Poverty Amidst Riches

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    Poverty amidst Riches:

    The Need for Change

    United Nations New York, 2000

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    P O V E R T Y A M I D S T R I C H E S : T H E N E E D F O R C H A N G E

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    FOREWORD

    At its second session held from 3 to 7 April 2000, theCommittee for Development Policy, as requested by the

    Economic and Social Council in its resolution 1999/67 of

    16 December 1999, focused on three issues: the role of

    information technology in development; an international

    development strategy for 2001-2010; and the triennial review of

    the list of least developed countries, based on the revised criteria

    proposed by the Committee in 1999 for this purpose. Members

    of the Committee agreed on a number of recommendations

    intended to contribute to the discussion in the Council on these

    issues and to allow the Council to decide on a revision of the list

    of least developed countries.

    The recent wave of technological change, particularly in

    information technology, has opened new possibilities for

    economic growth and for improvements in the quality of life inall regions of the world. To share the benefits of technological

    development more justly is one of the major tasks for the

    beginning of the new century. The Committee focused on the

    needs of developing countries and on national and international

    policies for reducing the inequalities in the distribution of

    knowledge, information and information technology.

    There has been some progress in accelerating economicgrowth and human development in recent decades, but there also

    have been serious setbacks with devastating consequences for

    poor countries. The targets of the international development

    strategies have not been met. In considering the possibility of a

    new international development strategy for 2001-2010, the

    Committee recommends that a new strategy should be based on a

    review of the successes and failures of previous development

    strategies. The Committee emphasizes that a revitalized flow of

    development finance from the developed countries, through

    official channels as well as from private institutions, is necessary

    in order to enhance economic performance and improve the

    standard of living in developing countries, especially in the least

    developed countries. Democratic processes of good governance

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    in developing countries, as well as the openness of national

    borders to flows of goods and services from all over the world,

    are also among the critical preconditions for a peaceful and

    prosperous world. More effective integration of the developingcountries into the global trading system is another major

    challenge that has to be met to ensure equitable economic

    development in the coming millennium. Increased access to and

    improvement of education, skills and infrastructure are

    increasingly needed to secure a higher level of development and

    standard of living.

    In its review of the list of least developed countries, theCommittee was particularly conscious of the need to ensure

    credibility of the criteria used for this purpose. The Committee

    therefore made special efforts to review the underlying concepts,

    methodology and data in making its recommendations regarding

    the countries to be included in the list of least developed

    countries.

    It is hoped that the analysis and recommendations of theCommittee contained in the present report will contribute to the

    multilateral discussions of and solutions to the problems

    addressed.

    Nitin Desai

    Under-Secretary-General for

    Economic and Social Affairs

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    PREFACE

    The Committee for Development Policy is a high-leveladvisory body, established by the Economic and Social Council

    in 1966 as the Committee for Development Planning and

    renamed in 1998.a The Committee consists of 24 experts from

    the fields of economic development, social development and

    environmental protection. The members are appointed in their

    personal capacity by the Council upon the nomination of the

    Secretary-General of the United Nations. The current members,

    who were appointed for the term starting on 1 January 1999 and

    expiring on 31 December 2000, are:

    Ms. Mria AUGUSZTINOVICS (Hungary): Institute of

    Economics, Hungarian Academy of Sciences;

    Ms. Maria Julia ALSOGARAY (Argentina);

    Mr. Makhtar DIOUF (Senegal): Researcher, InstitutFondamental dAfrique Noire, Cheikh Anta Diop,

    University of Dakar;

    Mr. Essam EL-HINNAWI (Egypt): Research Professor,

    Natural Resources and Environment, National

    Research Centre, Cairo;

    Mr. Just FAALAND (Norway): Member, The CHR

    Michelsen Institute, Department of Social Science andDevelopment, Bergen (Chairman of the Committee);

    Mr. Eugenio FIGUEROA (Chile): Professor of Economics

    and Director, Center of Environmental and Natural

    Resource Economics (CENRE), School of Economic

    and Administrative Sciences, Universidad de Chile,

    Santiago;

    a See Economic and Social Council resolution 1998/46 of 31 July 1998.

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    Mr. Albert FISHLOW (United States of America):

    Professor, School of Management, Yale University,

    and Senior Economist at Violy, Byorum and Partners,

    New York;

    Mr. GAO Shangquan (China): Chairman, China Society for

    Economic Restructuring, Beijing;

    Mr. Leonid M. GRIGORIEV (Russian Federation): Bureau

    of Economic Analysis Foundation, Moscow;

    Mr. Patrick GUILLAUMONT (France): Director, Centre

    for Study and Research for InternationalDevelopment, Clermont-Ferrand;

    Mr. Ryokichi HIRONO (Japan): Professor of Economics,

    Teikyo University, Tokyo;

    Mr. Taher KANAAN (Jordan): Consultant in Economics

    and Business, Computer and Communications

    Systems, Amman;Ms. Louka T. KATSELI (Greece): Professor of Economics,

    Department of Economics, University of Athens,

    Athens (Vice-Chairman of the Committee);

    Mr. Nguyuru LIPUMBA (United Republic of Tanzania):

    Dar es Salaam;

    Ms. Solita C. MONSOD (Philippines): Professor ofEconomics, University of the Philippines, School of

    Economics, Quezon City (Rapporteur of the

    Committee);

    Mr. P. Jayendra NAYAK (India): Chairman and Managing

    Director, UTI Bank, Mumbai;

    Ms. Mari Elka PANGESTU (Indonesia): Member, Board

    of Directors, Centre for Strategic and InternationalStudies, Jakarta;

    t Britainand Northern Ireland): Fellow of Selwyn College,

    University of Cambridge, Cambridge;

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    Mr. Eul Yong PARK, (Republic of Korea): Professor of

    Economics, Handong University, Kyeongbuk;

    Mr. Bishnodat PERSAUD (Guyana): Professor, University

    of the West Indies and Economic Consultant, London;

    Mr. Akilagpa SAWYERR (Ghana): Director of Research,

    Association of African Universities, Accra-North;

    Mr. Udo Ernst SIMONIS (Germany): Head, International

    Institute for Environment and Society, Science Centre

    Berlin, Berlin;

    Mr. Ruben TANSINI (Uruguay): Director, Department of

    Economics, University of Uruguay, Montevideo;

    Mr. Miguel URRUTIA MONTOYA (Colombia):

    Governor, Banco de la Republica, Santafe de Bogota

    D.C.

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    CONTENTS

    Chapter Page

    I. MAIN FINDINGS AND RECOMMENDATIONS ..................................... 1

    A. The role of information technology

    in development ........................................................... 1

    B. Towards an international development strategy

    for the first decade of the new millennium................. 2

    C. Review of the list of least developed countries .......... 4

    II. THE ROLE OF INFORMATION TECHNOLOGY

    IN DEVELOPMENT......................................................................................6

    A. Introduction ................................................................ 6

    B. Potential benefits and risks ......................................... 6

    C. Production and application of informationtechnology in the developing countries .................... 11

    D. Prospects and policies for development.................... 12

    III. TOWARDS AN INTERNATIONAL DEVELOPMENT STRATEGY

    FOR THE FIRST DECADE OF THE NEW MILLENNIUM.................. 19

    IV. REVIEW OF THE LIST OF LEAST DEVELOPED COUNTRIES.......24

    A. Introduction .............................................................. 24

    B.