PKT message, Re: [gang8] VOW investment

Chris,

That is the whole idea behind VOW - to apply a process and assessment system which will ensure - as well as may be - that "investment" in the Third World is very different from what it has been in most TW countries in the past.

You seem almost to be saying that, because some investment has been unwise and unproductive, we should abandon all investment. That some fails does not alter the fact that you can't succeed in advancing living levels, in any continuing and worthwhile way, without real investment (in well-researched, keenly evaluated, well-managed projects).

As to the barriers to investment, some might remain; some might go. What we don't want is the sort of open slather for American and other developed-country investment which might bring some benefit to the recipient but which is characterised much more by the income, wealth and power it confers on the "donors", especially the TNCs.

You'll never have 100% success in investments, no matter how hard you try to appraise them well, eliminate corruption and be fair to overseas investors as well as locals.

But the VOW process is most likely to get satisfactory results. Of course, too, it brings the recipients into the process of evaluation, of financing, of management. It is a learning process as well as an investment process.

By the way, never forget that VOW is not just for the undernourished and starving or even, more generally, for poor countries.

It is for poor people everywhere and it applies macroeconomic policies to maintain healthy growth and stability in the rich countries as well as the poor.

That is essential. We don't want handouts - except of course for those already starving and who can't wait. We don't want a system that helps the poor but hurts the rich. Desirably we want arrangements from which the rich can see that they derive benefits as well as the poor whose need may be more basic and urgent.

It can be done; but we need to develop a belief that we can and the political will to go for it.

James Cumes

http://VictoryOverWant.org

----- Original Message -----

From: ChrisOfDulwich@xxxxxxx

To: gang8@xxxxxxxxxxxxxxx

Sent: Saturday, June 08, 2002 12:09 PM

Subject: [gang8] VOW investment

.

A propos his VOW initiative, James writes "The key to higher income and accumulated wealth is investment."

To some extent yes, but first: 1. who are the investors? and 2. Who selects the investment projects?

Far too much Third World "investment" resource has been squandered on pointless prestige projects - glamorous palaces or grandiose capital cities, multilane motorways which lead nowhere, unproductive projects whose sole function is to generate backhanders for the politicians who pilot them through.

The real answer is to unlock the barriers to successful investment - tariffs, one-sided proft taxation, insistence on "local management" and the rest.

Show me any country with an open-minded attitude to productive investment from all sources, and I will show you a country which will no longer be part of the Third World in a generation's time.

Chris