DAWN - Cowasjee Corner; 07 March, 1999
The World Bank at Seoul
By Ardeshir Cowasjee
THE International Conference on Democracy, Market Economy and Development was hosted by the Republic of Korea and the World Bank in Seoul on February 26 and 27. The idea emerged from a conversation between South Korean President Kim Daw-Jung and World Bank President James Wolfensohn during which they agreed that recent events in Asia had shown that democracy and development were inseparable.
The aim of the conference was to convince the South East Asians that, for whatever it is worth, democracy is still the best form of government, and that there are ways and means available to be democratic without being corrupt and inefficient. As said Oscar Arias Sanchez, former president of Costa Rica, the ills of democracy can only be cured by more democracy.
An electronical gonging heralded the opening of the conference, commanding silence. The compere then announced the arrival of President of the Republic of Korea Kim Dae Jung and President of the World Bank Group James D Wolfensohn. All present were programmed to stand up and clap whilst the two made their grand entrance.
Having duly stood and applauded, we waited for the two presidents to seat themselves and resumed our seats. The compere proceeded to tell the gathering how happy the people of Korea were to mark the warm, hearty and spontaneous welcome accorded to their Great Leader. Were he to launch himself into a narration of the achievements of the leader, he said, it would take him days. However, briefly, the basic qualifications were there - the president had spent many a long spell in jail and survived many an attempt upon his life.
James Wolfensohn's detractors maintain that the difference between him and God is that the latter does not claim to be Wolfensohn. That may be so, but Wolfensohn has certainly revitalized the World Bank.
"When I came to the Bank," he told us, "corruption was a word no one was allowed to utter; so I redefined corruption as an economic and social issue. Corruption became a central item on the Development Committee's agenda." He pledged that the Bank would fight poverty with a passion. We await salvation.President Kim, in his opening address, said that the sufferings of Korea and other countries affected by the recent crisis have not been in vain as during the past year's struggle they have learned invaluable lessons. There must be a fundamental change in the approach to development, a paradigm shift towards a parallel pursuit of democracy and a market economy. For 30 years, Korea's stunning economic growth had dazzled the world and when the crisis hit, it was the unsound distorted structure of its economy that shocked the world. The greatest fault had been the neglect of the development of democracy alongside economic development. "If Korea had pursued a parallel development of democracy and market development from the start, it would have been possible to check the collusive relationship between government and big business, centred around the government-controlled financial sector."
We can learn much, if we want to, from the Korean example. In the past year, the number of central government ministries and agencies has been reduced from 21 to 17. The number of central and local government employees is being reduced by over 40,000. The number of government regulations has been reduced to half its previous level of 11,000.
In one year, Korea has built up foreign reserves from $3.9 billion to $50 billion, the current account deficit of $8.7 billion has been turned to a surplus of $39.9 billion, foreign investment has increased from $6.9 billion to $8.9 billion, and the exchange rate has been brought down by almost 50 per cent.
"Let me be clear," pronounced President Kim, "there must be a sweeping change in society. First, we must get rid of past, corrupt, inefficient, egotistical practices and rebuild the nation based on the principles of democracy and a market economy. In this regard, every citizen must be aware of his or her rights as well as responsibilities." Note : rights, yes, but not without responsibilities. The citizens of Pakistan have yet to learn the meaning of the word responsibility.
He continued : "Looking back on the past year of reform, I can draw one important conclusion. It is that introducing new laws and institutions alone is not enough. Reform can only succeed when these institutional changes are accompanied by changes in people's attitudes. This is the real test."
Five former heads of state and government addressed the opening session : Oscar Arias Sanchez of Costa Rica, Felie Gonzalez of Spain, Fidel Ramos of the Philippines, Poul Schluter of Denmark and Nakasone Yasuhiro of Japan.
Mr Sanchez dwelt heavily on the subject of corruption. "Currently, one of the greatest dangers to democracy throughout the world is corruption. Too often, our governments have suffered from the disservice of self-interested officials. These people have constructed unethical networks of privilege and used political power to benefit themselves. When exposed, these acts are profoundly disillusioning and poison public confidence in democracy. Yet many politicians have practised a form of corruption even more sinister. They avoid taking stances on serious and controversial issues, instead of saying only what public opinion polls indicate will be well received. They hide consequential facts about the challenges to social justice, and speak instead of the rosy fictions of general prosperity. They preach the virtue of free elections and public will, but practise deference to the wealthy individuals who make large donations to their campaigns. The truth of irresponsibility is not lost on the people of the world, who grow cynical and decline to participate in the injured formal mechanisms of democracy." Very, very close to home.
And on inflated defence budgets, "If we are to promote democracy and development, we must confront the monstrous irresponsibility of military spending. The sad fact is that half of the world's governments currently dedicate more resources to defence than to health programmes. Such distortions in national budgets contribute to poverty and retard human development .... the preparation for war is one of the greatest obstacles to human progress, fostering a vicious cycle of arms buildups, violence and poverty."
Discipline, one of our Founding Father's three points of exhortation to his countrymen, was stressed by the former Danish prime minister, Paul Schluter. His observation was that every society needs discipline, whether emanating from within or forced upon it from outside. Without the discipline needed to provide sound economic foundations, a country will fall behind in advancement. Discipline is not only a must for the fostering of growth but for the maintenance of a country on the path of sustained growth. Discipline is a must for the imposition of economic constraints that impose responsible economic policies, curb deficits and lavish spending. Discipline inhibits irregularities which distort the economy.
With no discipline and social cohesion, countries fall apart, disparity pits social groups against each other, mistrust becomes the norm, and, the ugliest of all, each group fights to secure for itself the largest slice of the national cake. Discipline is not an involuntary force upheld by fear of penalty. It constitutes the awareness of the population to respect the rules of society, both written and unwritten.
Jinnah realized all this over fifty years ago, as he realized that discipline is reflected in confidence in the legal system, for it is only with discipline that legislation can be felt to be just and equitably applied.
South Korea is doing its best. It is making giant efforts to move forward, to participate in the trend towards globalization, to meet the challenges of the new millennium. But it has one giant problem, a seemingly unresolvable problem - its Northern neighbour. A demilitarized two kilometer-wide zone runs across the peninsula at the 38th parallel, separating South and North Korea, patrolled by some million and a half troops from both South and North who perennially guard the strip to keep it neutral. This is the world's most fortified border, one of the last remnants of the cold war, dividing Stalinist North from democratic South.
North Korea, of course, remains somewhat of a basket-case, in desperate economic plight, stricken with famines, mass poverty and oppression, bent on the development of long-range missiles and a nuclear facility. Though it has lost its 'fatherland,' the dead 'father' still rests above ground, in Father Lenin fashion, for all to see and wonder at. Their uncountable generals have even surpassed the old Soviet counterparts in the quantity and weight of the medals they sport on their uniforms. Metal spreads across their chests from armpit to armpit, as with the Soviets. But, unlike them, metal also spreads across the North Korean top-brass covering their body width below the belt.