly also for historical reasons before because we had we had a system where you could you could only be in certain parts of Canada if you have a permit to be to be in in in these parts of Canada. So you would not be you are not allowed to stay in the capital, for instance, if you had finished so you were on a contract system. So you come to wake up, your contract expires, you go back. So people still consider where they came from as their home because they were, they were basically a temporary. Now that I think has passed on from generation to generation. So now we don’t have that system anymore. But still people still think that’s home where they are in the capital. That’s no fun for them. So they I just see to work. And then when they retire, they will go back home. And of course, they are. Their parents and grandparents are there that they will leave their children there with a difference. But I think that’s changing, though. I don’t think that’s something that is going to continue for a long time with the rate at which embolization is happening in Libya. I think the future generation will not consider where their parents came from his home. I think they are home anyway. So maybe if you come back to me after 10 years, you will probably find it less and less people who will tell you that, you know, we left our children there because that’s where the majority will probably have their children around here. I hope to answer your question.

Miguel Santos: No, absolutely. Absolutely. I’m going to turn to some of the questions that people is asking. A few of them are going to put you in trouble with the central bank where you previously worked because it’s a classic tension in crisis and it has been at the forefront of in the US over the previous presidency. They need to have quantitative easing or a lax monetary policy so the economy can recover versus the central bank bottle. Potential concerns with inflation and in the case of Namibia, with the peg of the of the Namibian dollar to the South African rand. So two of the questions that I’m having are related to do you think the central bank is doing enough? I’m not going to put you into that sort of trouble, but I want to ask how has being the coordination? I think you are in a unique position because you were before the central bank and now the Minister of Finance. Do you feel that you change hearts or this is pretty much people. It’s on the same boat and there has been agreements and there’s a very good question from somewhat are the guys call on the subsidies that you granted business over the pandemic to allow them to survive? How do you roll them back and when and how has that process been still questions?

Min. Shiimi: Absolutely, absolutely. Well, and the first one is a very difficult question, so I’m not sure whether I will be able to answer it satisfactorily. But maybe the fortunate thing is that when the pandemic started, I was at the central bank and and and and that time already some troubling decided to relook at this monetary policy. And it was actually my last meeting at the central bank, the Monetary Policy Committee. But that was a meeting where interest rate we reduce aggressively. That’s the one. We then also started looking at the provisioning or the central bank’s provisioning rules of commercial banks. So that commission bank can be a bit more lenient because the business sector is going to struggle. And then therefore, if you keep the provisioning rules the same way, just killing an entity that is already struggling. So the central bank has already I mean, right from the beginning, the central bank has it has introduced by and eased, you know, the situation before for businesses because you don’t want to kill businesses because it’s difficult to establish a new business, then maintaining a new one, I mean, maintaining an existing one. So that’s one. I think even then, when I left, I came to the Minister of Finance. So again, during the pandemic and anytime so they concentrate, they continue to do the same, you know, reducing interest rates, I think over the currency of the pandemic, the central bank has probably reduced interest rate by, if I’m not mistaken, probably 300 basis points. So and of course, you have you have asked about coordination still, you know, the minister of finance or government is, you know, is introduced was introducing measures to support business as you have talked about it providing emergency grants so that it was done in unison with the central bank. There has been a lot of discussions. We even introduce actually a scheme that was going to help, especially the small businesses. And that scheme was funded by the central bank. But the losses we’re guaranteed by by by the central government. So there has been a lot of coordination, and I think that’s coordination between central banks and the Minister of Finance is very critical to the well-being of the economy. Whether you’re in a crisis mode or whether you are in peace in normal times, so that that is always critical. Of course, there are inherent conflicts. You know, sometimes we wonder what interest we discussed this government because, you know, we want to reduce our cost of funding. But the central banks also have their own mandate to ensure that they they they they keep the value of the currency. They keep inflation low. So I hope I answer your question then. Let me now move on to the other question of some of the subsidies that we have provided. The fortunate thing is that all these subsidies were temporary. The, you know, they had a definite expiry date. For instance, one of the subsidies, as we have introduced, was a subsidy for those that lost employment. So that was a subsidy for about three months or so. Yeah. So they could claim from, you know, the Social Security benefits, but the central government also, then we also introduce a subsidy to businesses that also lost their livelihoods, you know, to help them be to pay wages and salaries. And again, that was for a period of six months, and all those subsidies have expired. So it’s not. It’s not only a question of rolling back because they are no longer in existence. So I hope I have an answer to your question.

Miguel Santos: Yeah, yeah, you have to the extent that you can respond to a question on the central bank, which is putting you in an uncomfortable position. So all countries are we having some fellows at the Lab come in to ask questions directly of the ones that we have in line?

Patricio Goldstein Yes, I think we can invite Tim McNaught to ask the question, make Tim a panelist.

Miguel Santos Tim, so if you are free to ask your question directly to the minister now. OK. Thank you,

Tim McNaught Minister. I had the question written down, but I can’t see it anymore. But anyways, I was really fascinated by the mobile payments, the social grant program that you did, and I found it really fascinating in a new way, the government use technology and really an effective way. And I was wondering if there were other examples of digitization of government that throughout the pandemic, where you feel like there’s been improved processes or there’s have been other successes related to digitization of government. So thank you very much.

Min. Shiimi Thank you, thank you very much, and. Yes, I think that’s that’s where we need to go. You know, digital transformation, that’s where we need to go because I think technology is improving and technology is going to help us to streamline our processes and actually become more efficient as to during the crisis, whether we made progress in terms of digital transformation. We have not really done much during that time. I think early on we introduced, you know, services that we went online, for instance, company registration, always online. But that has never happened before, before the pandemic, before the crisis. So in a number of services, we were online. For instance, when you know, banks vary their, you know, when they want to confirm an identity, operate off of somebody that that is also a digitalized. So a number of it. But during the crisis, unfortunately, I think we lost a bit of momentum. So we focused more of our energy on, fighting the crisis and instead of continuing with that digital transformation agenda. But the agreement is that that’s really the way to go for Namibia. Namibia is, as we have seen from the gallery, you showed a picture, you know, maybe from the map, you’re not able to get your understanding of how big this country is quite a sizable country with lower density. So you’ll find people that are, you know, 1000 away from the capital, but there are not many, but you still have to provide them with basic social services. They need health services, they need, you know, water and electricity and things like that. But because of lower density, the cost of providing those services is very, very high. So the future is really to look at it, how to use technology to still deliver these services in a cost-effective manner. So we have made some progress, but I think there’s more work to be done in that area.

Miguel Santos Great, minister. Well, will we promote the next speaker to the platform, we have a question from Paul H. that I think it’s worth addressing. How much do you see inequality being constrained to long-term growth to the long-term growth where we’re going?  And the question is just like how much some inclusive growth can affect or promote long-term long, long term growth? And how do you see inequality playing as a constraint to that?

Min. Shiimi Absolutely. I think inequality is a big challenge in two ways, in my view. First of all, it’s important to have some social stability. Now when you have a society. Which is highly unequal, you have thoughts that are few that are commanding all the resources, and I’m good in that in that. And you have the majority. With you struggling to make a living, you have a social problem. Because soon the majority will start to demand things, but you can probably provide. So it’s not at least not fair. The wealth of the country is not equally distributed. And that could lead to social unrest. You don’t want a situation like that. So in any society that has to be some fair balance in terms of the distribution of resources, you probably haven’t seen a society where the equal distribution of wealth of resources, but you know, a lower Gini coefficient of maybe 0.3 0.4 like you still live in countries, although inequality is increasing there. So that’s already a constraint on the on, on on on that level. But also. In terms of purchasing power, I think it’s also a constraint. If you have if you put all the resources in me. I can only buy one a week. So you are you also concerned about constraining purchasing power because I would probably save all that money, not spend, not spend it in Namibia. I will. I will go and visit them again in London and spend the money there. So it doesn’t really help the economy. So it constrains economic growth because it also constrains purchasing power. Mm-Hmm. So from those two perspectives, you actually want to reduce inequality because it’s not a good evil to live with. So that’s how I see. So it’s definitely something is a priority for Namibia is something that we need to create growth that is inclusive, that is creating jobs, especially for the majority of those that are looking for jobs. I think that way we can we can really have to think to reduce inequality. Although, as I say, this is a worldwide problem in Namibia, we can probably still reduce it further before we start the rest of the world to see how would we be. How would you keep it low? Because I think that’s a challenge. I mean, you want.

Miguel Santos Absolutely, you’re going to get a question now from someone you know, Nikita Taniparti. 

Nikita Taniparti Thank you, Miguel, and thank you, Minister. I think we’ve had the honor of knowing and learning much about Namibia recently. But for someone totally unfamiliar with the current context of Namibia, having listened to what Miguel presented and some of the responses you’ve given, what should they know about the broad opportunities for economic development in Namibia? What’s something that you think is not as known to the rest of the world? And where do you see the challenges to overcoming? Where do you see the challenges that need to be overcome to see these come to life?

Min. Shiimi Well, that’s a that’s a difficult question. We believe as a country, there are economic opportunities. I mean, you get our heads showed you what has happened in the past that the country was growing and plus growing relatively fast for, you know, almost a decade ago has showed showed you that the country know, move into new industries, gain more market share. So I think what is left now is for us to become a bit more innovative and start to figure out what else can be done, what can we do, which are the new areas of growth? One, for instance, which which which are. We are aggressively pursuing one strategy that you make. If you wonder what exactly is that the country is has got access to renewable energy in terms of wind and solar. We are one of the best in the world comparable to countries like Chile and and Saudi Arabia. So the question that we’re asking is, how do we make use of this renewable resource that we have? Of course, we need energy, we import some of our energy from our neighbors, but also how can we use make use of this energy, for instance, to move into new areas, for instance, the green hydrogen? So that’s something that we have, that we have to be very, very optimistic at COP26 in November, maybe votes in November in Glasgow. We we just announced because we went through a request for proposal process where we invited bids to, you know, to bid to come in and actually do payloads and experiments in Namibia. So we give them a piece of land and access to a two to our time to come and test whether, you know, the potential of a green hydrogen and that was awarded or that it was an award was announced at COP26. So we are now in the process of finalizing this with it with a bit that we did with Texas would be done. Who is going to deploy his own capital over the next 18 months or so to really demonstrate the potential of the green hydrogen sector in Namibia? So that’s one area. The other areas, of course, we believe that, you know, as a country, we have now look together with our step. I looked at, you know, which areas where can we diversify into potential already existing industry? The value in existence may be small. How do we scale them up? And also in terms of new industries, what are the comparative advantage we have? So we have now come up with a list of products 75, which we have split into into phrases like this will be the priorities for the next five years or so, the next phase and then that phase. So while this request is a close collaboration between private sector and public sector, because public sector will have to provide them using public goods, you know, infrastructure, energy, telecommunications services where private sector cannot, you know, make a significant contribution is public. We have to be provided by government and also to coordinate the different entities. So we we believe if we improve our coordination, if we improve our dialog with it, with a specific public or private sector that can exploit these opportunities. Let me be as obvious growth trajectory to change, and you can start to grow again in an inclusive manner that is going to create jobs and in a manner that will hopefully help us to reduce inequality. That’s more or less what I would say, but if you want me to add more, you can. You can come back.

Miguel Santos We’re going to have another of our project fellows, Alexia Lochmann, coming up to ask a question. I have a few questions Minister, in the chat while Alexia up, on the African Continental Free Trade Area. How do you think that can help economic growth prospects post-pandemic? If you think it’s going to slow, is it going to result in intra-African trade within southern Africa or a trade creation versus diversion? What are your thoughts?

Min. Shiimi So you are going to talk about that question now or do you want to help us do our bit for Alexia? OK, very good. I think that’s that’s an opportunity that is that is really opening up for the continent. The fact that, you know, the continent is dropping the tariff barriers is dropping all the other in all the other various trade. I think this is an opportunity that Namibia want to exploit. So our message to to the investors is that we want to work with them to come and sit up here, you know, produce goods for for the continent because it is a continent of more than one billion people. And unfortunately, this population is still growing. And I think last time I checked is probably still the continent that is going to have, you know, positive growth in terms of population until until 26 years old. So it’s still a population that’s going to create young people and probably the migrants, but it’s going to change and hopefully the process is going to change. So I believe there are enormous opportunities. And therefore, as a country, we I think positioning ourselves. That’s why we are looking at the comparative advantage that we have so that when we are talking to investors and we want to target those specific ones that can actually, you know, that have an interest in that have already produced the kind of of of of products and services that that that that that we we are seeing as an opportunity to produce it that may be able to deliver in the media to come and sit up here and serve as a continent. So that’s definitely an enormous opportunity. Where are we now? The trade free trade area has been launched in January 2021, if I’m not mistaken. And now we are basically just, you know, doing the final rounds of making sure that we’re comparing our tariff tariff schedules. So we know that everybody, we make sure that everybody needs that exchange and also making sure that the rules of origin, you know, equitable and are implemented according to agreement, because that that can be a source of a lot of these agreements. If you don’t agree on on on rules, on the rules of origin, because I can import things from from the US or from China and from India and and export that to the rest of the continent. But those are things that are produced on the continent. So I will be. So we will have to make sure that the rules of origin agreed upon and everybody complies with that. If that was the point. So that’s where we are. But this is an enormous opportunity.

Miguel Santos Alexia, go ahead.

Alexia Lochmann Hello, Minister, thank you so much again for forgiving minister it. It’s good to speak with you again and to hear your voice to see you. We have had the great pleasure to meet and I really hope I can. I can visit them again soon. I feel absolutely in love with the country and the people. And so, so yeah, I think my question rotates back a little bit to something we have touched upon earlier, which is kind of the digital economy. And I wonder, do you see some potential for especially younger people, let’s say, for example, in in the northern areas, for example, to learn skeeters digital skills that then they can work within accordance with international community. So, for example, people don’t necessarily have to emigrate to the cities to work, but maybe if they’re connected to a digital framework and if they have some skills, they can actually work from what nowadays still consider home and sort of build an economy around that. Yeah, I was just wondering about your thoughts with this regard.

Min. Shiimi Thank you, Alexia, and I hope you come back soon and I know this to you. You know you’re here. But unfortunately, we didn’t have you not able to visit the whole of Namibia, and you would no longer do what you’re supposed to be doing because of the pandemic. But hopefully things are going to change. So when you come back again. Now you mentioned, you have mentioned very, very important things the digital economy, you know, the use of technology. I believe that’s the future, the future is really in digital transformation. And I think from a government perspective, the government has to intervene in different ways once you know, to expose children laziness at the young age. So we must make sure that children at school or already exposed to technology so that when they when they start to use technology, they already use technologies that way. I believe you open up those opportunities that they’re thinking about. So that’s one. The other one is, is this providing connectivity infrastructure? By and large, this is done by the private sector. But they may steal some level of public goods that have to be provided, as they say, as I mentioned earlier. There are areas. I see no way the densities are very, very low, so it’s difficult for the private sector to go there and provide connectivity infrastructure because it’s simply not profitable. And that’s probably where the government has to come in and help to provide those connectivity infrastructure. So the question is, how do we find it? So that’s now the question we are trying to wrap our arms around. It’s a question of having different ideas, you know, for it is one that universal access funding can. We can we consider establishing something like this the way we can collect some levies from, you know, the users of telecommunication services and maybe part of that money can they can be redeployed in in areas where it’s not profitable for the private sector with it. So that way you unlock that demand and that way you expose people in that area to the technology early enough so that they can actually make start making use of technology. And they don’t have to come to town, as you say, but they can because you provide a service. So I think there are different areas where the government will have to intervene. This is a very, very critical area. So it’s in fact an area that is enjoying the focus of government. If you look at our plan, which is we use for the next five years, we use called the Harambee Prosperity Plan, which is basically the active government development of development plan for now. It’s a pillar all connectivity infrastructure because this is a key to unlock some of these opportunities in the outlying areas where people are still migrating to town. But of course, the rate of migration is not something that you can. You’re going to stop. I think that that is the nature of these. But do you still want people who are going to remain to have access to these services? And maybe they can. They can still be alive while they are still there, but you know, through, you know, technological platforms. Let me leave it there, Alexia, but to come back tonight, maybe we can have more of this discussion.

Alexia Lochmann Thank you so much, Minister. Yes, I. We are planning on hopefully coming back very soon. Thank you again.

Miguel Santos Minister, thank you very much. We want to be, I mean, respectful with your time because, you know, people don’t know, but we know that today you’re coming from a long session in Parliament to pick up this chat after a long day. We really appreciate having the opportunity to exchange ideas with you. This is had been I can tell you, this has been one of the most populated talks that we have had and the girl development talks, and I wanted to thank you for the opportunity. I look forward to continue working together. I hope you have enjoyed the talk and as I told you, once we are, we’re very excited to working in Namibia and we want to. We want to make a difference there to help you achieve all the goals that you have been pursuing because it’s a great success story and it can be a great success story. And as I said, we wanted that all children, you know, when Namibia started, I was there with the minister as you, me and a group of people that was working hard to bring the country together and improve the standards of living. So I appreciate the opportunity and I appreciate having you today on our talk.

Min. Shiimi Thank you, me, Miguel, and let me thank you and your colleagues at the Growth Lab for inviting me to participate in this conversation. It has been an absolute pleasure to have, you know, to engage all those that are on this platform, but it has also been an absolute, absolute pleasure to work with. You know, this is the professional team. It’s a team that is willing to make a difference, and therefore I continue to look forward to continue to work with it, with the team and the rest of the community. Thanks once again for inviting me to be part of the conversation and thank you for the conversation. Thank you very much.

Miguel Santos Thank you. Have a nice evening in Windhoek. Minister and thanks everybody for your interest.

Min. Shiimi Thank you. Thank you.

DISCLAIMER: This webinar transcript was loosely edited and there may be inaccuracies. 

Ricardo Hausmann Thank you, Eric, for doing this. Yeah, I’m very excited by this occasion where we are going to be able to discuss your new book and Eric came to us. I met him when he was doing his master’s degree in technology policy at MIT, where he was concentrating on if you want to call it economic data science. He took my advanced course at the Kennedy School, did spectacularly well, innovated in a bunch of things, did things that other people couldn’t do. So we hired him and we put him in a dual function, both working with the academic team in in trying to push the boundaries of knowledge and the applied team trying to work on specific countries. He did a remarkable job working on the projects in Western Australia and Jordan and Colombia and in and that’s what I asked him to do. But in his spare time, he wrote a book and in the and it’s quite an impressive piece of work in a so a without any further ado. I mean, the issue of populism and the causes of populism and what to do if we wanted to prevent populism and preserve democracy is, you know, a top issue in many, many countries, including the US, a less so in his native Canada. And I think the contrast between the two countries is it’s constantly in his mind and informs a lot of what the book ended up finding in an exercise with a lot of data, a lot of data science and trying to make the data confess. So without further ado, let me let Eric tell his spiel.

Eric Protzer Well, thank you both to Ricardo and to Chuck for those very kind introductions. I’ve got a presentation here that I am going to share. There we go, got the spy there, so as was mentioned, the title of the book is Reclaiming Populism: How Economic Fairness Can Win Back Disenchanted Voters. This is a project that my co-author, who is Paul Somerville, an adjunct professor at the University of Victoria, who stops in the School of Business. He and I started work on this about three years ago when we sort of observed a lot of the political reactions to populism in the US and the UK and compared it to our native country of Canada. And we sort of felt that there were reasons that these sorts of things were not transpiring in places like Canada and other countries as well. You can think Australia, arguably Japan, the Scandinavian countries. And so we set out to write a book to try and differentiate why we think that is precisely. So I’d like to begin by giving an overview of the book and what differentiates it from a lot of the other discourse on populism. And then we’re going to give sort of three main body arguments of the book. First, how economic unfairness leads to populism. Second, the policy inputs to a fair economy. And third, how to diagnose constraints to social mobility. And then we’ll follow up with a conclusion with some high-level takeaways about the book’s message and how it can be relevant for anybody who is concerned about pockets movements around the globe. Let’s begin with an overview of the book. Now, the typical book on populism cites how worrisome its leaders are, such as some of these gentlemen on the right here, and it tends to offer typically some sort of long-standing political concern as an explanation for voters motives, things like there being too many poisonous ideas in society or too many foreigners or too much income and wealth inequality. And what I really want to emphasize is that the book Reclaiming Populism sharply diverges from that existing conversation. We instead argue that the extant debate really fails to capture the legitimate economic unfairness that citizens are really angry at, and importantly, that that unfairness is not the same thing as simple income and wealth inequality. It also stands out because it offers detailed and actionable policy advice on how to fix the root issues of economic unfairness that substantiate populism around the world. So all being told, reclaiming populism argues that populism strikes hardest when the economy is unfair. It contends that a fair and socially mobile economy is possible through equal opportunity and fair on equal outcomes. And it shows how to diagnose which missing policy inputs most constrain social mobility in a given country.

Let’s delve right into that content with the first element of the argument. How economic unfairness leads to populism. So this year is a diagram essentially of the argument for the causal model that we have in mind where the beginning of it is a pool of policy failures and those, in turn, lead to two problems that really are the core of what we’re talking about when we talk about economic unfairness. And that’s opportunity being less equal and reward being less according to contribution. It’s notable, importantly, that these things are not the same as weather outcomes. Economic outcomes are simply equal or unequal. Those problems, in turn, create to really concrete consequences, persistently low social mobility, and also high vulnerability to economic shocks. So you can imagine that whether you have an unlucky start in life or if you’ve been knocked down by an economic shock, these kinds of problems of economic unfairness make it very hard for citizens in precarious economic positions to get ahead on their own merits, on their own talents and effort. That, in turn, leads to the perception of an unfair system in need of perhaps forceful correction and in turn, the impetus for populism and populist solutions, quote-unquote, that offer stark alternatives to the status quo. In order to take this kind of model seriously or this argument seriously, I’m going to break it down piece by piece and substantiate all the different parts of it. First, for the start, I’m going to skip over policy failures for now, and we’ll return to that later. But I really want to first address this. These two issues here of economic unfairness. Why should we think that citizens are especially sensitive to economic unfairness in particular? And in fact, there is strong evidence in behavioral science literature that people care quite a bit about fair economic outcomes in particular. And vitally, these kinds of fair economic outcomes are very different from whether outcomes are simply equal or unequal. Now, that may seem like a confusing or a two statement, because so much of the popular discourse around economic justice assumes that all kinds of inequalities are bad, and it tends to talk about fairness and inequality somewhat interchangeably. So to give you a reason to take that idea seriously, at least from the start, here is a quote from Angus Deaton, who is a Nobel laureate in economics, wrote in an opinion piece a few years ago that inequality is not the same thing as unfairness. And to my mind, it is the latter that has incited so much political turmoil in the rich world today. Some of the processes that generate inequality are widely seen as fair. But others are deeply and obviously unfair. I have become a legitimate source of anger and disaffection. And in fact, once you separate out those two ideas of equality and fairness, there is good evidence, as I said that people are really sensitive to fairness in particular. And this paper by the Yale psychologists Starman, Jessica and Bloom, they write that there is no evidence that people are bothered by economic inequality itself. Rather, they are bothered by something that is often confounded or confused with inequality, economic unfairness and having separated out those two ideas, they argue and know, for example, that one to two-year-old babies expect more resources to be allocated to those who have done more work that six-year-olds prefer to allocate more resources to someone who has done more work, even if they have the option to allocate rewards equally, and that individuals surveyed across 16 different countries overwhelmingly prefer a decidedly unequal distribution of economic outcomes in society, presumably because they understand that different people deserve different rewards depending on their contribution, and that position is hardly an outlier in the literature. And this PhD thesis from Oxfam the debug on the evolutionary origins of human fairness. He writes that it is well accepted in the behavioral sciences that people prefer income distributions with strong work salary correlations preferred to give more to individuals whose input is more valuable and favor meritocratic distributions as a whole in both micro and macro justice contexts. Now in the book, we spend a whole chapter going through even more evidence for whatever that that shows. This is true and shows why this is. But the point here is that is not to dismiss the importance of inequality outright. It’s simply to point out that people are especially sensitive to economic unfairness and that this is a different concept from simple inequalities of income or wealth.

Now, having demonstrated that point that people really are sensitive to problems of economic unfairness, naturally, the next question in this argument is, OK, well, is there proof any proof that indicates that problems of economic unfairness and their consequences are actually associated with political discontent and populism, which is where this time this part of the diagram starts to play a role? And one angle in which the book addresses that problem is by looking at low social mobility. And when I say low social mobility, I’m specifically referring to a situation where individual economic success in a country or a region strongly depends on family wealth. And in that kind of situation, that’s a pretty clear violation of economic fairness because most people hold, I think that’s your family. Wealth is not innate driver of your productivity. You know, it’s not your parents do not decide your own talent and your own character and your own effort on the whole. And that’s low. Social mobility is a fairly clear violation of economic fairness in particular and reclaiming populism. And the research behind it, which is a Harvard growth lab working paper, demonstrates that low social mobility is in fact a robust statistical predictor of the geography of contemporary rich world populism, both across and also within high income countries. And importantly, alternative factors like income and wealth inequality, immigration and social media are not. They do not have the same systematic, statistically significant correlation in a wide variety of settings. The research behind the book Linking Low Social Mobility to Populism has been cited by the EU, the UN, the IMF, the Inter-American Development Bank. It’s been featured by Brookings Professor Philip McCann, who coined the term geography of discontent, cited this research to write, and I quote that social mobility is the crucial indicator of populist voting. In addition to that angle, you can also look at the consequences of major economic shocks because populist language frequently rages against the perceived unfairness of things like the global financial crisis and globalization, and frames it in terms of a purportedly corrupt elites that have unfairly put their interests ahead of the rest of society. So that you can try to look at whether there are channels there by which those kinds of events and their consequences have specifically led to political strife through the channel of economic unfairness in particular.

We go into a variety of evidence for this in the book, but one compelling argument comes from a paper by focus should direct intervention on the politics of financial crises from 1870 to 2014, where they find that on average, far-right parties increase their vote share by 30 percent after a financial crisis. Importantly, we do not observe similar political dynamics in normal recessions or after severe macroeconomic shocks that are not financial in nature. Now, to anyone coming from an economics background, that ought to be a really interesting finding because you have two kinds of losses that are essentially the same in magnitude. And yet the political consequences of them are very different, depending on the reasons for those shocks and to explain why that is, the authors write. What explains the more severe political fallout after financial crises? One possibility is that non-financial downturns are seen as excusable events triggered by exogenous shocks, while financial crises may for sure may be perceived as endogenous and inexcusable. I might use the term unfair the result of policy failures, moral hazard and favoritism. Again, we go into much more evidence in the book, but this is the kind of thing that would leap where I would lead one to conclude that citizens turn to populism when they are fed up with an unfair economy. They feel the system is rigged and must be forcefully reset, and that other factors like social media and immigration are best understood as amplifiers rather than systematic, cross-cutting causes of high degrees of populism across the globe. To try that, to try and make that phenomenon a little more tangible for you. I have a quote from a swing voter from the US who in 2016 ultimately voted for Donald Trump, and he was quoted in the Boston Globe as writing. I see my tax dollars going to handouts for others who didn’t work as hard as I did, and I can’t afford my health care. Everyone is being taken care of by me. I feel left out and it makes me feel that I want my country back. This voter is evidently very concerned with the unfair, purportedly unfair relationship between contribution and reward in the United States. And the essential thesis of the book is that he’s not alone.

Now, if you buy that argument and you understand that economic unfairness is a key contributor to populism around the globe today, the next natural question is OK, well, what can we do about it? What are the policy inputs that substantiate a fairer and more socially mobile economy? And that addresses, if you recall this diagram, the first element pertaining to the policy failures that lead to economic unfairness and its consequences. Something I want to clarify right from the get-go is that a lot of the political discourse around the policy inputs to social mobility is not really close to the mark. You can see that this diagram here on the horizontal axis, it has government spending as a share of GDP in 2018 for different countries and then on the vertical axis, it has social mobility where I’ve arranged countries with low social mobility at the top of the graph. In countries with high social mobility at the border. And you can see that the traditional prescriptions of we just start to have small government get government out of the way so people can get on or big government have lots of intervention to fix all the problems that are there. Neither of those are really silver bullets. You can see that countries like Switzerland, the US, arguably even the UK, are representative of places with relatively small government and nevertheless suffer from low social mobility. And by the same token, you have places like Italy and especially France that, on the flipside, have large governments and also suffer from low social mobility. So if the solution isn’t quite as simple as many politicians might tell you, naturally, that might be one to ask what actually are the policy inputs that really support social mobility? And we argue in reclaiming populism that the most socially mobile countries today use policies that specifically enable equal opportunity and fair on equal outcomes. You can think of countries like Australia, Canada and the Nordics, the Scandinavian countries that terror state-sponsored equal opportunity with competitive markets. And as a consequence, they have high social mobility and they tend to be populism resistant as well. It’s not an absolute bulletproof screen, but it’s like a firewall against populism that prevents its worst excesses.

You can imagine how Australia and Canada have not had to deal with anything quite like the Trump phenomenon. The Nordic countries have not had to deal with anything quite like Brexit. And in spite of the immense shock of the 2015 European migrant crisis. In fact, in the 2019 European Parliament election, Denmark and Sweden voted for populists at ad rates, respectively of around 10 and 13 percent, whereas the range for other countries like the UK, Italy and France was more like 30 to 50 percent. Quite a difference there. Places, in contrast, that fail on either of these categories of policy inputs tend to suffer the consequences. The United States certainly has competitive market outcomes. But on the whole, it does not support equal opportunity because it has threadbare investment in public goods compared to other countries. France, on the other hand, has a world class social safety net. As you can imagine, everything from education to health care transport infrastructure, but arguably also has an overbearing state that regulates and taxes away the fruits of success, which can make it very hard for people who are trying to move their way up the career ladder to actually work their way up and be rewarded according to their contribution as a consequence of these problems, we argue. Both countries fought for from low social mobility and have fierce populist movements. Ensuring the policy inputs to equal opportunity and fair on equal outcomes are themselves quite complex. I got a diagram here, and if you’re familiar with the Growth Lab’s work, you’ll notice that this is somewhat akin to a diagnostic treat. Now there’s a lot going on here, and I promise we’re going to break it down, but I want to just make some initial observations about it for you. You can see that economic fairness is at the top of the chart. You can also think of social mobility being supported there, and that in turn relies on equal opportunity and fair on equal outcomes. Those two elements, in turn, depend on a wide variety of categories of policy inputs that support them. You can see that equal opportunity, for example, depends on formal equal opportunity freedom from discrimination, but also substantive equal opportunity or the ability to use public goods to become productive and access economic limitations. And similarly, protection against unfair events like financial crises or even ill health by a health care. By the same token, it is just as important for countries to embrace fair on equal outcomes, which depend on the ability to reward value creation through an efficient market. That, in turn, depends on all the inputs that are conventionally understood as the things that support economic growth. And additionally, the need to punish cheaters through a justice system and taxation and regulation such that unequal outcomes insofar as they occur actually are fair and that reward is really still according to contribution.

Now, there’s a lot going on there, but it’s easier to comprehend. I argue if you imagine the life trajectory of somebody who personally experiences social mobility, you can think of somebody who is, say, born into a working-classblue-collar family and worked their way up to become a middle-class plumber or accountant. It doesn’t really matter if it’s blue collar or a white collar. But the key thing to ask is what needs to happen along the way and what is the role of the state and a policy at each of those steps? The very first thing that needs to happen is that somebody has to be able to have the opportunity to become productive and there there are commonly discussed inputs that are relevant, such as access to affordable, high-quality education and childhood nutrition. Now, those kinds of inputs often constitute the entire policy debate on social mobility. But we can tell in the book that it really shouldn’t, because that just gets a person to the point where they are productive in theory. And as you’ll see, there are a whole bunch of other steps that then need to happen to actually get them to the final destination of making it, say to the middle class immediately after somebody has got that ability to become productive. They then, for example, have to be able to actually physically access jobs with economic opportunity. You can think of cities or towns or simply whatever geography they need to go, where they can find a job or start a business. And relevant policy inputs there include things like housing and transport infrastructure. You might know that these things have featured quite heavily in the recent leveling up debate in the United Kingdom for good reason.

Once somebody has been able to become productive physically access to location, they need to get to in some way, the economy that’s there has to be able to actually offer ample job and business opportunities. And this is something that is not frequently discussed in the conversation around social mobility. But we argue quite strongly in the book that this is really only possible with a competitive private sector. If you do not have a private sector so that people can find job opportunities and find opportunities to start a business, then that opportunity remains theoretical and it isn’t translated to tangible success. You absolutely need an efficient market and all the inputs that support competition and economic growth to go along with that. When somebody is then competing for those kinds of opportunities, insofar as they exist in society, they must be able to do so in a way that is free from discrimination for one, both in law and in culture. And they also must be able to do so in a way that is free from the influence of economic cheaters who might take away opportunities and unfair ways. You can imagine that it’s no good if you’re going to start a business to set up, shop right next door to a monopolist or somebody who undercut safety standards when you’re really trying to get ahead simply by creating value and getting rewarded for that value creation. The entire wages purge society has a key. Or rather, the state has a key role in minimizing the chance of a society wide, unfair events like financial crises, you can imagine the rule of financial regulation taking a place there and also to insure against unavoidable perennial unfair events, things like PhilHealth or a job loss in a cyclical downturn that can never be totally avoided, but can be mitigate mitigated against through things like health care and unemployment insurance, so that a sudden and anticipated and perhaps unfair shock as unfairly cut someone off from future opportunity by bankrupting them wholly collectively. As such, we argue in the book that there are multitudinous complementary policy inputs to social mobility, and part of the consequence of that is because you have to get so many things right.

In order for social mobility to happen, we argue that’s a reason why very few countries actually are able to do that in practice. There’s really only about half a dozen countries that are in that upper echelon of the highest social mobility in the world, even if fewer than there are developed countries. And here’s that diagram of all the relevant categories of inputs here that we argue for just for consideration once again. Now, having established an RV for all those different inputs that are possibly relevant to social mobility. Next, we want to take things to the lens of a policymaker who is looking to reform social mobility and Peru social mobility in their particular country. And that’s where it becomes very important to diagnose the top constraints to social mobility on a case-by-case basis. Now, vitally, we see these inputs to social mobility as complements and not substitutes. And what that means is that, for example, you cannot fix a terrible education system by investing more in transport infrastructure, and the vice versa is also true. You have to actually fix your failing schools, and you have to actually fix your failing trains. You can’t just swapping out for each other. And the consequence of that is that it is critical for policymakers to diagnose which missing inputs most severely constrain social mobility in a given country. And the reason for that is so that your reform efforts don’t go off in some tangent or some area where you are perhaps already doing relatively well when there’s some other failing area that you’re doing very badly on and is really holding back social mobility on the whole, that makes that story of somebody going from the working class to the middle class impossible in some way. And in order to do that, we take a leaf from the Harvard Growth Labs diagnostic methods, which of course, is hosting this talking and where I work. And there are a variety of detailed steps that are involved in the diagnostic method and some tweets when you need to apply to the question of social mobility, which we go through in detail in the book, unfortunately, is that it is a bit technical, so I can’t cover all of it today. But I want to present sort of the core idea of the diagnostic method, which is to hone in on the most severe or binding constraints to an economic output. And those tend to be both highly desired and also scarce. As a consequence, you can look for signals in the data that something tends to be in low supply and high demand in various ways.

To give one quick example of the kinds of analysis you might look for in the kind of data signals you might look for, we can consider the question very hot topic in the UK today. Does leveling up regional infrastructure actually make a difference? Is this really likely to improve economic opportunity in the regions of Britain apart from London? Now, first, you might turn to the question of supply and try to figure out whether there is a low supply of infrastructure in those regions and a starting point there might be to recognize that the UK has on the whole, arguably undersupplied infrastructure investment across the nation. This is a graph of the average government gross fixed capital investment in G7 countries as a share of GDP from 1995 to 2015, and you can see that the UK is second to last and lags behind a couple of important comparator countries like Canada and the United States on France. Also on the whole, there’s perhaps reason to think that infrastructure is undersupplied in the UK overall, but in addition to that, there’s further evidence that it is especially undersupplied in regions. Coyle and Sensier in a 2019 paper, show that many infrastructure projects that were approved in London had in fact lower cost-benefit ratios and those rejected in regions. And what that means is that that infrastructure investment that is already scarce in the UK as a whole is especially concentrated in London and therefore doubly scarce in regions. So that’s maybe not a complete and thorough analysis of everything you could do to address that question. But that’s the kind of evidence you would look for it to indicate that something like regional infrastructure investment is in both supply. And then you want to turn to the question of demand. Is this also in high demand? Because if it is, then expanding that supply will create large payoffs. In the case of regional infrastructure in the UK, one piece of evidence you might consider is a 20 19 Ernst and young survey of foreign investors where they ask these foreign investors, what’s your top decision factor for investing in UK regions? And the survey showed that transport and technological infrastructure was in fact the top decision factor ahead even of the availability of local skills in the labor force. Now, of course, these investors are the kinds of people that would be bringing in new business, new economic opportunities in the region so that people can work their way up the career ladder and be rewarded according to their contribution. This is a vital indicator to indicate that regional infrastructure in the UK better regional infrastructure in the UK is in fact highly demanded. As a consequence, this is some of the evidence that you might use to conclude that regional infrastructure in the UK is in both low supply and high demand. It’s therefore plausible that it is a binding constraint to social mobility and expanded economic opportunity in the UK.

Now, after identifying that kind of issue as a binding constraint, you might want to ask, Well, that’s kind of a weird situation. Why is it that someone is stuck in low supply and high demand? Because usually that is corrected either by market forces or by people going to the ballot box and essentially getting angry about it? And in turn, you might ask, well, why is there that equilibrium? Is there a political economy syndrome that explains why the regional UK is exhibiting symptoms? In the case of the UK, we make an argument in the book, essentially for fiscal over-centralization, you can see this graph here shows on the horizontal axis, the bog of population and then on the vertical axis it has the share of government investment that’s conducted by central government, essentially the infrastructure spend and other kinds of spending that are conducted by central government versus regional and local governments. And you can see your story. You can see that there is no other large high-income country apart from the UK that spends so much of its investment and the level of central as opposed to regional and local government. The UK is a definite outlier in that regard. And the same pattern shows up. If you look at the taxation side, this graph is similar, but on the vertical axis it shows the share of taxes collected at the level of central government as opposed to regional and local. And once again, the UK is a clear outlier. Both its tax collection and its spending are quite concentrated at the level of central government, which could explain why there is so little infrastructure investment in the regions that so sorely needed. In the book, we consider other issues as well things like the state of health care and education being unaffordable in the US and how that contributes to social mobility are things like the overbearing taxation and regulation regimes and France that arguably prevent people from working their way up the economic ladder and constrained labor markets and tax administration in Italy. And we go into more detail about the UK as well. This is sort of just a taste of what’s possible. So with that in mind, I’d like to conclude the presentation part of this event with a couple of key thoughts that we think are relevant to anyone who is concerned about the state of populism around the globe today. And the first of those is don’t mischaracterize populist voters as uniformly deplorable, stupid and racist. This is too often a perception of those kinds of voters. But in fact, those voters also notoriously complain about a rigged system, and the data indicates that they have a point that economic unfairness, low social mobility and other problems associated with economic unfairness are in fact tightly associated with the incidence of populism, and because populism is grounded in very real entrenched economic unfairness. Importantly, it cannot be simply beaten down and defeated. You can’t just excoriate that segment of the population and hope the problem will go away. It’s systematically entrenched.

The only option is to reclaim the populist vote by substantively rectifying the very real economic unfairness that drives it and turn the way in which to do that is very important. The messaging and policy to win back the populist vote must be precisely targeted at a fairer economy and replace specific binding constraints that underpin and its messaging and policy cannot be confused with conflicting and unfair ideological goals like aggressive redistribution or less. They fear neoliberalism. You can imagine, for example, how in the UK, Jeremy Corbyn’s platform completely imploded when he was offering a hard left alternative to the status quo. And as some journalists have noted it, it’s because these voters really didn’t want equalization. They saw that as unfair and everybody gets the same regardless of their contribution when really most people want the chance to get on. And on the flip side, you can think of issues associated with less fear and neoliberalism where you take the position that the market is always right, even if it’s unfair. For example, you can think of Tony Blair’s famous quote where he said that some people ask whether we ought to stop and debate globalization. We might as well start and debate whether autumn ought to follow summer. Now, however, pie the cold that might have been too many voters that ignored the very real consequences that globalization can have for them if it’s executed under conditions where those disaffected citizens do not have new opportunities to adjust to find new paths to success. I want to thank everybody for listening to the presentation today, reclaiming populism is available on Amazon, on my publisher’s website, Polity Bookstore, and in bookstores everywhere, and I’m looking forward to Q&A both with Ricardo and with the audience. Thank you so much.

Ricardo Hausmann Great. That was quite an impressive synthesis. And you, you must have planned it very well because you were just on time. So thank you. Thank you very much. Before I go to the Q&A, let me ask you a couple of questions. I can imagine a world where social mobility aim can also cause problems. I mean, if you start in a situation where, say, some groups of people say and black people, minorities, women, you start with a lower share of of of the pie and lower wages and so on. And they progress and that the people who used to be higher up in the ranks might get concerned and worried, etc. and that I could interpret that some of the malaise in parts of of the populace vote is, is that, you know, the gap between black and white, between men and women has been narrowing. And especially for people with less than high school education. And would you say that there might be some? Is it all? Is it social mobility always good? Or is social mobility in some sense? It puts people. I mean, for everyone that goes up, somebody comes down in the ranking, right? So what happens to people that come down in the ranking when there’s a lot of social mobility? Is it? Will they develop a discourse to in some sense entrench their previous rank and that they will favor, you know, policies that would prevent them from moving down?

Eric Protzer Certainly so that if people in the audience are looking for an expanded version of that argument, I’d refer them to the book Identity by Francis Fukuyama, which essentially makes that argument that it’s a matter of status threat that’s driving populism around the world. The traditional think like white blue-collar men feel threatened by the rise of these new minorities and these new immigrants that are gaining power. I would say that for. I mean, first of all, the data doesn’t support the idea that low social mobility is negatively. So the data doesn’t support the contention that social mobility is negatively associated with populism. It’s quite clear that worse, social mobility is systematically associated with worse populism, so it doesn’t really play out empirically. But if you want to address the question from a more of a qualitative angle, I would say that it’s important to conceive of this, at least in my view, in the sense that social mobility isn’t a zero-sum game. It’s not like, you know, some people necessarily lose out when other people run. It’s more the way I think of it. More is about a system of complex cooperation where if you have other people who are given the opportunity to be productive, that actually makes you better off. And the way that I see the frustration surrounding populism is not so much that people are worried that there are these other minorities that might surpass them. It’s more akin to that. That quote from the Boston Globe that I shared where, you know, you have people who feel that they have worked really hard, they can’t afford their health care. They feel like they’re being left behind, essentially. So I think that people are perhaps less antagonistic towards the these perceived status threats and then than is frequently claimed, and that it’s more about these individuals feeling that they aren’t being rewarded.

Ricardo Hausmann Interesting, interesting. And also I mean, Canada, Australia are two countries where immigration rates are much higher than, say, in the U.S. or France. Yeah. Why do you think immigration is so much of an issue in the populist discourse and say, the US and the UK? And why? Why does it not take hold in Canada and Australia?

Eric Protzer Yeah, that’s so that’s something we address at length in the book. But the basic argument is that in a situation of economic unfairness, where you have people who are already there who feel like they’re not being rewarded, they’re not getting the opportunities and support that they need to have. Then when you have that immigration coming in or a refugee shock or what have you, it’s easy for that lead to lead to a situation where people perceive those newcomers as getting help when they feel that they’re not getting help. There was a fantastic quote in The Economist a couple of years ago, for example, where they interviewed populist voters in East Germany, and they essentially were interviewing them about this immigration question and the way they synthesized the respondents answer was that they really hated it when people classified them as racist. They really felt that they weren’t racist, and their concern was that they felt like they were being left behind and that newcomers were being helped first. And one of the consequences of that is that you can have these xenophobic spillovers in places that are affected by low social mobility and economic unfairness. And in contrast, you can look at places like the Scandinavian countries where they had a huge migration shock. There was a bit of a populist moment and the vote share in national-level elections even, I think in Sweden went as high as 20 percent for populists. But, you know, there was nothing like Brexit and the easy vote shares in the European Parliament election came down quite a bit. So overall, we see immigration as potentially an amplifier, something that can make the problem of economic fairness seem worse. But we don’t see it as really a systematic cause that’s leading to the highest echelons of populism around the world.

Ricardo Hausmann I mean, but still, I mean, the difference you the is at about 14 percent, Canada is about 24 percent. Is there something about immigration policy itself that might be different? Or I mean, do you think Canada and the US have the same impact on? I mean, immigration is always a challenge to the perception of social fairness or, you know, people might be. I mean, is it something about the preferences of the Canadians or is it something about immigration system that the Canadians have a differential system that the Canadians have been serving the U.S.?

Eric Protzer Well. I mean, there’s sort of two things I would know. First is that both sub nationally and internationally, we don’t see a clear correlation between immigration rates in practice, whatever the system behind it might be. And the consequential populism. But I would add that, you know, certainly insofar as that immigration system can amplify whatever pot, whatever you know, threats are, there are concerning economic unfairness. I think there’s certainly an argument that it can be amplified more if you have an immigration system that people perceive to be unfair. If you have, you know, for example, a point system like Canada where you’re bringing in lots of very high-skilled immigrants, there might be more of a perception that those immigrants are coming in and contributing to the system. Whereas if you have plenty of refugees or low skill immigrants or illegal immigrants coming in, it could be the opposite perception that people could become especially sensitive to that concern. You know, in a situation where they feel like they’re already being unfairly treated and we see these people who are coming in essentially, you know, in their view, breaking rules to enter the country.

Ricardo Hausmann We have a question at the core of your thesis in the Q&A that came from Julio Cesar Martinez, and he asks whether you’ve thought about whether economic unfairness could explain populist leaders in Latin America.

Eric Protzer Great question. So one thing I would say is that to an extent, the book certainly argues that the problem of economic unfairness is a near-universal concern. We explain in the book how both biological and cultural evolution press people to value fairness because it enables complex, four-point cooperation. And that’s I certainly would expect that people ought to be sensitive to economic unfairness in Latin America and that it could very well be a contributor to a problem there. I my coauthor and I wrote in a letter to the Financial Times about populism in Chile on that specifically. That being said, our analysis on the whole is concentrated on high-income countries for two reasons. Firstly, because it is perhaps so troublesome that so many beacons of global freedom, like the US and the UK and France have been susceptible to liberal populism, but also because in a lot of other parts of the world. And it’s not especially surprising that support for democracy is not as pronounced. There are long histories of trouble, demagogery and a lot of these countries and a wide variety of associated problems that occur there. So on the whole, I would say that it’s very plausible that it could be a contributing factor. There might be other things going on there as well, more related to the deep political history of the countries in question.

Ricardo Hausmann Very good. Muhamed asks an interesting question. Obviously there’s economic and unfairness and economic inequality. I mean, you argue that there might be unequal but fair outcomes. There might be also inequality that is the consequence of unfairness. If you have a guess or have to explore this question of how much of the economic inequality is the consequence of economic unfairness versus sort of like, fair but unequal?

Eric Protzer Yeah. So, you know, it’s interesting you ask that because while I haven’t personally explored that question, we do talk about other authors who have. And one common approach in the literature is to do something called inequality, composite body composition, where they take the existing income distribution in a society and they essentially statistically decompose it and they say, OK, what portion of that is arguably unfair because it’s explained by demographic determinants that really shouldn’t determine your success. Things like your ethnicity, your race, your gender, your place of birth, your parental wealth, your parental education, all those kinds of factors. One really interesting finding was that the growth of inequality in the US, this is one from a paper I think by Q4 can and people. The growth of income inequality in the US was largely there, for the most part from 1970 to 1990, insofar as most of that income inequality could not be explained by these unfair components. But thereafter, since about 1990, it’s become more and more unfair. Another really interesting angle on that comes from Serge Aurier, who’s the chief economist of the European Bank for Reconstruction and Development, where he did a paper doing the same kind of income inequality de composition for different post-Soviet countries in every country. And he found that the unfair components of income inequality was associated with less support for markets and democracy. But once you take that into account, the remaining spare components of income inequality is associated with higher support. So that’s that’s an interesting question, and it’s certainly the evidence that’s available indicates that things are trending in a bad direction.

Ricardo Hausmann Interesting. We have a question about what do you think about citizens’ wealth funds? Would you see the establishment of these kinds of vehicles in resource-rich developing countries as an antidote to populism, as if the money in some sense, if individuals could claim property rights on on on the natural resource rents instead of having been channeled through the budget?

Eric Protzer So I guess this is actually somewhat akin to questions we sometimes get about universal basic income in the United States. I guess the idea here is you set up some sort of common fund, whether it’s funded by resources or taxes, doesn’t matter that people get some sort of payout from that. I suppose my thought on that personally would be that I don’t see that as an especially good remedy to the problem of economic unfairness because the issue is not simply a matter of absolute living standards. It’s a matter of whether people are getting rewarded for their contributions for their talents and efforts. And that’s something that, you know, you can feel very frustrating and it has to be solved much more by complex policy inputs that enable somebody to get an education, get where they need to go. To compete in the market, to compete in a way is fair and to be rewarded for the value they create, simply distributing wealth to people. You know, maybe it can help in other ways to create a baseline freedom from poverty. But I don’t see it as a catch all solution.

Ricardo Hausmann There’s a question by Juan Pablo Fontana, who wants to know more about measures of social mobility, how do you go about measuring social mobility? What are your indexes for social mobility?

Eric Protzer Yeah, certainly. So the main measure that we use in the book is something that in the academic literature is called intergenerational income elasticity, and the way that’s computed is that you essentially track people and their parents longitudinally over time. It’s quite data intensive. And what you do is you compute, you know, to sort of simplify things, you compute the of the kids income at a certain age and the parents’ income at a certain at that same age when back when those parents were the same age. And then you check, what’s the correlation? There are, you know, there are these other things you need to correct for like lifecycle factors if somebody’s still in school, things like that. But essentially, it’s mostly that parent child income correlation in the same age that we’re using as a measure of social mobility. There are some other approaches that people use. For example, the World Economic Forum has a more holistic approach to a social mobility index where they consider what they think are relevant policy inputs to social mobility, things like access to education and, you know, the price of housing, the competitiveness of the market and whatnot. But those are sort of indirect measures. So we feel in our book and in the quantitative work that it’s best to hone in exactly on that problem.

Ricardo Hausmann In a very good team, we have another question in the chat by Osé alumnus, he asks If you think that the main problem is populist values endorsed by voters or authoritarian values embraced by voters and boosted by populist rhetoric? So is there, for instance, regarding anti-immigration attitudes? I mean, is it an anti-democracy and pro authoritarian? When people want change, the status quo may in the checks and balances prevent change. And so people say, Well, since I want change and democracy cannot deliver change, in some sense, let’s get rid of democracy and in the process, they need a populist rhetoric to justify that. Then that rage and that frustration with the status quo.

Eric Protzer Yeah, so, OK, there’s a there’s I guess, two ways in which I’d answer that. First is with just the definition of populism that we’re working within the book, which is that we’re classifying it as anti-elitist, combined with anti pluralism. The sense that there is, you know, some corrupt elite that’s rigging society, combined with the sense that only my tribe has the right to make political decisions and that other people are illegitimate. But the way in which you get to that place, I think, is important and speaks to that question. And I would say that it’s a mix of those things. Part of the problem is that when you have a situation of economic unfairness, we argue, is that, you know, you feel like you and perhaps your neighbors, your family, your community, you’re not being fairly treated, you’re not able to get ahead with talent and effort. And that causes people to look inward. You know, however flawed it might be, is the human response to become more inward-looking and tribal in terms of their community as and perhaps a somewhat anti pluralist source of political authority. I certainly think, however, that that is exacerbated by the particular political leaders who then, you know, show whatever direction that can go in. I mean, you might contrast Donald Trump with other political leaders in Europe like, I don’t know, you could even think of Nigel Farage or Boris Johnson, where maybe there’s a degree of quasi populism or even that degree of skepticism of immigration and things like that, but certainly not any direct attempts at a coup. So I do think that it’s a combination of those things. And as the title of the book might suggest, reclaiming populism. I think it’s certainly possible to channel those concerns into a liberal democratic direction that really addresses the substantive economic issues without going in a non-democratic direction.

Ricardo Hausmann Very good. You made a very interesting point in your presentation quoting an article. I forget the authors that the in financial crises were different from regular recessions in the public’s perception of their fairness. Have you thought about the perception of the pandemic? How is this recession and the pandemic jive with your discourse and your framework?

Eric Protzer Yeah. So I mean, first of all, without even getting into the issue of economic unfairness, I think it’s important to note that certainly there’s been a populist reaction to the pandemic and the restrictions that come along with the pandemic, perhaps an interesting and surprising ways in my home country of Canada. There is a huge convoy of truckers that are descending on will have descended on Ottawa, as you’ve probably read in the news. And people are essentially, you know, saying, well, they’re very populist. Is this Canada’s populist movement? So there’s definitely an element of that to begin with. And I would say that that, first of all, comes from certainly a sense of unfairness, however justified or unjustified it may be from those kinds of citizens where they feel that there are, you know, restrictions being placed on them that that, you know, they think are unfair. But I would add that, you know, the trucker convoy into Canada has not made, for example, the country completely unrecognizable. It’s not like this has spilled over into a broader grievance that resulted in something like Trump, where the US before and after is not the same country or Brexit, where the UK before and after is not the same country. And the reason for that is because it hasn’t tapped into a deeper sense of economic resentment that people can’t get ahead on their own, their own talents and effort. I would add to that, though, that there is also an economic element to the book. I are sorry to add to the pandemic, insofar as there has been differential policy responses to it. You can imagine that in some countries, people have had an easier time getting access to monetary relief from the pandemic, or an easier time navigating all the checks and balances surrounding vaccines, Typekit certification and masks and whatnot to be able to go and get back into the workforce. So there certainly is also an economic element to it that can play out.

Ricardo Hausmann Very good, we have a couple of questions, and I think we’re running out of time, but let me state them. From Stefan Trim, he congratulates you and asks, you know, does the degree of trust in government, in cross-country comparisons influence toleration of unfairness or in a government in some sense, compensate for unfairness? And from Signa, what if economic policies lead to the populism of the right? As in India, where religion and caste equally affect social mobility? Is economic liberalization enough? Have you thought about the case of India, where were so like the resurgence of a Hindu identity as a core definition of the nation is at stake vis a vis a more, you know, a Congress party approach, which was more ecumenical, if you want? So so those are two last questions.

Eric Protzer Certainly, so to answer the first of those with regard to trusting government and quantitative analysis behind the book, we actually look at surveyed confidence in government from the world Gallup poll and and we use that as a factor to investigate. And we say, well, what leads some countries to have higher confidence in government versus lower confidence in government? So to begin with, I would say that that is an outcome variable that you can sort of use to proxy for populism. Other authors and literature have certainly done that as a proxy for populism. In addition to that, though, I think that to give a short answer, yes, there can always be a country sort of fixed effects that both change the shape that populism will take and perhaps can make it slightly contained or slightly worse. Um, you know, for example, one interesting country is Switzerland, which is such a bit of an oddball case because it simultaneously has relatively high degrees of populist voting, but also relatively high degrees of confidence in government and trusting government. So it’s it. You can’t have an interest in cases like that where, you know, if you have better institutions and better trust in those institutions, I think there probably can be, to an extent, a mitigating effect. That being said, of course, once you’ve gotten to a point where people begin to lose trust in those institutions and begin to think of alternative arrangements, you can very quickly go down a slippery slope into another situation where you’ve got a historical precedent for illiberalism and that can carry on with regard to the question of India. I mean, this is one of the reasons why we concentrated on the developed world in the book because there’s sort of a reasonably uniform value standard across those kinds of countries. And there’s not these huge issues of, you know, for example, case, which I completely agree with you. That case is a major inhibitor of social mobility in India, and it’s not simply a matter of economic liberation to do that. And that’s why, for example, in the tree of policy inputs that feed into economic fairness and social mobility, you might recall that freedom from discrimination, both in law and in culture was a critical input, and that’s where that would be very, very relevant for the case of India.

Ricardo Hausmann Very good. Well,  thank you so much, Eric. Thanks everybody for participating and this has been, you’ve really thought deeply about all of these issues and know your own thoughts and the literature amazingly well. So congratulations. A very, very interesting book. And great success with its distribution.

Eric Protzer Well, thank you so much and I want to thank Ricardo. I want to thank Chuck, and I want to thank everybody in the audience for coming to the talk today. I hope this has been illuminating and reminder you can get the book on Amazon, on Polity’s bookstore, and at bookstores everywhere.

Patricio Goldstein: [00:00:05] Hi, welcome, everybody, to the Growth Lab’s new Development Talks series, thank you all for being here. My name is Patricio Goldstein and I’m a research manager at the Growth Lab program at the Harvard Kennedy School. And I’ll be moderating this session called Economic Policy During COVID-19: Addressing Old and New Challenges with Maria Antonieta Alva, Former Minister of Economy and Finance of Peru. We’re very happy to have Maria Antonieta with us today. But just before I introduce her, let me tell you a bit about where we are today for those that joined us from the web. Development Talks is a series of conversations with policymakers and academics working in international development, organized by the Harvard Growth Lab. In case you didn’t know us, the Growth Lab, based at Harvard University’s Center for International Development, is a research program led by Professor Ricardo Hausmann, who is also joining us in this session, working to understand the dynamics of economic growth and to translate those insights into more effective policymaking in developing countries. This Development Talks seminar provides a platform for practitioners and researchers to discuss the practice of development or analytical work centered on policy. The seminars take place on a bi-weekly basis. If you want to stay up to date with our research and then you can visit our website or follow us on social media or sign up to our quarterly newsletter. More information can be found at growthlab.cid.harvard.edu. Also would like to invite you to attend our next Development Talks seminar in two weeks time with Dr. Antoinette Sayeh, deputy managing director of the IMF. [00:01:37][91.7]

Patricio Goldstein: [00:01:37] Now, without further ado, I would like to introduce today’s speaker. Maria Antonieta Alva served as Minister of Economy and Finance of Peru from 2019-2020. Before Maria Antonieta served as minister she had worked in public administration for more than 10 years. She was Director General of Public Budget at the Ministry. And before that she worked in various positions not only in the Ministry of Economy and Finance, but also in the Ministry of Education and the Ministry of Development and Social Inclusion. Also worth noting for our Kennedy School audience, Maria Antonieta has not only BA in Economics from Universidad Pacifico, but is also a graduate from the Master of Public Administration and International Development at the Harvard Kennedy School. We are honored to have her today. [00:02:21][43.8]

Patricio Goldstein: [00:02:22] The format for today will be the following: I have a couple of questions here to kickstart the conversation and then we will take some questions from the Growth Lab team. And finally, if we have some time, we will open up for questions from the broader audience. If you have questions you would like to ask Maria Antonieta and I will ask you to please sign them in this Q&A button that appears right below in the Zoom window as well as your name, affiliation, and country so we read it out loud and we’ll keep some of these and ask Maria Antonieta. [00:02:50][27.7]

Patricio Goldstein: [00:02:51] So now that we have a full house, let me just start. So Maria Antonieta, Peru has shown an exceptional economic performance over the last two decades, resilient to global headwinds such as the global financial crisis and the end of the commodity supercycle. Nevertheless, as the COVID-19 crisis hit Peru, the country has suffered major economic losses amongst the highest in the Latin America region and has particularly struggled containing the spread of the virus. More recently, the recent polarized election after four presidents in the last five years has shown significant democratic malaise. I want to take this opportunity to ask in this context my first question. Do you think the Peruvian economic model has been a success so far? [00:03:38][47.4]

Maria Antonieta Alva: [00:03:41] Hi, I’m very glad to be here, so first I want to… because what we have here, people from different countries, when we talk about the Peruvian economic model, maybe I am oversimplifying but I think that we need to consider that this model has three major components. First is the macroeconomic stability management, a huge compromise with discipline in the public finance management. The second is an open economy to trade, and the third is a proactive promotion to private activity. So I think that to be fair, I think that the model has concrete results, but the results of the last elections show that the model has its limits. If we just think about economic growth, I think that it’s a model very dependent on commodity price and we have not fostered sectors with high value added. So, for instance, in Peru, the agro-experts boom this miracle that they call about the export sector is more an exception than a rule. To the model, I think that there are three major limitations. First is that notion and this really probably is not specific to the model but I think to the common understanding that we have to advance I think that’s the first a limitation is that there is an idea that economic growth was sufficient. What we goal in Spanish ‘el chorreo economico’. Definitely the economic growth of the country in the last years has not been inclusive and there was a huge incapacity of the state to distribute wealth. We always see that we have this circle where you have economic growth that brings high tax revenue and this should be translated into better public services for citizens. But that is not the reality in Peru because the state has a huge incapacity to deliver concrete results to the citizens and think that’s what we have seen in the last COVID crisis. How can this economic star of Latin America have less than 100 intensive care beds for 3,000,000 Peruvians when the COVID started? So this is just is an example that basic services has been neglected for the majority of Peruvians. This is the first limitation I see. The second is, I think that there is a lack of a real commitment with regulating markets. So sometimes when we say that we embrace the free market, but we haven’t built the institutions and the tools for ensuring competitiveness in the market and for sanctioning the cases that we have power abuse of this dominant position in the market. And also during the COVID crisis, we saw how concentrated markets such as the Oxygen market or the pharmaceutical market generated a lot of frustrations in citizens so, in fact, I think that in last Christmas we had collusion in the price for turkey in the supermarkets where you have a lot of these abuses of dominant positions in the market. We say we love the market, but in practice, there is no free markets in many markets that are relevant for the citizens. And the third one, I think that there is an absence of institutions that represent the vast majority of Peruvians, that represent their concerns, that put their concerns in the agenda, but also that intermediate every time that we have social conflicts. I don’t know if this happens in other countries, but the office of the Prime Minister in Peru has a big social conflict office. Most of the most troubling times the Prime Minister has is because of the social conflicts. And here I am not just talking about political parties. These political parties is just a feature. We have lots, for instance, of informal workers than in other countries. And Argentina, they have like a body that represents them. So, I think that this is also a major problem – not being able to represent the majority of Peruvians in the agenda. So I think that’s… the results of these elections, as you already mentioned, has shown these problems and the limits of the model. [00:08:00][259.2]

Patricio Goldstein: [00:08:01] I think that’s extremely interesting. And I think the three points that you bring up: both in capacity for the state to manage wealth and provide public services, for the lack of commitment to regulate the markets, and the absence of institutions to represent the mass majority. We can only link them to the provision of quality public services such as health and education vis a vis in this tool. So on a prospective basis, what do you think could be done differently to improve the quality of health, education, public or private? [00:08:32][30.6]

Maria Antonieta Alva: [00:08:35] I have thought a lot about this in the last year, I think that if we review what has happened in the last decades in Peru within public sector institutions, let’s think, for instance, about macroeconomic stability and fiscal management, we decided after this huge crisis by the end of the 80s that we wanted stability and we build those institutions that bring us stability. We have a central bank. And in fact, Julio Velarde has for many years been considered the best central banker of the world. We put some rules and laws for compliance with fiscal rules within the Ministry of Finance. We also built Superintendencia de Bancos y Seguros, is the agency that oversees the financial services. I have been thinking a lot about this, we build these institutions, these strong institutions because I think that the establishment needed those institutions. So they generated a lot of pressure to have these and create these institutions because there is a simple notion that you cannot privatize those services. You cannot ask the private sector to give you policy or monetary policy, or you can’t ask the private sector to bring you fiscal policy. So there is no coincidence that we have these institutions that provide services that cannot be provided by the private sector. We generated really, really good institutions. We generated all the conditions to have the best civil service. So the central bank and the SBS have special regimens that are there are OK, there are meritocratic, they have better salaries. They are some stability. So this is not bad. This is just understanding that in order to provide good public services, you need the best people there. But what happens with other services? I will say that in comparison to these ones that bring you macroeconomic stability. What happens to those services that bring you like, social stability or social development? What happened with education, what happened with health, even security? I think that the establishment realized that they can consume those services in the private sector. So we have no pressure in the public sector to deliver good public education, good private education. But we went to the private sector and now you have a huge segmentation when you have families that can really buy very good education, but very expensive and you have families that do huge efforts to pay $20 or $30 each month for a school fee. And they have really, really bad education because these are schools that work really good for the elite they decided, “OK, we are fine like that. We don’t want you state.” And every time the state wants to improve the agenda of regulating the private services, the private provision of schools, we have huge problems there because the elite doesn’t want them to be regulated. So I think that we are in a very, very terrible equilibrium where we have normalized privilege. We have normalized the fact that if you want to have really good education and you want to have really good health, you need to have money and consume that in the private sector. So I think that the government in some point or the public sector has resigned to provide good public services, but it has also resigned to supervise the quality of the private sector. So I think that we are stagnating in this equilibrium and we need to get out of there. [00:12:25][229.4]

Patricio Goldstein: [00:12:27] And do you think we’re heading to a political moment where change can happen better? [00:12:30][3.2]

Maria Antonieta Alva: [00:12:34] To be honest, I think that my huge concern is that improving living conditions for Peruvians is never in the agenda, never. I don’t know, like we are stuck in the last, I think, month about elections and a lot of fragmentation. But nobody is very conscious about what is happening with the anemia, what is happening with learning outcomes. So I think that the population is very frustrated with the outcomes, but I don’t see really a commitment to improve significantly the delivery of public services. [00:13:21][46.5]

Patricio Goldstein: [00:13:23] Definitely. I want to change the topic to COVID-19 since its the title of the conversation, and you took over office in the Ministry of Economics and Finance in October 2019 and five months later, we have the first confirmed COVID-19 case in Peru. And then suddenly the entire policy world and our teams at the Growth Lab really know this. And it’s not just health ministers, the finance ministers, pretty much everybody. We’re all forced to learn an entire new vocabulary. We learned what a lockdown was, what a non pharmaceutical intervention was, what flattening the curve, and testing and tracing. And I wonder, as a Finance Minister, you also have to adapt to this new reality. So I wonder, what was the hardest thing about it? How did you go through it? [00:14:10][47.2]

Maria Antonieta Alva: [00:14:11] Yes, I think that we need to remember or understand the nature of this economic crisis. Usually as the Minister of Finance you face economic crises that are related to economic variables, such as an acquisition of a crisis of debt in another country or overheating of the economy. In this case, the origin of the crisis was tentary and in front of the impossibility of the health system or the sanitary system to address this crisis, you came to an instrument of economics to try to help in the response to this crisis and to be like numbers in Peru were really, really tough. As I already mentioned, by the beginning of March, we had less than 100 intensive care beds for 33 million of Peruvians. So we implemented this very aggressive lockdown in order to avoid a collapse in the health system, but also to provide some, of course, resources. And the idea was that in doing this, lock down the health system was able to strength and to avoid collapse. So in this context, when you ask the Minister of Finance face a crisis that doesn’t have origin in economic variable but in a sanitary crisis, I think that I have two reflections there. The first is that there was not a manual, there was not literature. There was a lot of uncertainty. People doesn’t remember this, but the first case that we have in Peru was March 6, at least the first formal case. But in a press conference in March 30, WHO was saying that the face masks were not recommended. So imagine that, like policymakers, we didn’t have so much information. So lots of uncertainties. And the second reflection is the errors that happens here are paid human lives. So as Minister of Finance, you understand that your field of experience is not enough in this context, like closing or opening the economy again. So I think that ministers of health played a key role now in the management of this crisis. You really need to work very close together with them. And I know that in some countries was discussed about this paradigm between health versus economy. And I think that for us in the government, what was clear is that we wanted to avoid the most human losses. So we didn’t face really like this huge paradigm. We didn’t have a huge fight between the ministry of finance and the ministry of health. But we had very, very difficult structural conditions because of a very, very weak health system. [00:17:20][188.2]

Patricio Goldstein: [00:17:23] That’s very interesting, and we heard from our work at the Growth Lab with all our counterparts, a lot of countries have very similar conditions in the developing world. I was wondering, particularly regarding lockdown’s and I know that lockdown’s and non pharmaceutical interventions such as closure of borders and schools have been a big part of Peru’s mitigation strategy, as you say, in order to avoid a collapse in health system. And given low numbers of beds and doctors to begin with. Peru was effectively the first country in Latin America to implement a lockdown that was followed by others, Argentina, Chile, etc. And I wonder, what do you think, one year later, about how lockdowns have worked? Do you think they worked in practice? Do you think something could have been done differently? [00:18:11][48.1]

Maria Antonieta Alva: [00:18:14] Yes, I think that there is lots of diversity within countries and it’s difficult to identify common trends. And also another important feature here is the counterfactual that is very difficult to measure. Like in Peru, with this lockdown we had two waves. Maybe without a lockdown, we won’t have two waves but we have a tsunami. But it’s very complicated, this idea of the counterfactuals and this idea of identifying trends. I think that in order for the lockdown’s to be effective. I think that there are three important variables here. The first is early detection. You need to implement the lockdown at the earliest stage of the infection. And even though we were the first country to do this lockdown, I was reviewing some experts… this was… we gave the lockdown by the mid-March. I was reviewing some documentations and some papers that are from some experts that they suggest that in Peru probably the infection started before that. Before that, the Ministry of Health, really say this is the first case on March 6. So this is something about early detection and having a lockdown timely. At that time, we had a very quick response, but some initial analysis reflect that probably that the virus was there many weeks ago. The second is about the intensity of the lockdown and this is related to whether or not you almost close the territory, you close airports, you close interprovincial transportation. And I think that in the case of Peru, we can say that when we implemented that lockdown, we like blocked the virus in Lima and we delay the infection in other regions. And this is very important because if you had the levels of infection that you had in Lima, that is a city that has a third part of the population, and the system was already collapsed. At the same time, you had that infection in eight major cities. I really don’t know what will happen. Like we had Lima and then we had Loreto and then we had, like, regions started. So I think that… I haven’t checked evidence or have a regression on this. But I think that we were able to delay the infection in different regions because it was impossible for the system to handle infections in major cities at the same time. And then the third component is about enforcement, whether or not there is a system and whether or not the culture of your citizens really, really respect the law. And you can also see that in Peru in the first week, the mobility index really, really was stagnating in low levels. But then you can see that people start moving around. So I think that these three things are important in the moment of deciding a lockdown. [00:21:24][190.4]

Patricio Goldstein: [00:21:26] If I could just follow up, like I think it’s interesting that it happens in a lot of countries where we work where there’s high degrees of informality, so like curfews generally are not as effective in preventing people who need to make a day to day living particularly high levels of self employment, or people need to go to something everyday. I think I saw a question in the Q&A about that. How do you think this interacted in Peru’s case, with Peru’s high levels of informality? [00:21:49][22.6]

Maria Antonieta Alva: [00:21:55] I think that the most important tools that the government designed for reacting to the crisis. Were not like that. In respect of 100 percent of effectiveness, we didn’t get that because of informality. As an example, for instance, because of this informality, we decided to implement a massive program of cash transfers to households. And when we approved very quickly all the laws that were required for that. When you start with the implementation, you face these structural barriers, such as like in Peru, only four of ten adults have a bank account. The infrastructure of the National Bank had less than 1,000 ATMs at that moment for all the country. So even though we had this idea of giving liquidity to the households, it was very slow because of these structural problems, informality here, we didn’t have even the data sets, we don’t have any information of the citizens. We have to build a data set on that. So I think that yes, informality was a huge barrier for implementing all our tools and all our response to the crisis. [00:23:18][83.3]

Patricio Goldstein: [00:23:21] You mentioned that the transfer to households, I think for some of our non-Peruvian audience might not know this, but Peru has one of the largest fiscal packages in the region. And I understand there’s long discussions about the implementations of some of these programs within the public sector, within the private sector, particularly regarding the loan guarantee. But even with all these as we are going through these discussions, I wonder if you could tell us a little bit for the audience, what measures did the government when you were Finance Minister took in response to a pandemic, economic or social? And I even have like a question here that ask about what did Peru do to improve public services during the pandemic? And is there anything that you think that could have been done differently as well to minimize the effects of the crisis? So two parts first informative just to get us all up to speed and second what do you think about that? [00:24:13][51.8]

Maria Antonieta Alva: [00:24:15] Yes, I want to also tell this story that the first day that we were supposed to have a cabinet of ministers to approve that the supreme decree of the lockdown that day at 7:00 a.m., I had this meeting with the former president and Julio Velarde the president of the central bank. We were very early with there talking about this lockdown and Julio told me something that was really important. He told me like, “Toni, your best economic plan is to support the Ministry of Health to contain the virus that you need to get rid of this virus that is your most effective economic plan now.” So we decided on an economic plan. And I also have to say that Professor Ricardo Hausmann, Professor Andres Velasco, they were really, really important for us. We have several discussions with them. Our plan has two phases a containment phase and an economic reactivation. Of course, in our minds, we wanted the containment phase to finish the earliest possible to start with the economic reactivation. Going in these two phases, of course, depended at that time a lot in sanitary variables. The plan was 20 points of the GDP, around eight points is public budget then and the other big chunk is 11 points of the guarantee for credit loans this very famous program, Reactiva, that for me is the best example of the combination and interaction between fiscal policy and monetary policy. And within the plan I think that we define three major priorities. First was strengthening the health system. The second was to protect enterprises and households. So in the first, you have all the money that we gave to the sector to improve their capacity. Then the second was protect enterprises and households. And then we have this cash transfer program. And the third was liquidity measures like a massive injection of liquidity in the economy to avoid a collapse in the payment chain and enact Reactiva. And as I already mentioned, I think that the main takeaway is that the structural gaps in the country were huge barriers to deploy the instruments in the way that we designed them. That’s what I already talk about with the cash transfer program. So in the first one, and this is related to the question about strengthening the health system and this is related to this idea of how we build capacity. At that time, we had two big issues, like we have all the issues of the clinical aspects of the pandemic, and then we had to build capacity, we needed more intensive care beds. We need more hospitals. So what we did and the Ministry of Health was really collapsed by the clinical and the sanitary issue. What we did is we generated a legal, a special legal framework and bring to the table the most effective units of the government in executing budget and implementing procurement process and in fact, implementing things. I don’t know if you remember about two years ago of that we had the Panamerican Games in Lima and the unit in charge of all the implementation was very, very effective. They have a huge reputation of being very, very good deliverers. We built all the legal framework and we brought to the table like three or four special units to help the Minister of Health, to build temporary hospitals, to buy all the equipment required for intensive care beds, even an agency independent from the Ministry of Finance supported that the Ministry of Health in buying rapid and molecular tests. So we just bring to the table very, very effective agencies to help with all the implementation. And so the Minister of Health can focus on the clinical and we had to generate urgent decrees to do all of that. Then we have this massive cash transfer. It was to 8.1 million households. That is almost 60 percent of Peruvian households. And as already mentioned, we have huge barriers for giving quickly the liquidity to the families, not only because the low levels of social or financial inclusion, but also the national bank didn’t have so much ATMs. Going to the bank you have this population that really wants to go to the bank and take out the money from there, so that was also a point of spreading of the virus, so we had huge challenges on that and we don’t even have a complete registry of citizens. So we had really to build like almost like a new registry where you can tell that we had a huge problem with having the information of our citizens that can really tell you how much the state is connected to citizens. Then we have Reactiva Peru that was this a program where we gave loans to enterprises. The money, the liquidity was from the central bank. The Treasury guaranteed these loans. And I think that a very important innovation… we had this… we wanted to really have very low interest rates for this program. So the central bank the way they allocated these funds within the banks and the financial institutions was through auctions. So each one in this auction, the money was given to the financial institutions that presented the lowest interest rate. So the impact there was really, really important, for instance, in Peru in a regular moment the interest rate that small enterprise face in the financial system can be 40% of interest rate. In Reactiva, it was less than 2%. So it was really, really a very innovative program. And I think that Reactiva may have customized a very similar program, for instance, customized to agriculture. I think that at the end we gave these loans for almost 800,000 enterprises. And then this was part of the contention and during the reactivation that that was by the second part of the year, in addition to opening the economy, and that was also a political economic process, when you have to select what to do with the casinos, what you will do with the charges, it was also like a political economic situation there. We decided on specific public investment interventions. As Minister of Finance, we worked really close with ministers of transport, with these ministers that were supposed to design… we designed a massive program for fixing roads, for instance, and we developed a standardized terms of reference for local governments for all the procurement process of the system. And then we had daily monitoring of the execution of the funds and and in the middle of the crisis. That was a complicated crisis. I had also to do damage controls in some populist laws from the Congress. There is, in fact, one journalist that referred to the situation as Peru was facing two pandemics, the coronavirus and the populism from the Congress. This Congress was a Congress that had only 18 months to deliver results. I don’t know if you know, but the Congress was closed by the President they called for a new Congress. So you had new Congress that has 18 months to deliver results in a pre-electoral moment because the political parties were going to participate in the electoral process for the next year. So I had to do a lot of damage control there. I invested a huge amount of my time going to the Congress. And not only I had to go to explain why I always tell them, like you know, Peru doesn’t end with a pandemic or with the elections, we have a country to build, we have to think about new generations. And these laws that you are proposing will generate more problems than solutions. So that was a very important part of my time. And in fact, I was also interpelled twice by the Congress. So it was really, really difficult times. What I should have done a better? I think that we had a huge issue about the pension funds. Finally, the Congress approved a law that was declared unconstitutional by the highest body that interprets the constitution. So maybe there I think that I had to react on time. I took a while to send up counterproposal of this law, to the Congress. And the other was about the narrative. I think that also I was very criticized by the Congress because of not helping the small and medium enterprises. And that speech was already in the minds of everybody, even though Reactiva, most more than 90% of the loans were given to these enterprises. Like what? This speech was already there. So I think that I should have been more like better communicating what we are doing with small and medium enterprises. [00:34:41][626.1]

Patricio Goldstein: [00:34:42] I think we can take up that point because I have two questions in the Q&A exactly about small and medium enterprises. So maybe I’ll just read I have one from Andrea R. who asks us, “The Reactiva program… some people criticize the program because it mainly benefitted big business and there was little to no support of small or medium enterprise, what do you do to support businesses who are not benefiting from Reactiva?” And I have another anonymous question that talks about the high tax burden for small businesses and also what has been done for small businesses? So perhaps just spend a minute or two talking about what was done for small business. [00:35:16][34.1]

Maria Antonieta Alva: [00:35:18] Yeah, that is part of… there is this narrative about Reactiva and the small and medium enterprises, and the fact is that the numbers are there like more than 90% of the enterprises that receive the loans were small enterprises. Of course, when you think about the amounts, the numbers are reduced because you are giving them to pay off the payroll for three months or to pay for expenses for three months. So, of course, their expenses were lower than huge enterprises. But I think that the problem that we faced was informality again. Most of the information to identify these enterprises was from the tax administration. So what we have in Peru you have small enterprises that half of them are formal and the other half is informal, so that information that we had at the moment didn’t allow us to help all of them because they were informal. So they didn’t appear like the amount of the money they need or how much they sell their sales were not reported in the system. So knowing about that, knowing about Reactiva and that problem we generated other programs like FAI – Fondo Apoyo Impresarial where we at some point were much more flexible about the requisites for receiving the loans. But I think that in general there is a huge problem of productivity with small enterprises that explains informality. What I was also very conscious about was that during a crisis like we saw the crisis, the small and medium enterprises, only 5% had loans in the financial system. So I knew that in a crisis it was impossible to solve on the structural problem. I was conscious about that. I couldn’t during the crisis solve that. But I think that what we gain in reduction of interest rates, the example that I gave you from 40% to less than 2% was really impressive. [00:37:38][139.8]

Patricio Goldstein: [00:37:40] Thank you. And so eventually vaccination will advance and Peru and the rest of the world will all reach herd immunity and the COVID-19 crisis will be left behind, hopefully for everybody. Nevertheless, there are enormous challenges ahead for the rest of the world, for pretty much everybody. In the case of Peru, we know at least from private and multinational projections, that Peru is not expected to recover its 2019 income per capita until 2023. And of course, the current election leaves a lot of uncertainty about the country’s political future. So I was wondering in this context, what do you think will be the most important political and/or economic challenges in the year ahead? [00:38:24][44.4]

Maria Antonieta Alva: [00:38:27] Yes, I see like when we see the results of this election and when you see social media, when you see what is happening in the country, I see that we have two extremes. The first extreme is defense of the status quo, that for me, it doesn’t make sense. The actual system is functional for only a minority of Peruvians. So defending the status quo is not a possibility. But you have some one extreme that wants that and then you have the other extreme radical change that they don’t even want to maintain what already works like the country has demonstrated that we know how to be disciplinary in our public finances. Of course, that has enormous good results every time we want to issue bonds in international markets. So there are things that we have done right that we have learned how to do. So you cannot just destroy that so my real concern is that the country, politically and economically, I think that is part of the discussion. I always remember Andres Velasco saying that economy and policy go down the same road. I think that the huge challenge for Peru now is to reach growth and development that includes the population and not only work in that line, but I also think that we need to build a political party that represents responsible change, that represents the middle, like you have extremes. But I think that we don’t have institutions or spaces that represent what most of us think, because if you see like numbers, I think that less than four million Peruvians voted for one option or the other. So I think that’s the challenge for next year is to build on this story about responsible change, about development that really includes much more people and also to build a political force that represents that. And the political force that values pluralism, and I think that this is very relevant in Latin America because we are seeing lots and lots of populism, and I think that populism sometimes wants to sell themselves as they are pursuing the public interest, but they are not. So I think that and to be honest, it’s very difficult. And it was a position I had sometimes, like there are these popular laws, for instance, getting money from your pension fund. That sounds amazing. That sounds very popular. And you have to be the one that stands there and says, “No, this is not good. I am not going to support this initiative.” So I think that it also takes having a political representation that really thinks about the center and really things about, “OK, let’s do a responsible change.” [00:41:35][187.5]

Patricio Goldstein: [00:41:37] Thank you, Maria Antonieta. I would change a bit the topic and ask you one question and then I’ll open up for Q&A. If anybody wants to start writing down questions, we will get to them in just a few minutes. So you became Minister of Economy and Finance with more than 10 years of experience in the public sector. But you are still the youngest person to be in this position. You are also the third woman in the Finance Ministry in a country that had 270 Finance Ministers (I had to check that out). I wanted to ask did ageism or sexism ever come into play during your time as Minister? [00:42:14][36.8]

Maria Antonieta Alva: [00:42:16] Yes, yes, I think that definitely. When I was appointed Minister, I was already working more than 10 years in the government and I had a position really relevant at the Ministry of Finance that I was the General Director of the National Bureau of Public Budget of that country. So I was in charge of this office that is for me is the heart of the Peruvian government. I was appointed at 34 years old. In fact, there was some years ago a man that was also appointed at that age, but nobody said anything about he was like a star you know. Nobody when he was appointed Minister at my same age and nobody talks about his age. Now, I think that there was a part of the population that was trying to understand why I was appointed Minister. So they came with the first reason is that my father was supposed to be friends to the president. That was one explanation. That is not true. To be honest, my dad has been professor of I can say decades of civil engineers in Peru. He’s a professor and most of civil engineers that went to this university, my dad has taught them. So the former president was his former student and that’s… but with this I explained that my dad was a very close friend of the president. And because of that, I was appointed. That was not true. But the second explanation was that because of my age, because I was a woman, I was going to be like a puppet for the president. And I wouldn’t be able to say a no to him, but they didn’t realize, if you know, a little bit about the government. You realize that a General Director of Budget, you have to say a lot of no’s because lots of people, lots of ministries, level of mayors will ask you for money. And then so that was the first reaction. And then when I was Minister, sometimes they talk about how I was dressed. I didn’t wear makeup. Sometimes I had a I don’t remember how you say, ojeras, and sometimes they appeared in the media like, you know, the Minister has eye bags. And I think that for a guy, I don’t think that is a case for a man. But, yeah, it was difficult also in that sense. [00:45:06][170.0]

Patricio Goldstein: [00:45:08] And I guess given all that we talked about like the experience through COVID-19 it must have been incredible work hours and presented challenges. So I have to ask this: would you go back to public office in Peru? [00:45:19][11.5]

Maria Antonieta Alva: [00:45:23] Yes, yes, I think that’s my vocation was to be a public servant, I am trained for that. And in fact, since I started my professional career, the only two opportunities I have not been serving in the public sector was my two years at the Kennedy School. And now that I as you know, I had to leave office because the president was impeached. I really and I have two reflections here. The first is that I really think that more ministers in the country have to have to come from the public sector. In the public sector, you are trained to stand after the country’s interest and you are trained to look for the common interests. And if you compare this to experience in the private sector, imagine like the most important bank of the country in order to select their CFO, they will never think about someone that has never work in the financial system. So I really don’t understand why when we sometimes appoint ministers, we think, like in the private sector, will never put someone that doesn’t have experience there. Why when you have to appoint a minister, you need to put someone from there? And I have a lot of critics. In Spanish we say like revolving doors. I am very critical about those people that is minister then goes to the private sector, to the bank and then come back. I really think that the government needs ministers that are trained in the public sector. And the other important thing that I have to tell also is that it’s very difficult nowadays to be a public servant in Peru. I think that there is a huge disincentive because sometimes you are dealing with a judicial system that is not necessarily operational. You don’t know how they’re going to react so you have lots of preventive operations to former presidents, not necessarily with all the reasons. And I think that we are also in a very perverse equilibrium where you have media that reproduces fake news and sometimes disinformation is used by the prosecutor of the government. So you have there a lot of things that you can be acting right. But you don’t know at the end of the day what the judiciary system, how they will react. And I think that is really relevant. I was thinking the other day that, of course, in doing the crisis, public servant had to take risks. For instance, in Chile, they bought cineback that I am sure that when they bought it, they really wanted to ensure that the country had the most amount of vaccines. And then you have that is not as effective… If you do that in Peru, I am sure that the Minister that was part of that decision will have the prosecutor attorney of the government. So I think that it’s very risky now for a public servant to take decisions because you have this perverse incentive. [00:48:46][203.6]

Patricio Goldstein: [00:48:48] I think both comments are extremely accurate for many of the countries we work with. I have a last question and then I’ll give Ricardo the microphone but I have to ask this because we are at the Harvard Kennedy School, at least virtually right now. And you were a graduate of the MPA/ID, the International Development Program at the Harvard Kennedy School in 2014. And I wanted to ask, how did your experience in this program prepare you for the challenge of public office? [00:49:14][26.2]

Maria Antonieta Alva: [00:49:17] I think that there are three important things. The first is this idea that the trinity of public policy. Each good public policy needs to have a technical, rigorous design, then thinking about how feasible it is in the territory and then the political decision and be able to transmit why this is important. I think that this triangle was really, really important for me. Of course, depending on the position that you are in the government, you need to build your gaps. As minister, the communication part I had to invest many hours in training every time I went to interviews. But I think that this idea of being conscience about these three important factors and also this triangle also tells you that you need to work with teams in the government because one person doesn’t have all the competence to develop all these three things. The second is what our Professor Dan Levy always told us, that we had to be smart consumers of data. And when I was a Minister, even though I came like, if you are Minister of Finance, you can come from the economic side or from the Treasury side. I came from the Treasury side and most of my training was there. So now, as Minister, I had to deal with eight or 10 General Directors of different topics. And I remember my basic econometrics class was really, really important to try to follow, even though some topics were new to me I think that that was really fundamental. And the third is the network like it was amazing during the crisis. I would just send a chat to my WhatsApp group of my friends from Kennedy School and ask them, what are you doing in this issue in Colombia, in Chile, in Mexico? And they will just answer to me. And the other are the professors, like Michael Walton, Ricardo Hausmann, Lant Pritchett that they were after being a sort of finishing my master they were always available there to help you in different situations. I don’t recall all the Sundays that Ricardo invested in meetings with my team in the Ministry of Finance, so I am very grateful about that. [00:52:00][163.2]

Patricio Goldstein: [00:52:05] OK, let’s try then using this opportunity to try and get Ricardo online to make some comments. [00:52:10][5.0]

Ricardo Hausmann: [00:52:15] Thank you very much, Toni, for this splendid and frank conversation. I have two questions for you. The first one has to do with you know, what are the lessons in terms of setting in the government itself up to learn from its own actions. That is, we know at the beginning that we didn’t know much about the pandemic and we didn’t know much about these non pharmaceutical interventions that had to be made and so on. But you know, when looking at the data what’s amazing about Peru is that you have these peaks, but in many countries these peaks are followed by a trough. But in Peru, it’s these peaks are followed by a highland before they come down so they’re very long these peaks. And I was wondering if there’s anything about having mechanisms for the government to learn from its own actions. And I don’t know if there was an adequate interaction between, say, the health ministry and so on and the rest of government in terms of thinking through what was working and what was not working, that’s with respect to covid. But I was really impressed by what you said at the beginning about the fact that there’s very little a commitment from, say, the establishment for basic services like education and so on, and some things that came back to haunt you in terms of the systems that were not there when you needed them, but in particular in education, you spent some time in the Ministry of Education. I believe that was when Minister Jaime Savedra was there and that that ended up being sort of like rejected by the political system. When there was a real attempt at improving education it kind of backfired. What can we learn from that backfire? What defends lousy, lousy education? [00:54:38][142.5]

Maria Antonieta Alva: [00:54:41] OK. The first question, I think that in some way like many tools that we implemented were done from scratch. For instance, Reactiva, FAI, the lockdown and opening the economy. So I think that within the government we have learned from… I don’t know in what process probably is less important to have public servants there always that are able to stay for a long time. I think that, for instance, programs like Reactiva, we invested in all of this time and now the transition government is able to like re-program the loans or think about other sectors. And also I think even if the lockdown of the economy and opening the economy, we learned a lot. And you have now that… I think that at the beginning we didn’t have much more information because also I think of the informality. For instance,we also locked down mining, but I think that in Peru and mining really explains like 10% of your income, it’s a huge part of your GDP, but it also… We have a lot of social conflicts with mining. So it was difficult for us at the beginning to ask for sacrifice to everybody and not to ask for the mine. But I think that at the end of the day, what I think that’s really like my experience on the Ministry of Finance, most of the important part of the things, especially like for instance the Chief Economist of the country, Alex Contreras, that he was with me at the beginning of the crisis and he’s still there. So I think that’s what I really think about having the body of public servants that are there. So I think that the knowledge transmits between people. We have a huge crisis. I don’t know if you remember about the Vacuna-gate. And they think that lots of people changed in the Ministry of Health. But I think that I have come to the conclusion that having public servants with lots of technical experience that are able to learn from the experience and using it in different situations, I think that having a body of public servants is really important, that are always in government. And the second, it’s very interesting what happened with Jaime. I think that what have happened in the education system is that because of this lack of supervision. We have private universities that are really, really a huge business, and I can say that in some cases there are suspects that they are laundry machines, like there’s money from narco-traffickers. So every time Jaime… so usually these corrupted groups usually fund politicians, usually fund campaigns. So I think that even though this idea of being transparent with how you fund political campaigns, it is really relevant because I think that’s what happened with Jaime is that because he wanted to really improve learning outcomes in university and do a reform, he was blocked. He was, in fact, impeached by Congress because he was touching too many interests as we say. So what is interesting, I was part of Jaime’s team and then I was when the next minister was there. So the first during Jaime’s term, he had to he was defeated by Keiko Fujimori right. The political party that was led by Keiko Fujimori. And he was impeached by that. But then the next minister that came, he had to face these massive protests were Pedro Castillo was the leader. So you can see how Pedro Castillo was the leader because there was this massive protest. They didn’t want this performance evaluation within the system. So I think that what we really need is some pressure from the citizens and for me the best example of this is what happened with intensive care beds in the country. Like you have during years you don’t have capacity. When the crisis has started, you had 100 intensive care beds and then after six months, you had more than 1,000 like you did in five or six months what the country was not able to do in decades because population was pressuring. So I really think that we have to make citizens pressure more for improving the learning outcomes in education that I am. Especially… Personally, I have some doubts whether or not the potential for new president of the country will really support the reform and this career of teachers and performance evaluations. So I really think that for me, what happened with intensive care beds is an example that if citizens put something on the agenda, the government moves towards that. [01:00:57][375.5]

Patricio Goldstein: [01:01:00] Thank you very much, Toni. I think that’s it in terms of questions, so I think I would just want to reiterate that we’re very, very grateful to have had you. This has been amazing that we’ve had about a 100 people at the peak listening from all over the world, Kennedy School, Peru and pretty much everywhere else. And we learned a lot. And we hope to have, you know, sometime again. Thank you very much. [01:01:28][27.3]

Maria Antonieta Alva: [01:01:29] Thank you. [01:01:29][0.1]

Patricio Goldstein: [01:01:29] And thank you, everyone, for listening today. Again, as we said, you can stay up to date with our research and events by following us on social media and online. Thank you. [01:01:29][0.0]