Introduction

The Need for a War on Poverty

Promoting effective and inclusive systems of government, including an accountable security sector, is an essential investment in the prevention of violent conflict. The promotion of peace and stability is indispensable if countries are to attract investment and trade, and promote pro-poor development.

Violent conflict is one of the biggest barriers to development in many of the world’s poorest countries. Of the 40 poorest countries in the world, 24 are either in the midst of armed conflict or have only recently emerged from it. This problem is particularly acute in Africa where twenty per cent of the population live in countries affected by armed conflict. Armed conflict also leads to population displacement. It is estimated that 10.6 million people in Africa are internally displaced – the majority of them uprooted by war.

At the beginning of the new millennium roughly 1.5 billion people have an income of less than US $1 a day, meaning that one-quarter of humanity live in abject poverty. The proportion of people in poverty is now more than 40 per cent in sub-Saharan Africa and South Asia and rising. Over the past five years the number of poor people has increased by 200 million in sub-Saharan Africa, in the transition economies of Central Asia and Eastern Europe, and in South-East Asia.

Having decent employment is the best guarantee of income security, but some 1 billion workers – one-third of the world’s labour force – are either unemployed or underemployed. The figures speak for themselves : 150 million people are seeking or available for work but are unable to find it; 850 million people work less than they wish to work or earn less than a living wage. Women constitute a large proportion of them, and are often the sole providers for the family. Income security is threatened by the global trend towards the informalization of labour contracts and informal sector and temporary employment. In Latin America and the Caribbean, for example, 40 per cent of the labour force is in the informal sector, and “work” in this sector has expanded significantly in the 1980s and 1990s.

Children and elderly people tend to find less security and support within the family than in the past. All over the world one-parent families are becoming more widespread. In many developing countries, when fathers migrate to the cities for work, mothers, children and grandparents are left behind in the rural areas. Poverty drives about 250 million children to work and jeopardizes their attendance at school. In many developing and transition countries, people find themselves without income protection when they grow too old to work.

Successive structural adjustment programmes have led to severe cuts in public social budgets, with the result that governments are now much further away from the goal of guaranteeing universal access to free primary health care and education. The World Health Organisation Report in 1999 estimated that over 1 billion people are entering the twenty-first century without recourse to the health revolution. Their lives remain short and treatable disease and disability remain untreated. In developing countries more than 40 per cent of primary-school-age children are or will remain illiterate. According to UNICEF over 130 million of these children, including 73 million girls, do not have access to primary education; another 150 million will drop out before grade five. (UNICEF, 1999)

As the UN Secretary-General put it in his report to the Millennium Assembly :

“The central challenge we face today is to ensure that globalisation becomes a positive force for all the world’s people, instead of leaving billions of them behind in squalor. Inclusive globalisation must be built on the great enabling force of the market, but market forces alone will not achieve it. It requires a broader effort to create a shared future, based upon our common humanity in all its diversity.”

Making globalisation work more effectively for the world’s poor is not only a moral imperative, it is also in our common interest. Many of the world’s contemporary challenges – war and conflict; refugee movements; the violation of human rights; international crime; terrorism and the illicit drugs trade; the spread of health pandemics like HIV/AIDS; and environmental degradation – are influenced or exacerbated by poverty and inequality.

This mutual dependence is particularly clear in the case of population growth and environmental degradation. In the next 25 years around 2 billion people will be added to the world’s population – 97 per cent of them in developing countries. There will be a further shift of population from the rural areas to the towns, with an estimated 61 per cent of the world’s population living in urban areas by 2025.

These demographic changes will create huge new demands. Managed badly, this could lead to growing conflicts over scarce resources, particularly water and new social tensions that could easily spill over national borders. There can be no secure future for any of us – wherever we live – unless we promote greater global social justice.

Progress is dependent on developing country leadership. But some of the resources needed will have to be provided by the international community. A sustainable global environment and effective vaccines against communicable diseases are just two examples of the global public goods that can and should be financed internationally.

Poor people suffer disproportionately from poor health and malnutrition. The poorest 20 per cent of the global population have a 14-fold higher risk of death in childhood than the richest 20 per cent. Similarly, more women die from pregnancy in India in a week than in the whole of Europe in a year.

Better health is essential if poor people and countries are to benefit from globalisation. For individual families, better health means less suffering and less time and expense invested in caring for ill family members, improved physical and intellectual development, enhanced school attendance and learning, and higher productivity at work. For countries, better health is now accepted as a central long-term driver of economic growth. For example, it has been estimated that controlling malaria in those parts of Africa where it is endemic would raise Gross Domestic Product by 20 per cent over a fifteen year period.

Education and skills are the commanding heights of the modern global economy. Globalisation – and the growth of knowledge-based systems of production – is both increasing the rewards for education and raising the costs of exclusion from it. If globalisation is to work for poor people, increased investment in education, lifelong learning and skills is essential.

One of the ways in which globalisation could help to eliminate poverty is by speeding up the diffusion of knowledge and technology to developing countries. But for countries to make use of modern technology, they must improve education and skills training.

Where countries invest in high-quality primary education for all – particularly for girls – the development dividends are enormous. Education of girls is probably the single most effective investment in development that any country can make. Huge numbers of children today – girls and boys – do not take even this initial step. An estimated 113 million children of primary-school age have never gone to school. Around 150 million children have dropped out after a few years, still unable to read, write or work with numbers. One in four adults in the developing world – that is 870 million people – are unable to read or write.

Since the end of the cold war and the almost universal collapse of communism the circumstances have existed for a massive transfer of arms expenditure towards increases in development aid to help bridge the gap in living standards between the world’s richest and poorest countries. This opportunity has led to lower expenditures by many States however tensions and ongoing conflicts in several regions plus the events of September 2001 are resulting in massive growth which is going beyond the reductions of past years.

The terrorist acts of September 11 along with a range of other regional tensions and crises appear to have dramatically changed the inclination of political leaders in many parts of the world towards the need to reduce military expenditure.

The most public of recent statements regarding the need to increase expenditure has been that of the President of the United States who proposed recently that an additional (US) $50 billion would be provided to develop new armaments and provide additional payments to personnel in the military forces. Other regions and countries which have in recent years announced significant increases in their military budgets include Africa, Australia, India, Pakistan and Russia.

Trends In Arms Expenditure

The world military expenditure in the year 2000 was a provisional figure of $798 billion. This represented an increase of 5% over 1998. Spending increased in all of the main regions during the three years 1998-2000. Whilst the level of Russian military expenditure is only one sixth of that of the United States its level in real terms increased by 43% in the period 1998-2000. The region with the steepest rise is Africa where military expenditure increased by 37% in real terms between 1998 and 2000. In South Asia the India-Pakistan conflict has brought about a 23% increase in expenditure in real terms.

The reality is that a decade after the end of the cold war the decline in military spending is changing into growth and this trend started before September, 2001.

The increase in world military expenditure – 5% in real terms between 1998 and 2000 – reflects large increases in the USA and Russia, and rapidly increasing military expenditure in Africa and South Asia, and a resumption of procurement programmes in many parts of the world.

In the case of the United States, the post-cold war reduction in US military expenditure was significant – about 25% in real terms between 1990-2000. Its level in 2000 was about the same as 1980 prior the start of increased military expenditure by the Reagan administration. However the events of September 2001 are projected to sweep away all of the reductions in arms expenditure of the last decade.

In the case of Europe, military expenditure in Western Europe fell by 15% in real terms between 1991-2000. The reduction in expenditure took place mainly in the first half of the decade and since then has increased by three per cent in real terms.

In Central and Eastern Europe expenditure fell by around 10% between 1991 and 2000. Despite other pressing economic demands the Baltic States have devoted an increasing share of GDP to military purposes – Estonia’s military expenditure doubled between 1996 and 2000 in real terms, Latvia’s increased by 66% and Lithuania’s more than tripled.

Other significant changes in recent times include :

In summary the regions which account for most of the increase are Europe (36 per cent of the increase) and the Americas (28 per cent). The USA, which accounts for 37 per cent of total world military expenditure, raised its military spending by 2.3 per cent over the two years 1999-2000, an increase of $6 billion (at constant 1998 prices). The increase in Europe mainly reflects the extraordinary increase in Russian military expenditure. However, because of the preceding sharp reductions during the 1990s, the current level of Russian military expenditure is now more comparable with that of the main European countries than with that of the United States.

Three other regions (Africa, Asia and the Middle East) account for 11-14 per cent each of the increase in world military spending in 1999-2000. Their shares in the overall increase are lower partly because their regional military expenditure is lower. The regions with the steepest rise in military expenditure during 1998-2000 are Africa – an increase of 37 per cent in real terms – and South Asia – 23 per cent in real terms. The increase in Africa is due primarily to armed conflict in a number of countries in the region. Countries contiguous to conflict countries have also had significant increases in their military expenditure.

There is strong pressure from NATO and the US Government on the governments of the European NATO countries to increase their military budgets in order to live up to their Defence Capabilities Initiative commitments and increase the interoperability of their armed forces with those of the USA. Other major spenders, such as Japan, China and Russia have also adopted procurement plans which will require increased military budgets in the future. The level of military production in the Russian defence complex almost doubled between 1998 and 2000 to a level corresponding to 18.7 per cent of the level of the Soviet Union’s military output in 1991, the last year of its existence.

The arms industry is also pressing for new orders. In spite of a turbulent period of industry consolidation during the 1990s, significant overcapacities reportedly remain.

Weapons Of Mass Destruction

There are five declared nuclear weapons states in the world : The United States, Russia, Britain, France and China.

Three more states, Israel, India and Pakistan, had for some years been described as threshold states : although they had never admitted it, it was generally accepted that they had or were very close to having nuclear weapons. In the case of India and Pakistan, this of course has now been confirmed by their recent tests.

South Africa has now admitted that it did have nuclear weapons but it has now scrapped them. Three states, the Ukraine, Belarus and Kazakhstan, formerly parts of the Soviet Union, did have nuclear weapons but have now either scrapped them or sent them back to Russia.

Iraq, Iran and North Korea have had, and may still have nuclear weapons construction programmes.

Belgium, Germany, Greece, Holland, Italy and Turkey as well as Britain, as members of the North Atlantic Treaty Organisation (NATO), have US nuclear weapons based on their soil.

Since many nuclear weapons are installed either on surface warships or in particular on submarines, they can in practice always be found almost anywhere in international waters.

Finally any state with a nuclear power industry is in a strong position, if it so wishes, to develop its own nuclear weapons.

The Spread Of Ballistic Missiles

One of the most disturbing trends in the pattern of ballistic missile proliferation has been the establishment of patterns of technology transfer between nations that have enabled developing nations previously reliant on potentially uncertain supplies of entire missile systems from abroad to establish autonomous production capabilities.

The increasing rate of this transfer of missile technologies can be gauged from the fact that of the 15 countries that are currently establishing autonomous ballistic missile production capabilities or that have recently terminated their missile development programmes, only two, China and Israel, had tested a missile before 1984.

The most widely proliferated ballistic missile is the Soviet SS-1 Scud B, which has been exported in large numbers to at least 22 states in Eastern Europe and the Developing World. It is there SS-1 Scud exports, combined with reverse engineering and the establishment of autonomous production capabilities by third party states, which have formed the basis of the modern-day missile proliferation problem.

The best known of these Developing World ballistic missile programmes is that if Iraqi dictator Saddam Hussein, whose programme was based upon the modification of Scuds supplied by the Soviet Union during the 1980s. Similarly, North Korea’s growing ability to produce increasingly long-range ballistic missiles can be traced back to the small number of Scud Bs it imported from Egypt in 1981- Scuds which Egypt had in turn purchased from the Soviet Union. With technical assistance from China and financial support from Iran, North Korea had developed an indigenous Scud manufacturing capability by 1986.

China’s ballistic missile programme, the oldest, most-advanced and most diverse in Asia, can also be traced back to the reverse-engineering of a Soviet missile system, in this case the R-2 (SS-3) IRBM, two of which the Soviet Union exported to China in 1958.

Argentina and Brazil have also emerged as ballistic missile suppliers. In 1982, Argentina instigated the Condor project which was funded by Egypt from 1984 and by Iraq from 1985. The Condor 2 was a two stage, solid-fuelled missile intended to carry a 450 kg payload (possibly a nuclear warhead) at least 900 km. Iraq also received considerable assistance from Brazilian technicians during the 1980s in developing its long-range Tamuz and Al Abid missiles.

Developed nations have also been involved in the transfer to technology to third parties. Israel received significant technical assistance from France for its Jericho ballistic missile programme. Israel, in turn, is suspected of having supplied Jericho technology to South Africa during the 1980s for its now-terminated Arniston ballistic missile programme. The Taiwanese Ching Feng (Green Bee) is reverse-engineered from the US Lance BSRBM, while South Korea’s NHK-series ballistic missiles are reverse-engineered from the US Nike-Hercules SAM.

Perhaps the best documented example of how the suppliers’ network functions comes from the Iraqi ballistic missile programme of the 1980s in which foreign assistance – both overt and covert – was central to Iraq’s ability to develop an autonomous extended-range Scud production capability. Using oil revenues to fund a huge missile technology procurement network and exploiting a tacit Western backing for Iraq in its war against Iran, Saddam Hussein found that he was able to obtain almost any missile technology, either legally or illegally. He also had no difficulty in recruiting thousands of skilled foreign engineers and technicians. During the 1980’s Iraq established formal contacts with Brazil, China, Egypt, France and the Soviet Union, facilitating the sale of missile technology, joint research programmes and the education of specialist Iraqi personnel. Iraq also reached covert agreements to circumvent international arms control regimes such as the MTCR, with Argentina, Brazil, East Germany, Libya and South Africa.

The clear lesson to be drawn from this web of suppliers and purchasers is that those countries that wish to develop an autonomous ballistic missile production capability are now able to acquire from abroad key technologies and expertise that would otherwise take them many years to develop indigenously. The increasing rate of missile proliferation since 1984 also suggests that growing numbers of nations will attempt to develop such autonomous capabilities. Moreover, the progress of the missile programmes of nations such as North Korea provides strong evidence that ballistic missile threats will grow not just in terms of numbers of weapons and numbers of nations holding them, but also in terms of increasing range and increasing accuracy. These missile threats will also become more lethal given the growing problem of the proliferation of Weapons of Mass Destruction.