Without reforms the growth will be stifled

Of the Millennium development objectives, among others, to reduce poverty and infant mortality, as well as to ensure universal primary school enrolment. The Global Monitoring Report, prepared jointly by the World Bank and the international monetary fund, shall annually review the policies implemented to achieve these objectives. Edition 2006 (1) records the significant progress achieved on several fronts. But it also points out that they are incomplete, too slow and, above all, too disparate. Number of countries at risk of not achieving the goals, in many cases lack of means, but also without a good "governance."

Our understanding of the essential role of institutions in economic development has progressed considerably. It has become common to refer to it as the "governance." In short, good governance means transparent and accountable institutions enabling Governments to effectively meet the demands of the population. An independent judiciary, a free press and an active civil society are key elements. They constitute a counterweight to the power of Governments and the elites, who often control them and empower them for public services, job creation and improvement of the standard of living.

Of course, there are countries experiencing an economic boom that none of these conditions is satisfied, or only some of them. But it is unlikely that this growth is sustainable. Sooner or later, these countries will find themselves faced with recurrent economic crises that will gradually slow down their growth until failing institutions are reformed. Evidenced by the example of countries like South Africa, at the time of apartheid, the Indonesia of Suharto or Ivory Coast over the past two or three decades.

Corruption is often the most obvious symptom of poor governance. There again, it is true that growth and corruption can coexist, especially when growth is rapid, and therefore inexpensive corruption for the economy. Eventually, however, corruption will gradually erode the effectiveness of public decision, and the business climate will eventually wither, the pension of the elites increase at the expense of the profitability of the private sector. Without reforms, the growth will be stifled.

The best way to fight corruption is to confront the causes that breed in the most fragile areas of the system of governance. It may be the result of the weakness of the political system leading to the grabbing of the functions of the State by elites without qualms. It can also come from a lack of transparency of decisions, deficiencies of the system of control of the public sector, or an absence of professional standards in public administration.

Beyond the simple monitoring of the Millennium development goals, the Global Monitoring Report provides an analytical framework to account for the multiple dimensions of governance and integrate them into development strategies. It identifies, in particular, the specific and operational indicators that can facilitate monitoring. Particularly important in this regard are the indicators related to the quality of the management of public finance, procurement, audit and financial control systems, and practices of the functioning of the judiciary. The report recommends the systematic use in the evaluation of the development.

World Bank projects contribute to the improvement of governance. Their main purpose is to help the countries to increase the transparency and effectiveness of their budgetary and administrative procedures, strengthen justice or decentralize the decision on social infrastructure and develop civil society. Closer cooperation with the audit services and other institutions of evaluation should also help reduce corruption and increase the effectiveness of development projects.

Governance and corruption resulting bad are global issues affecting both developed and developing countries than in developing countries. The World Bank cooperates with them to prevent misappropriation of funds. The Global Monitoring Report denounces the fact that 20 billion dollars embezzled by dictators Mobutu, Abacha and Marcos accounts abroad. Only 1.5 billion could be recovered. This is unacceptable, as are the payments of bribes by some large companies operating in developing countries.

Some mechanisms can help the international community to strengthen governance in the world and thus facilitate the achievement of the Millennium development goals. Thus the agreement of Cotonou agreement in 2000 between the European Union and 77 countries APC (African-Pacific-Caribbean) committed countries to improve governance and to drive common action in the event of serious corruption. Similarly, the conventions of the OECD and the UN against corruption, the extractive industries transparency initiative and the rough diamonds of said Kimberley Process certification system must be strengthened and applied more rigorously.

These practices and these initiatives will help to put in order our institutions at local, national and global levels placing them under the spotlight. They should also strengthen the application of the public for better governance, application to which the Governments can avoid long.