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Richard Jolly
Deputy Executive Director (Programmes), UNICEF
The nutritional situation, bad enough in 1980, has significantly deteriorated in subsequent years in very many countries of Africa and Latin America. The World Bank's document Poverty and Hunger [1] has summarized the situation in 1980. In a few cases there is direct evidence of a decline in nutritional status of the population of many developing countries. In many others, the evidence is strong but indirect.
The clearest indicators are substantial and often sustained declines in real per capita income and substantial cutbacks in health and education expenditures. Whether nutritional status is still deteriorating in the mid-1980s is less clear, but, as one indication, the World Development Report of 1985 gave as its optimistic projection for Africa a further decline of about 0.1 per cent per year in Africa's per capita income until 1995 [2]. Its pessimistic projection involved an even more rapid decline. It is not easy to combine that sort of macro-projection with optimism about improving nutrition.
There is now under way a major process of rethinking the basic issues of economic development, adjustment, and debt. At the World Bank/International Monetary Fund (IMF) meetings in Seoul in October 1985, greater emphasis on growth in the adjustment process was introduced as the conventional wisdom, to an extent that contrasts greatly with thinking even three months before.
There are also the stirrings of new thinking on debt, although we are very much further from producing answers commensurate with the magnitude of the debt problem in Africa, let alone Latin America.
As yet, there are few real signs that the nutritional or other human dimensions of adjustment have been recognized with the seriousness they deserve or have received anything like the attention accorded to the need for more growth orientation. We need to ensure that longer-term growth is of a sort structured to ensure benefits to the poor and not just to rely on trickle down. In other words, we need to get back to the direct concerns with poverty and distribution that were becoming the conventional wisdom in the international community at the beginning of the 1970s.
The need for redistribution with growth or basic needs was how the Bank and ILO wrote about these issues at that time. UNICEF, in parallel, was emphasizing community action in the process of meeting basic needs. Thus, ten years ago it was recognized that there should be a double priority for development. The first priority was economic growth, the rate and pattern of which ensured that the poorer sections of society would have the opportunity to meet their basic needs. The second priority, which is especially important today in the context of adjustment, was the need to ensure some maintenance of nutrition and basic-need support of the most vulnerable groups in the short run as well as in the long run.
To this second end, three steps need to be incorporated into the adjustment process, as described in my earlier paper "Adjustment with a Human Face" [3]:
THE OBJECTIVES OF ADJUSTMENT
No one should underestimate the importance of a clear acknowledgment that protection of the poor and vulnerable must be one of the key objectives of the adjustment process. It needs to be generally and widely acknowledged that adjustment is not only an economic or financial process in the narrower sense, but one in which concern for people must be an integral part in the short run as well as the long run. Public acknowledgement of this is vital, for we are talking about issues of perception and changes in conventional thinking as much as about conflicts of interest.
THE COMPONENTS OF ADJUSTMENT POLICY
Concerning adjustment policy, additional instruments are necessary. Professor Tinbergen in his classic work on economic planning [4] showed that for each objective you need an instrument of policy. Per Pinstrup-Andersen's paper in this issue of the Food and Nutrition Bulletin identifies five areas of policy that form part of conventional orthodox adjustment policy: monetary, fiscal, exchange rate, foreign trade, and wage-price policy. If concern for nutrition and basic needs is to be part of the adjustment process, adjustment policy will need a sixth instrument, focused on nutrition and basic needs or on maintaining the incomes and productivity of the poorest.
When I refer to policy components, I do not mean projects. Today there is an extreme tendency to ''over-projectize." Many developing countries are severely set back by too many projects and too little programme support. What is necessary to protect the vulnerable are changes in policy and programmes, including food and agricultural price structure and income and informal sector policy.
Policy must address the need to restructure not only the productive sector but also health, education, and some other basic services. Typical in Africa and most of Latin America today are severe cutbacks in education and health. The realistic challenge is not to hold the line against cutbacks but to focus on the subsectoral level of issues. For instance, within the health sector there is a widespread need to restructure expenditure towards primary health care and away from the big hospitals. Within primary health care, more emphasis is needed on highly effective, lower-cost activities focused on the needs of the majority. In countries where cutbacks are destroying the basic infrastructure of social and health education, resources are needed for the repair, maintenance, and operation of facilities like primary schools, for services including basic health services, and for sanitary and water-supply facilities like water pumps. The returns on money directed towards such needs are very much higher than resources spent on more new projects.
A MONITORING SYSTEM
Monitoring is critical if policy is to be responsive to nutritional needs. Nutrition and other social indicators must be available in a timely and up-to-date fashion and must be succinctly presented. People concerned with adjustment policy have a legitimate complaint: Basic economic data on balance of payments, inflation, and the gross national product (GNP) are usually available within a month or two after the event. In contrast, nutrition and other basic health and social indicators are often based on infrequent and non-comparable samples and are only sporadically available and then usually only a year or two after the data were collected. This situation must be remedied.
Many of the necessary data already exist and in many more countries than we often realize. When UNICEF commissioned a study in 1983 in Brazil of the impact of the recession on children [5], our consultant commented on the quantity of relevant data in Brazil. Indeed, many persons asked him why no one had thought to ask his questions before. In Africa, generally a difficult continent for statistics, data on month-by-month changes in moderate and severe nutritional status exist for some 17 countries. Figure 1 gives examples of the kind of data available. The data are not perfect. In many cases, for instance, data such as those illustrated in the figure come from Catholic Relief Service operations and are, therefore, clearly biased by sampling those who come to collect food. Cornell University has been analysing these data to see what biases are involved and how the biases and quality of the data vary with coverage. My point is not that the data are perfect but that they exist, can be processed and published, and can be improved if we care to make the effort.
GNP data are also far from perfect, relying on estimation much more than most people realize. Similarly, price-inflation data in many developing countries are often based on a sample of price changes in some of the main shops of the capital city and are hardly a reliable indication of national, let alone rural, price changes. Yet it is such economic data that by conventional wisdom have diverted our attention from concern with people. Before we criticize our data on nutrition because they are not accurate to the last decimal point or because they do not represent widespread coverage, remember that it is better to have a broad impression of the human, social, and economic picture than to allow a narrow preoccupation with the GNP to continue. The ACC/SCN could produce and publish better and more up-to-date data on changes in nutritional status and some of the other basic human indicators.
THE PROCESS OF ADJUSTMENT
Fifty years ago, Keynes, in the preface of the General Theory [6], said that he expected people would react to his path-breaking book in two ways some would assert he was saying nothing new; others would say he was talking absolute nonsense. Certainly we have found adjustment with a human face often invokes the same responses. There are many misunderstandings.
Nutrition and Production
Many people somehow cannot keep in mind that we are talking not just about welfare but also about more efficient production. A malnourished labour force cannot be the basis for a robust economy. We need to repeat these obvious points because many people, when thinking about adjustment in the rest of the world, and not about themselves, fail to remember:
It is too readily assumed that there is a trade-off between equity and growth. The relationship between the two was analysed in the World Bank/IDS study Redistribution with Growth [7]. The conclusion of this study was that there is often much less of a trade-off between growth and equity than is commonly perceived and that a great deal depends on the way growth or economic output is measured. Conventional measures of economic growth involve bias by implicitly weighting the income growth of each section of society by the share of total income which that section of society had at the base period. Thus, if the richest 20 per cent of society has 50 per cent of the income and the poorest 20 per cent has 5 per cent of the income, the conventional measure of the average growth of the GNP accords a 50 per cent weight to the growth rate of the richest group and only a 5 per cent weight to those who receive 5 per cent of the income. In contrast, if the growth of each income group were weighted equally (what one might call a one-person, one-vote weighting system), the result would be different. Using the latter approach, policy actions that increase the incomes of the poorest would receive a higher weighting in growth measures than they conventionally do, and the trade-off between growth and equity would be correspondingly reduced.
The Political Dimensions of Adjustment
Within our own agencies and outside, we need to build alliances with individuals who genuinely seek action on issues of nutrition and human concern. The ACC/SCN has a clear role in this, not as a select club, but as a committed group of allies. There is real potential for action if the allies for action can be mobilized to take action.
Also, of course, some countries are more committed than others. There are governments that are really struggling to protect the nutritional situation of their populations: we should be encouraging and supporting these countries, affirming that their commitments make sound economic sense. There will be other governments where that is not so. But at least we should not miss the positive opportunities where they exist. I would also like to suggest that too much emphasis on conflicts of interest is mistaken. "The power of vested interests is vastly exaggerated,'' Keynes also said, "compared to the gradual encroachment of ideas" [6]. It is ideas - the conventional ways of thinking about adjustment - which often hold us back and lead adjustment policy to ignore the human dimension. Our job is to show in a creative way how human and nutritional concerns can be included within the total package of adjustment.
International Debt Crisis
I must stress that, until now, we have been talking only about a shift of perspectives of adjustment, within a tightly constrained framework. The severity of the adjustment process that the world has gone through, and I fear will still go through, is closely related to the lack of more fundamental international adjustment affecting world demand, commodity prices, aid, debt, and interest values. The debt problems are horrific. I doubt whether many of us realize the actual magnitude of the indebtedness problem. Let me just give you some figures for Africa. World Bank and recent IMP figures show that in the period 1980-1982 the net inflow of loans, aid to Africa, and capital transfers was about US$10 billion, after allowing for some outflows. In 1985 there was an inflow of US$3 billion through the UN Emergency Office for Africa, percent US$300 million to US$500 million of which was donated privately. In spite of that, in 1985 there was an outflow of interest and debt repayment of about US$12 million, about four times as much. What was left as the total net inflow over 1985 was estimated by the IMF recently as US$1.2 billion, one-tenth of what it was from 1980 through 1982, with subsequent declines also in export earnings and other indicators. In 1986 the figures seem likely to show a net outflow in total.
THE ROLE OF NUTRITION ADVOCATES IN ADJUSTMENT POLICY
Professionals in nutrition should never underestimate the extent to which officials in the ministries of finance and the central banks may not even perceive what is happening in nutrition nor be aware of the possibilities of low-cost remedial and preventive action. Similarly, the needs of women or the need to raise productivity of small-scale farmers may be understood in the ministries of agriculture but not by those making critical decisions in adjustment policy. We need to get these needs across in small-scale ways and in public advocacy.
Advances in immunization and oral rehydration over the last few years provide good examples. WHO and UNICEF have advocated primary health care since 1978, including the goal of universal immunization. Following the public advocacy of the last two or three years, we have seen a threefold increase in vaccine use in the last two years, at a time when most economic indicators have gone down. We have a 2 1/2-fold increase in ORS use. The impact of these two measures alone is estimated as more than a million fewer children under five dying in 1985. People do not realize what can be done at low cost unless we find ways of getting these points across.
We need to give a sense of hope and a sense of specific country action. For instance, let us look at the human dimension of adjustment in Korea. In 1981 Korea embarked on an adjustment programme to cope with the sharp rise in oil imports and a 6 per cent fall in its GNP. As part of the programme, it included a panoply of measures relating particularly to children. Botswana is another good example. Since 1981 it has had to cope with a sharp decline in diamond prices, an adjustment programme, and four subsequent years of drought. There was already a nutritional monitoring scheme based on growth monitoring of children every month and covering about 80 per cent of the children in the country. The growth-monitoring programme was used for a series of nutritionally focused support measures, primarily to provide supplementary food for the malnourished children coming to the clinics. If something like 40 per cent of the children in any village were found to be moderately or severely malnourished, certain village-focused programmes came into operation. The regular school meal was stepped up from one to two or three meals a day, with supplementary meals provided on Saturdays and Sundays. In addition there were programmes for unemployed able-bodied males, for the destitute, and for people in geographically remote areas.
THE ROLES OF INTERNATIONAL AGENCIES
A public statement by the Managing Director of the IMF would be an important step for legitimizing the human concerns in adjustment. Clearly, the World Bank in its new roles with the IMF in relation to Africa has a major part to play in ensuring that structural adjustment loans take full account of human needs. It is not only a question of the people at the top formally agreeing, but of ensuring that a broader approach to adjustment is carried into policy and action at all levels. Careful analysis, serious planning, and a clear allocation of responsibilities for action and supervision are all required.
None of these measures will be easy, as many staff people start with different perceptions, judge the situation by different indicators, are schooled in orthodox ways of approaching adjustment problems, and have real uncertainty about how innovation will be judged relative to conventional performance. In other words, a major issue is how to ensure leadership and responsibility within the different agencies that carry policy statements through to action, so that the content of adjustment programmes and structural adjustment loans really takes into account nutritional and social issues. Certainly all the points in the Bank's document Poverty and Hunger [1] are relevant to these concerns.
There is, I believe, a particular role for the UN cluster of agencies, separate from the Bank and the Fund. The issue of human resources is the common element that virtually all the specialized agencies of the UN and the agencies of the UN system share: the World Health Organization in the area of health; the Food and Agriculture Organization in food and nutrition (I wish nutrition were emphasized a little more strongly); the International Labour Organisation in employment and particularly the concerns with the poor and basic needs; and the United Nations Economic, Social, and Cultural Organization in basic education. The human dimension is also central for the UN agencies with operational programmes: the United Development Programme, the World Food Programme, the United Nations Fund for Population Activities, the United Nations Children's Emergency Fund, and, I would always add, the International Fund for Agricultural Development.
What we have learned about collaboration is that it always works better if an agency sees its own interests to be clearly involved in the collaboration. A focus on the human dimension could provide the basis for building on a core of common interest. The UN could thus take a lead in supporting the human dimensions of the adjustment process.
Often there is talk among UN agencies of concern for human resources in the general development context. Yet we are not in a general development situation. We need to be more specific in relating these human concerns to the context of constraint and often decline.
A number of donors have already expressed specific and public interest in these broader approaches to adjustment and in the way poverty is sues have been neglected in the last few years. Donors prepared to take the lead are particularly important for providing modest, but specific, financial support for new initiatives in exploring alternatives.
CONCLUSION
In summary, there are five things I hope we will do as the ACC/SCN.
First, to draw attention to the serious nutrition and poverty situation, including the fact that in many parts of Africa and Latin America it appears to have worsened since 1980. We need to make this an important part of advocacy through the heads of our agencies speaking out publicly on the nutrition issue.
Second, to recommend in the clearest terms that the basic objectives of adjustment policy should be broadened; to make explicit the need to protect nutrition and other basic needs of the vulnerable in the course of the adjustment process in the short term; and to improve the food and nutritional status in the longer term.
Third, to encourage all UN agencies, including the Bank and the Fund, to explore and support a range of activities to protect the vulnerable in the course of adjustment and to avoid measures that are likely to worsen the position of the poor and vulnerable.
Fourth, to encourage all UN agencies to support, individually and collaboratively, the improved collection, analysis, and rapid publication of data on the changes in nutritional status and other basic human indicators. I hope we can also support empirical research and analysis to strengthen our understanding of these issues.
And finally, as a means to the above, I hope we can agree on special efforts at the country level by interested UN agencies and donor countries working together in support of measures to implement a broader approach to adjustment policy.
REFERENCES
1. World Bank, Poverty and Hunger Issues and Options for Food Security in Developing Countries (World Bank, Washington, D.C., 1986).
2. World Bank, World Development Report (Oxford University Press, Oxford, 1985).
3. R. Jolly "Adjustment with a Human Face," Development: Seeds of Change (journal of the Society for International Development), Fall 1985, pp. 83-87.
4. J. Tinbergen, Economic Policy: Principles and Design (North Holland Publishing Co., Amsterdam, 1956).
5. R. Macedo, "Brazilian Children and the Economic Crisis: Evidence from the State of Sao Paula," in R. Jolly and A. Cornia, eds., Impact of World Recession on Children (UNICEF, New York, 1984).
6. J. M. Keynes, The General Theory of Employment, Interest and Money (Macmillan, London, 1936).
7. H. B. Chenery, M. S. Ahluwalia, J. H. Duloy, and R. Jolly, Redistribution with Growth (World Bank, Washington, D.C., 1974).
