(10 February 2010, Port Vila, Vanuatu)
Acknowledgements
Thank you for the invitation to speak at this meeting.
Economic crises are not new – they come and go. It’s how we respond, the policy choices we make and that we become more resilient with each new experience that matter.
Today I want to touch on a few themes that relate to the human face of the economic crisis.
I want to talk about the important issue of labour mobility and skill flow in the context of the development of people and economies.
I want to look at the economic progress that has been made in the Pacific.
And I will also touch on how small states can work more closely together to influence ways in which the international community approaches poverty reduction.
As this conference acknowledges, the past year or so has been tough on the Pacific – first with the high oil prices of 2008, then the global recession, followed by the tsunami in Samoa and Tonga.
These have combined to slow economic growth and progress towards the MDGs.
I congratulate Pacific island countries for resisting the temptation to pull back from integration with the global economy.
That would have been the worst thing countries could have done in responding to the crisis.
Countries that have done this have historically not fared well
It’s important that we take a long term view of what has happened.
Looking at the bigger picture, there have been some significant achievements over the past ten years.
Ten years ago hardly anyone in the Pacific had a mobile phone or internet access.
Now, mobile phones are widespread.
Here in Vanuatu over the past two years the proportion of the population with mobile phone access in Vanuatu increased from about one-quarter to three-quarters.
Another achievement has been a big decrease in the incidence of malaria in Vanuatu and Solomon Islands.
And reforms are making it easier to do business in several countries in the region.
These improvements not only contribute to greater economic development in general, they give people greater freedom to make choices and take advantage of opportunities that improve their lives.
They are necessary but not sufficient.
We need to take into account broader questions of history and geography.
Despite all the development assistance over recent decades, there can be no doubt that where we are born is the main thing that will determine our material well-being.
We can work and try as hard as we like but for most of us, where we live will have the greatest bearing on our individual economic prospects.
This is not an advocacy of despair or futility.
It is merely an insight into some further steps we need to consider to build resilience in the face of inevitable future economic challenges.
Because it is people who develop, not places.
Individuals develop when they receive an education and health services. We all develop when we have an income. And we develop when we have the freedom to use our skills and knowledge where opportunities present themselves.
More than ever, this century will be one of enormous movement of people and of skill flow.
We will be able to work in new and quite different ways.
Some of us may choose to live and work in another country permanently. Or we might find ourselves living in one country but working in another for set periods, or even working remotely.
People from the Pacific taking part in seasonal worker schemes have the advantage of working in Australia and New Zealand part of the year and being in their own country the remainder of the time.
This is exciting – we are lucky to be living in an age where transport and communications give us such flexibility.
To some extent these new ways of working should stop accusations of ‘brain drain’.
The term ‘brain drain’ has negative connotations and should be dropped.
It is far too simplistic to say that if an educated and skilled person leaves a country, the country is in some way dragged down by that loss.
The philosophical and economic arguments relating to the term ‘brain drain’ are complex and this is not the time or place to go into them in any depth.
However there are a few points that can be made.
The first is that many skilled people serve in their own countries for years before they emigrate.
The second is that if we limit or eliminate the chance for migration, we might also see a reduced investment and interest in education.
People’s education decisions are often shaped by opportunities for migration, even if not everyone ends up taking up that opportunity.
The Philippines is a good example. It has one of the world’s highest tertiary enrolment rates.
One reason is that a lot of people study nursing because nursing is a profession where they can get jobs in wealthier countries.
As it happens many nurses in the Philippines don’t end up emigrating - it’s the idea that they can that seems to motivate them to do tertiary education.
A third benefit is that when skilled people emigrate from one country to another there is more trade between the two countries.
And when skilled emigrants from poor countries go back home, they take back with them skills, savings and raised expectations along with an awareness of better functioning systems of government and service delivery.
Here in the Pacific we are all too well aware of the benefits which flow to countries of origin through remittances from temporary and permanent migrants.
Of course, migration is not the be all and end all to advancing development.
But greater mobility for workers across borders has the potential to massively increase people’s living standards.
Traditional thinking about poverty reduction does not generally link immigration with development policy.
It has tended to focus on aid, trade and removing international barriers on things that raise the productivity and living standards of people in lower income countries.
But there is a case for more debate about the role of immigration as a development too – Australia is already taking small steps with the pilot seasonal workers program and by helping young people in the Pacific gain skills that might lead to jobs in other countries.
Young students from Kiribati are studying nursing in Australia. By next year about three thousand people will have trained at the Australia Pacific Technical College in areas where they are likely to find jobs in their own countries or abroad.
This increased emphasis on skills ties in nicely with the Pacer Plus trade agreement – an important part of the Plus is building up the capacity of the workforce to take advantage of the new trade arrangements.
And it complements efforts to increase business in the agricultural sector.
On this note, it is my pleasure to announce today a new program funded by the Australian Government to improve marketing opportunities for small farm holders here in Vanuatu and in several other Pacific countries.
The $10 million program will give farmers extra help to improve and expand their products, their supply chains and their marketing.
It will make it easier for them to get their products to markets and become more competitive in the region.
This program will be carried out by several research institutions and agencies in the Pacific and Australia and will be led by the Australian Centre for International Agricultural Research.
Improving food security and improving the livelihoods of people living in rural areas in the Pacific will help countries make greater progress towards the Millennium Development Goals.
I said at the outset I wanted to mention the Millennium Development Goals because these effectively represent the human face of development.
This year is a critical one for the UN and for the countries committed to the achievement of the MDGs because it’s an opportunity to leverage the change needed to reach the targets by 2015.
The MDG Leaders summit to be held in September will give us all a chance to take stock of progress and the challenges ahead.
It is an opportunity to ask whether the MDGs have been the right targets and goals and what will happen after 2015.
Most importantly, we will want to stop backsliding where it is occurring and accelerate progress where it is needed.
Australia will contribute our ideas, those we have learned from our experience as a bilateral donor and ideas that emerge from interested Australian groups and individuals.
However it’s critical that the views of developing countries be heard at the Summit.
This can be hard for some states, particularly the smaller states, but the world needs to hear from you.
Through the Pacific Islands Forum or Association of Small Island States, or both, you can present a common and independent position on the MDGs which will say something the rest of the world needs to hear.
You all know that small island states have some issues which differentiate their position from that of other developing countries.
It is a top priority for Australian in the lead up to the Summit to make sure your important viewpoint gets a fair hearing.
We will all be asking questions of the MDGs in coming years.
We will want to know the ways in which a common international agreement on aid and development has been useful, whether the structure of the MDGs should be replicated in the future or whether the context of the MDG framework has served the interests of developed and developing countries effectively.
There is a lot to discuss.
I want to finish on the note on which I began – throughout the global recession we have all sought to minimise the impact on individuals.
Social protection can do so much but improving access to reliable and quality services and increasing access to economic opportunity will do a lot more.
More than ever, donor assistance needs to be as effective as it can be – the Cairns Compact on strengthened donor coordination will help us achieve this.
I understand substantial progress has been made towards implementing the Compact since it was agreed by Leaders last year and that work is on track for key reviews and reports to be completed ahead of this year’s Forum here in Port Vila.
This is encouraging.
Although I will be retiring from politics this year, my interest in international development remains as strong as ever.
My intention is to do more work in this field, not less, and I relish that thought.
I have been interested in aid and development all my adult life and nothing will change that.
Thank you.
Other Speeches and Statements
Lead Presentation by Dr. Noeleen Heyzer: Impact of the Globa - 12 February 2010
Speech by Hon. Edward Natapei, Prime Minister of Vanuatu - 10 February 2010
Keynote Address by Miss Helen Clark - 10 February 2010
Statement by the Minister of Finance and Economic Management - 23 November 2009