Growth or development [Archives:2008/1150/Viewpoint]

April 28 2008

Two terms often confused with each other and wrongly used interchangeably are growth and development. Development includes growth while maintaining social justice and fair distribution over various sectors in a sustainable way.

Therefore, growth is only one of the requirements of development. In the same time growth does not necessarily translate into development, in fact, sometimes it leads to the opposite. For example, growth in population does not necessarily indicate development, in fact for a country like Yemen, increasing population is an obstacle against development. Similarly the growth in the Qat industry is certainly a national disaster and definitely not development.

Mixing between these two concepts skews national plans and creates a setback in the country's progress. Because adopting an investment in a certain sector because it creates financial growth regardless of its impact on other sectors will eventually lead to long term difficulties despite the short-term euphoria. An example of this is oil exploration and its impact on water; For every one-barrel of oil, exploration companies have to extract 10 barrels of underground water. This means that for more oil based income, we are jeopardising an important resource that we need for future sustainability. Politicians who argue that this water is inserted back are even more at fault because this water has already been polluted especially in the absence of state supervision and environmental conscious systems.

Consequently trade-off policies, which victimize some groups of the society during the launch of some projects, have catastrophic results. Some decision makers who think that if they prioritise a sector to generate income quickly over development in other fields in the hope that when there is enough money the growing sector will automatically pick up the others, could not be more wrong. To start with, development does not happen automatically. And then secondly, if you encourage vertical growth the deterioration in the overall scene will cause new challenges to immerge. For example, if we put all our resources into creating a free zone in Aden and ignore the fact that the city needs improvement in the social, education, health, and human resources sectors then only the rich businessmen will benefit while the poor citizens will be even pushed further into the suburbs because of the increase in property prices. A free zone will not create more jobs, while the living conditions will deteriorate because no one took care of education and employment.

Another example is when a country depends on debts to enhance development. Global policies in the eighties realized this when a time came when Africa was financing the United States economy by paying interests in loans.

The point here is that we need to be careful how we think about development and how our development plans are made. It is not enough that a strategy brings out growth. It is more important that it is the kind of growth the country needs across sectors and in a sustainable way. So the message to our planning gurus, that before you sign off another strategy that you think will increase national income think twice, for certain damages can never be undone.