March 2001

SEMINAR: GOOD GOVERNMENT AND DEVELOPMENT

AS POLITICS GOES, SO GOES ECONOMICS

Seminar will examine ways to improve government as a means to reduce inequity and poverty in the region

Representatives from civil society, government and the press will examine the crucial link between good government and economic and social development in a seminar set for Thursday March 15, 2001 in Santiago, Chile. The event, "Good Government and Development," will be held in conjunction with the 42^nd Annual Meeting of the IDB's Board of Governors.

According to many observers, what has come to be known as "good government" is crucial if Latin America is to transform the impressive economic advances it has made in the past century into better lives for its citizens.

The seminar will be opened by IDB President Enrique V. Iglesias and Chilean Interior Minister José Miguel Insulza. Alberto Ruiz Gallardón, president of the Autonomous Community of Madrid, Spain, will give the introduction. Closing remarks will be presented by Colombian Finance Minister Juan Manual Santos.

Latin America had one of the strongest growth rates of any of the world's regions in the 20^th century, but poorly functioning political systems prevented this relative prosperity from solving problems of poverty and inequality. In the words of IDB President Enrique V. Iglesias, "with few exceptions, our public policies have been ineffectual, not because the underlying technical design is deficient, but because, in the absence of a broad democratic institutional base, it has been very difficult for governments to truly address the needs and aspirations of the citizenry." Furthermore, in a recent statement, President Iglesias pointed out that "once we acknowledge that institutions are indeed important, we must likewise acknowledge the importance of politics, since the caliber of a country's institutions depends essentially on the quality of its political system.

"Politics are the most sensitive and most visible expression of the linkage between institutions and the economy," said Iglesias. "Let there be no mistake, then: Politics matter."

Speaking at the seminar will be representatives from government, civil society, international organizations and the media. They include José Woldemberg, director of the Instituto Federal Electoral (IFE); Mónica Jimenez, Participa; Fernando Zumbado, International Center for Human Development; Rigoberto Queme, mayor of Quetzaltenango, Guatemala; Danilo Arbilla, president of the Inter-American Press Association; James Webb, Citizens Action for Free and Fair Elections, Jamaica; Carlos Jarque manager of the Sustainable Development Department, IDB; and Rafael Rocangliolo, of Transparencia, Peru.

The seminar will take a multidisciplinary look at the concept of "good government" and how to achieve it through reform programs that guarantee the democratic, political and legal environment crucial for equitable development. In particular, it will review activities that governments should undertake with the support of international cooperation, including projects to strengthen the rule of law, political reform, create systems of checks and balances, and increase the participation of civil society. Special attention will be paid to the challenges of electoral reform as an underlying condition for good government.

"In Latin America we have stressed the desirability of democracy in terms of respect for human rights and liberties, but not enough in terms of the functioning of the economy," said Edmundo Jarquín, chief of the IDB's State, Governance and Civil Society Division, before a recent seminar in Chile.

But even when the links between democracy and development are recognized, it is generally concluded that poverty, inequality, and low growth threaten democracy. "I have no doubt that this is an important relation," said Jarquín, "but we also must look at the other link, which is democracy as a fundamental condition for creating an efficient market economy with reasonable rates of growth and social cohesion."

The IDB has already financed many projects in the areas of taxation, relations with civil society, public administration, legislative and judicial reform to strengthen governance. The seminar will indicate other fields in which Bank investments in "good government" can promote democracy along with economic and social development.

"The seminar is thus designed as a tool to clarify both why institutional and political reforms should be carried out and suggest specific opportunities for IDB financing, " according to Fernando Carrillo, senior specialist in the Bank's State, Governance and Civil Society Division.