UNITED NATIONS — “The rise of the South is unprecedented in its speed and scale…when dozens of countries and billions of people move up the development ladder as they are doing today, it has a direct impact on wealth creation and broader human progress,” cites the glowing introduction to the UN Development Program’s (UNDP) annual Human Development Report.
Indeed the South comprises many of the developing countries, places which used to call themselves the Third World, but are now known as the Global South.
The 2013 Human Development Report views development with a broad brush which goes beyond traditional GDP statistics and adds issues of equality or inequality in gender, education, poverty etc.
Standings in the Human Development Index (HDI) which for nearly twenty years charted the socio/economic ebbs and flows of social development standings still has its rankings; the top five countries are Norway as number one, followed by Australia, the United States, Netherlands, and Germany.
Other countries such as Japan, Canada and European Union states are in the top tier. So too is South Korea ranking as number 12 and Hong Kong as number 13 out of the 186 states surveyed. The Republic of China on Taiwan which would certainly rank high is not listed due to Beijing’s bullying.
But what the Survey calls the “Rise of the South” looks at rapid advances in places such as Brazil, China, India, Indonesia, Mexico, South Africa and Turkey. It equally views smaller countries such as Chile and Ghana.
The report asserts “For the first time in 150 years, the combined output of the developing world’s three leading economies, Brazil, China and India, is about equal to the combined GDP of the longstanding industrial powers of the North; Canada, France, Germany, Italy, United Kingdom and the United States. This represents a dramatic re-balancing of global economic power.”
Perhaps so, but let me stress that this fact does not begin to say that the quality of life, the standard of living, or the political rights and freedoms remotely compare. The statement cites raw economic progress. What it does presage is a positive growth of middle classes in the South, which will have a positive effect for people both in the regions and globally.
There are many lessons here. “In 1950, Brazil, China and India together represented only 10 percent of the world economy, while the six traditional economic leaders of the North accounted for more than half. According to projections of the Report by 2050, Brazil, China and India will together account for 40% of global output far surpassing the combined production of today’s Group of Seven Bloc.”
Impressive if the trends continue, but let’s have some context. Take India for example. At the end of the British Raj in 1947, independent but partitioned (remember Pakistan broke away) followed the primrose path of democratic socialism. Nehru’s rule sought to make India an industrial power at the expense of agriculture. The planned economies and self-sufficiency were many of the self-inflicted wounds of Nehru’s tenure and later that of his daughter Indira Ghandi.
The anemic “Hindu rate of growth” hobbled what would have likely developed as economic dynamism by the 1970’s. Only by the 1990’s did we see a nod to open market realities which has led to an extraordinary period of 6 percent plus growth rates and the long overdue expansion of the entrepreneurial middle class. Even with impressive statistics of the past decade however, India still has a $1,770 per capita income and ranks 136th in HDI.
And of course modern China is viewed though the lens of socio/economic prosperity. Well it was not always that way. For the first thirty years of the People’s Republic of China, a rigid communist economy and totalitarian political system kept China’s potential in a socialist straightjacket. Since Deng Xiaoping’s economic reforms starting in 1978, China’s economy first evolved and then surged towards more open markets. Still, despite an impressive growth in the middle class, China remains an autocratic and corruption-ridden state. Despite the global recession China’s growth stands at 8.6 percent and ranks as number 101 on the list.
Impressively, the report cites the expansion of the middle class from over 525 million in the Asia/Pacific region in 2009 to an amazing projected 1.7 billion in 2020. This is truly impressive as the middle class tends to be the bulwark and foundation of democracy.
Of the top 35 ranked countries all, except Singapore, are fully democratic. While the UNDP report cites a proactive developmental state policy, tapping into global markets and determined social policy innovation, it fails to adequately address the transformative role of free markets and free trade to the equation. That’s often the key.
John J. Metzler is a U.N. correspondent covering diplomatic and defense issues. He writes weekly for WorldTribune.com.
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