by Winston Dookeran
The following was presented as the keynote address at the Fulbright 2000 Program awards ceremony in Trinidad and Tobago on March 14, 2001.
NEW BEGINNINGS
 As many of the frameworks that defined our space give way, we are witnessing a series of new beginnings on many fronts—all at the same time—that present tantalising yet intimidating prospects for change. Some of these beginnings have their genesis in technology and communication. Some have emerged from the globalised financial markets that are at our doorstep. Other new beginnings are appearing out of the new integration models that are part of the current process, while others may result from the new commitment to democracy and free trade all over the globe.
Let me now identify a few of these new beginnings.
One is the new connectivity. In today’s world, what takes place in Thailand affects us in Trinidad and Tobago—as we saw during East Asia’s recent financial turmoil. The traditional North–South relationships are also being altered as economic conditions in the South now affect conditions in the North. Previously the relationship only flowed in the other direction—we are now going “up” what was once a “down-only” street. This new connectivity is fuelled by technological innovations that constitute the platform upon which the future is being shaped.
A second beginning could be called convergence. The tone of U.S.–Latin American–Caribbean relations in today’s world is no longer being shaped by co-operation alone, but by the convergence of integrative processes. Convergence of economic ratios—import cover, exchange rate stability, debt–GDP ratios—are essential ingredients in integration movements. Countries’ policies, too, converge as they are measured by the same yardstick, first the Washington Consensus and now the second generation of reforms, and as national interests become inextricably bound up with global concerns.
The emergence of a tangible civil society voice on the world stage presents a third new beginning. The Internet has enabled people to interact in terms of ideas and ideals and gives a global voice to causes that transcend national borders. Concepts of human rights and political liberties are now part of the prevailing rhetoric and “emobilisation” gathers people together from across the globe to exert influence, often on behalf of the voiceless, within the World Trade Organisation, the International Monetary Fund, the World Bank, and other powerful international organisations.
NEW DIVIDES
And yet these new beginnings have also opened up new divides.
A new gap has emerged amongst developing countries as some have moved ahead, leaving the poorest to grapple with the basic strategies of survival. Jeffrey Sachs, writing recently in The Economist, stated that technology is creating a new and intractable division amongst countries. A small part of the globe, accounting for some 15% of the earth’s population, provides nearly all of the world’s technology innovations. A second part, involving perhaps half of the world’s population, is able to adopt these technologies in production and consumption. The remaining part, covering around a third of the world’s population, is technologically disconnected, neither innovating at home nor adopting foreign technologies. Many of these technologically excluded regions, which do not always conform to national borders, are caught in a poverty trap. Among their greatest problems are tropical infectious disease, low agricultural productivity, and environmental degradation—all requiring technological solutions beyond their means.
While previously natural resources were a determining factor in a country’s production, today, with the advent of new products that utilise intellectual property and knowledge-based inputs, the template is changing. This intangible factor of production, knowledge, is becoming increasingly relevant as a foundation stone in adding economic value. In this sense, a new divide has emerged between resource-based products and knowledge-based products.
At the same time, old divides are taking on new forms. The recent escalation in the number of refugee crises is but a new manifestation of the old story of war and poverty. The inequality of wealth distribution is increasing amongst countries. In a recent U.N. publication entitled Imagining Tomorrow: Rethinking the Global Challenge, the figures point to a startling increase in the income ratio between the fifth of the world’s peoples in the richest countries and the fifth of the poorest, from 30:1 in 1960 to reach 74:1 in 1997. Distributive problems are also growing within countries. A serious challenge facing the world economy in the years ahead will be to ensure that international economic integration does not contribute to social disintegration.
The new beginnings and the new divides, some of which I have just alluded to, demand of us a re-examination of our tools of analysis.
OLD AND NEW ORTHODOXIES
The first generation of thinking on development strategy and growth focused strongly on the issues of natural resources, on state intervention and controlling the commanding heights of the economy, and on building institutions that serve the public good. Gaps emerged, deficiencies appeared which necessitated a new paradigm. The deepening of the reform process led to an emphasis on the market-based economy, trade liberalisation, and the freeing up of capital flows.
Yet, in some sense, this whole first generation reform programme has not borne the expected fruits, and the search has begun for the new drivers of economic growth compatible with the evolving global context. Some have argued that technical change still remains the driving force, as it is the basis for productivity improvements. Others have advocated export-led growth as a sure path to progress. The building of competitiveness of economies was another major platform for exploiting the opportunities that unfold in the changing global landscape.
There are elements of truth to each explanation. But let me focus on the notion that people must now be regarded as the principal vehicles of development. Traditionally we have seen people as the object of development; we must now see them as the means to achieving that same goal.
Perhaps this is a return to the equity and development thinking of the 1960s which permeated the strategy for change in the Far Eastern countries. Or it may be seen as the subordination of the economic system to broader social objectives. Amartya Sen even referred to the concept of development as freedom, developing the “basic idea that enhancement of human freedom is both the main object and the primary means of development...the objective of development relates to the actual freedoms enjoyed by the people”.
A programme where people can be the driving force of development requires a social and institutional infrastructure. A key element of this infrastructure will be its capacity for networking. At the level of policy, an integrated framework must be designed; at the level of people, new interactions across borders must be fostered; and at the level of strategy, alliances and partnerships that add value must come to the fore. The networking challenge goes beyond mere statements made at summit meetings. It requires people and enterprises to find the appropriate methodology for networking that would allow them to widen their economic space.
An important element in making people the drivers of development is highlighted in the “new growth models” that focus on the essential connection between education and economic performance. There is no doubt that an economy’s productivity is linked to the level of training of its workforce. But what we must strive for today is entry into a “virtuous cycle of achievement”. Here economic growth gives us the ability to provide more resources to education, and then a more educated workforce enhances greater economic growth. The creation of knowledge has become the basis for the new prosperity.
This new prosperity to which we all aspire could sometimes be the result not of good management but rather of good fortune. Rising prices of world-traded commodities, like oil, are good fortune to some but a bad omen to others. But good fortune may also be the result of a carefully prepared conjuncture of time and events. However, intervening in the link between time and events calls for an understanding of the process of negotiations, a “new diplomacy”.
A NEW DIPLOMACY
The Caribbean, perhaps positioned between a rock and a hard place, is redefining its place in the world. Frontiers are being challenged. New economic borders are emerging. Political options are widening and the international agenda is being reshaped. The call is for a new diplomacy and different terms in a changed global economy.
The implications of this new diplomacy will require us to face the challenge that countries like ours must compete with other countries for the skills of our own people; must develop alliances and joint ventures not only to facilitate marketing but more so to integrate technologies into our productive processes. This too is the search for a competitive edge which, once achieved, could lead to a flow of innovations converted into commercial products.
Development in the Caribbean now demands a comprehensive political economy of change, including the development of endogenous growth capacity to drive the economy. Only then can the region benefit from the new and flexible world economy, in which ends and means are readily adjusted to changing opportunities in different countries. This will require a regional integration model that transcends trade, strives for convergence of our private and public institutions, and facilitates backward and forward, macro- and microeconomic linkages. Eventually the creation of a network of productive interconnectivities would expand the region’s political space and increase its negotiating strength in the international arena. Merging into a greater political-economic whole would help to free individual states from rent-seeking power bases, bring about greater economic efficiencies, and allow governments to concentrate on governance.
Enlightened governance is needed to enforce regulations, formulate and implement policy, build international linkages, forge collective public and private sector initiatives, and promote human resource development that will bring the disadvantaged into the development process. The world that we now inhabit will likely call for constant economic adjustment; but, if the foundations of social life are not to be further eroded, this process must be countered with a “high-energy politics” capable of repeated basic reform, involving intensified public participation and democracy.
Here in Trinidad and Tobago, the economic winds are currently in our favour, but the direction of those winds always changes. While they are still blowing to our benefit, much hard work is required to consolidate and expand upon our recent economic achievements. On recent experience, we saw our growth rate for the last year fall to four percent, still comparatively high but below our expectations. My message here is that the growth dynamics of our economy must now be linked to a well-thought-out people-driven approach to development. “Focusing on people” is no longer just a good thing to say; circumstances now demand a science to understand how it can work.
In conclusion, permit me to thank the United States Ambassador, His Excellency Edward E. Shumaker III, for placing us well on our way to establishing this new diplomacy. The Fulbright 2000 Programme, by providing our country’s best and brightest students with the opportunity to study at the most prestigious universities in the United States, is ensuring an essential future source of enlightened leadership.
He has also provided us with an example of the networking I spoke of earlier that is a key part of the new diplomacy. Under his guidance, the Programme has become a model of public and private sector co-operation that has already produced tangible results. Since 1998, His Excellency has worked tirelessly to not only make Trinidad and Tobago’s Fulbright Programme the only one to combine both undergraduate and graduate studies, but also the largest privately funded programme of its kind in the world.
Winston C. Dookeran, governor of the Central Bank of Trinidad and Tobago, is a former fellow at the Weatherhead Center for International Affairs at Harvard University. Previously, Dookeran was a senior economist at the United Nations Economic Commission for Latin America and the Caribbean. He also was a member of the Executive Board of the Inter-American Development Bank and the governor of the Caribbean Development Bank. From 1986 to 1991, Dookeran served as the minister of planning of Trinidad and Tobago and on several occasions served as prime minister. In 1991, the University of Manitoba awarded him an honorary doctorate in recognition of distinguished public service.
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