http://www.guardian.co.uk/business/story/0,3604,1367156,00.html Brain drain must stop if poor countries are to be helped
Larry Elliott Monday December 6, 2004 The Guardian The west is stripping the developing world of its talent. The pressures of ageing populations and the need to be at the frontier of technological change has meant skilled labour is in short supply, so raiding parties have been sent out to find doctors, nurses, teachers, scientists and IT specialists prepared to move to Europe or North America. We want highly qualified expatriates to staff our hospitals and laboratories, even though the consequences for the developing countries affected by the brain drain are severe. Recent research from the Organisation for Economic Cooperation and Development shows the extent of the problem, particularly for smaller nations. For the big beasts of the developing world - China, India and Brazil - the loss of highly skilled workers amounts to less than 5% of the stock available in their countries. But for the smaller nations of the Caribbean and Africa, the figures are frighteningly high. Mozambique, Ghana and Tanzania have seen almost half their highly skilled populations leave the country. For Jamaica, it is about 75%. This brain drain is being encouraged by the inducements offered by the west, even among those countries that tend to have an exemplary record in development. In Sweden, for example, key foreign personnel who are in scarce supply pay no taxes on 25% of their income for 10 years. Similar tax breaks are offered by the Netherlands and Austria. Losing elite workers - especially when you don't have many of them in the first place - hurts. The OECD makes the point that "emigration of highly skilled workers may adversely affect small countries, preventing them from reaching a critical mass of human resources, which would be necessary to foster long-term economic development". A recent paper by Sanjaya Lall, of Oxford University, puts things into perspective. Manufacturing, he says, is vital for Africa's growth. One of the conditions for a thriving industrial sector is a good investment climate - sound macroeconomic policies and property rights - but it also requires a range of technological, managerial and institutional abilities. East Asian countries have developed the capabilities necessary for success in an increasingly competitive global market; Africa has not. "Low wages as such are no longer the main competitive factor in manufacturing: it is low wages for skilled, disciplined and capable labour. Africa has low wages but also low skills and capabilities. The stock of formally educated workers is small relative to other regions. Vocational training is held in low esteem in much of Africa and the provision of such training tends to be weak, obsolete and delinked from industrial needs. The shortage of technical skills is particularly severe at higher levels." Lall says the gap between Africa and the rest of the world widened in the 1980s and 1990s, and it is likely to carry on widening if the poorest countries are deprived of the workers that can make their industries internationally successful. While it is of concern that Africa's share of world manufactures fell between 1980 and 2000, of even greater importance is the danger that it will be pigeon-holed as a supplier of primary products to the west. "It is practically off the map in the most dynamic and technologically rewarding areas of manufacturing," Lall says. "Not only is Africa becoming marginal to the dynamics of the global economy, it shows little signs of a technological response to the new challenges." Market access to rich countries is something of a red herring, he argues, with the real problem being low productivity and a lack of industrial capability. The issue of capacity is starting to interest development experts, some of whom have started to question whether poor countries can absorb large financial flows without straining their economies to breaking point. Without a thriving supply side, there is a risk that a sudden surge of cash from outside might lead to rapid inflation and a rise in the real exchange rate which would choke off exports and jeopardise growth. Such concerns need to be addressed, because much time and effort is going to be spent over the next 12 months trying to mobilise extra resources for development so that the world can "make poverty history". The motivation is that targets have been set by the United Nations for the state of the world by 2015 - universal primary education, a two-thirds cut in infant mortality and a halving of extreme poverty - and on current trends they will be missed. The aid agency Oxfam puts numbers on the price of failure. There will, it says, be 247 million more people in sub-Saharan Africa living on less than a dollar a day in 2015, 45 million more children will have died, an extra 97 mil lion will have been deprived of a place in school, and 53 million more will lack proper sanitation facilities. It's up to the rich countries of the west, Oxfam argues, to pay the price for avoiding this human tragedy. The developed world should live up to its promises on aid, it should scrap the debts owed by poor countries to the World Bank and the International Monetary Fund and it should tear down the protectionist barriers that price cheap exports from Africa out of western markets. Bono, quoted in the Oxfam report, puts it like this: "We are the first generation that can look extreme poverty in the eye, and say this and mean it - we have the cash, we have the drugs, we have the science. Do we have the will to make poverty history." To which, almost certainly, the answer is no. If we set out in 2005 imagining that by the end of the year, the G8 will all have signed up to a doubling of aid flows, that they will have written off all the unpayable debts of African countries and that they will have opened up their markets to low-cost products from the developing world, we are in for a nasty shock. By the end of 2005, we will not have made poverty history. That is not to denigrate the efforts of the aid agencies, still less to underestimate the commitment to Africa of Gordon Brown and Tony Blair. The prime minister's Africa Commission will report back in the spring and Britain will use its twin presidencies of the G8 and the European Union next year to press the case for extra resources. This, need less to say, is proving tough going, but ultimately finding the money might be the easy part. The current orthodoxy is that that the UN's goals will only be achieved if there is a rapid injection of additional development assistance. But an increasing number of development experts are now privately questioning whether hitting the 2015 targets is the right goal. The point, they say, is to provide a long-term development path which not only allows Africa to emulate (to some extent) the performance of the Asian tigers, but also brings tackling profound inequality within poor countries into the equation. Extra resources are vital; of course they are. There is evidence - plenty of it - that aid can help put children in school rooms and build the roads that allows farmers to take their food to market and thus generate a surplus for future investment. But the idea that debt forgiveness, a doubling of aid and fairer trade rules is the end of the story is a fantasy, and probably a dangerous one at that. If the Africa Commission merely reheats the old nostrums - more aid in return for open governance, debts written off provided countries liberalise - it will be a missed opportunity. [EMAIL PROTECTED] � Counting immigrants and expatriates in OECD countries: a new perspective: oecd.org � Stimulating industrial competitiveness in sub-Saharan Africa: Sanjaya Lall, International Development Centre, Oxford University. Paying the Price: oxfam.org.uk
