A joint report by the UN Economic Commission for Latin America and the Caribbean and OECD Development Centre examines the concept of development in transition.
It stresses that environmental impacts, technological advances, globalized trade and financial flows, and increases in migration and inequality can make traditional economic paradigms and policy strategies inadequate.
The paper presents a five-part toolkit for enabling smoother movement from graduation to gradation.
24 September 2018: A joint report by the UN Economic Commission for Latin America and the Caribbean (ECLAC) and the Organisation for Economic Co-operation and Development (OECD) Development Centre outlines the need for a comprehensive approach to international development cooperation that aligns with domestic policymaking, and supports the movement of countries up the income ladder. The paper on advancing the concept of “development in transition” was launched at an event in New York, US.
The paper titled, ‘Emerging Challenges and Shifting Paradigms: New Perspectives on International Co-operation for Development,’ outlines agendas around prosperity, people, peace, planet and partnership, to highlight opportunities for bi-regional partnerships between the EU and the Latin American and Caribbean (LAC) region, and aims to render international relations “more relevant, receptive and suited to the aim of leaving no one behind.”
Graduation entails moving up in terms of income level, while gradation means a constant, evolving form of engagement among countries.
Although recognizing that developing and emerging economies have increased their levels of national income, the authors lament that many countries still face “daunting multidimensional development challenges” on the road to lasting development gains. They highlight factors that have rendered traditional economic paradigms and policy strategies inadequate, including environmental impacts, technological advances, globalized trade and financial flows, and increases in migration and inequality.
The paper outlines a new paradigm of international cooperation in development, using a five-part “toolkit”:
- New development measures, such as those that go beyond per-capita GDP;
- Cooperation strategies that link to national strategies and reflect a multidimensional approach;
- Focusing the multilateral agenda to ensure that it is based on the SDGs and promotes the provision of regional and global public goods;
- Governance that is redefined to look beyond ODA and take into account South-South and triangular cooperation, as well as horizontal cooperation across different levels of government; and
- Modalities that extend beyond traditional instruments and include means of knowledge sharing and technology transfer.
This toolkit, the authors note, will enable smoother movement “from graduation to gradation.” They explain that whereas graduation entails moving up in terms of income level, gradation means a constant and evolving form of engagement among countries, as part of a renewed global commitment to the SDGs. For countries transitioning to high-income levels, the paper stresses that challenges are less related to finance, and more to building or strengthening institutional, social and technological capabilities needed to diversify the economy and increase cost efficiency. It warns, though, that while these dynamics can improve social and economic structures, the burgeoning middle class can remain vulnerable.
Providing remarks at the launch event, co-organized with the EU on 24 September 2018, ECLAC Executive Secretary Alicia Bárcena underscored that development in transition “represents a concrete multilateral effort to make progress” on the 2030 Agenda. Its approach to development cooperation goes beyond simply improving financial aid. An ECLAC press release also emphasizes that development in transition aims to foster new forms of cooperation that extend beyond Official Development Assistance (ODA).
In May 2018 the EU, OECD Development Centre and ECLAC launched a tool for promoting sustainable development in Latin America and the Caribbean as countries make the transition to higher income levels. The agreement on the Facility for Development in Transition was signed at ECLAC 37 in Havana, Cuba. [Publication: Emerging challenges and shifting paradigms: New perspectives on international cooperation for development] [ECLAC press release]