Background
UNDP is the global development network of the United Nations, advocating for change and connecting countries to knowledge, experience and resources to help people build a better life. UNDP is on the ground in 166 countries, working with them on their own solutions to global and national development challenges and assisting them to achieve the Millennium Development Goals (MDGs).
UNDP conceives of development as a process of enlarging people’s choices to realize their potential and enjoy the freedom to lead lives they value. While international trade can be a powerful source of economic growth, which is a necessary condition for human development by expanding the material base for fulfilling human needs, trade alone is an insufficient condition for human development.
International trade grew at high rates in the immediate period before the economic crisis. Developing countries benefited from this trend. However, although growth in trade spurred higher rates of economic growth, the effect in terms of employment generation and poverty reduction has been disappointing, particularly in Sub-Saharan Africa.
One of the reasons behind this disappointing scenario is the nature of integration of poor countries in the global economy, and the distinct pre-crisis phenomenon of jobless growth. The economies of low income countries are typically dependent on a few commodities with limited linkages to the rest of the economy and value addition. While commodity trade growth may increase productivity and output in the formal sector of the economy, the employment and poverty impacts are likely to be weak given limited linkages with the local economy and the narrow range of opportunities for innovation and value added upgrading. Economic integration widens the range of traded goods, enhances the local impact of trade and has a positive impact on employment, particularly amongst the youth, who are the most likely to take up the challenges if equipped with adequate skills.
In the context of the global crisis and its aftermath, countries are re-assessing the importance of regional markets for outward looking growth strategies, employment, internal markets, and ‘green growth’ strategies. In this context, UNDP will produce in 2010-2011 a flagship report focusing on the benefits of regional integration and south-south trade for human development. The report will assess how strengthened regional economic strategies can contribute to human development, with the ultimate goal of influencing policy making processes and economic policies in developing countries.
In order to frame the discussion and introduce the relevant questions, the flagship report will lay out UNDP’s analytical approach to the linkages between economic integration and human development, which will determine the conditions – institutional, political or economic – under which linkages exist. In light of the theory, the report will also review examples of regional integration cases, and draw out factors that made those cases successful in promoting not just trade and growth, but also measures of human development. The theoretical findings and the conclusions based on existing regional integration experiences will be used to review current African regional integration efforts and frame the relevant questions to be explored. The report will then map out African trade flows (intra-regional and otherwise) and industrial clusters in order to inform an assessment of potential benefits and challenges, as well as assess current trade agreements and their potential for extension and deepening.
Duties and Responsibilities
The consultant shall deliver a 40-45-page report (excluding Annexes and References) on the conceptual linkages among regional economic integration, growth and human development.
Most of the recent development literature acknowledges the importance of economic growth as a means to human development rather than as the ultimate goal of a development strategy. Economic growth tends to improve human development, but this relationship should not be taken for granted. More importantly, improvements in human development lead to higher growth in return. Thus, any strategy to spur long-term growth should have human development as a focus.
The case for economic integration as a way to foster growth has been well established. While trade and unilateral trade liberalization do not always lead to higher growth, economic integration creates conditions in which trade and investment can have a more positive impact on the broader economy.
However, given the mutually enforcing relationship between growth and human development, the positive impact of economic integration on growth has to be translated into improvements in human development. It is only with a focus on human development that economic integration can lead to sustained, long-term growth.
The focus of human development, in turn, is changing. Human development in the XXI century implies improvement in the traditional indicators of poverty, inequality, health and education, but also environmental sustainability. Any progress achieved in the traditional measures of human development could be inhibited or completely derailed by the consequences of climate change and rising population burdens. Thus, the face and challenges of human development are also changing.
Listed below are issues the author is expected to cover in each section of the report.
- Economic growth and human development
- Review most recent literature on the relationship between economic growth and human development.
- Establish the basic argument that a human development approach to trade and economic integration leads to sustained and faster growth.
- Trade, integration and economic growth
- Provide an overview of the well-established case for economic integration.
- Review the latest literature on the benefits and costs of economic integration.
- Establish the conditions under which trade and investment positively contribute to growth and what the contribution of economic integration would be (e.g. enabling economies of scale, agglomeration, trade creation, etc.).
- Integration and human development
- Based on the arguments established above discuss how economic integration focused on human development can lead to faster long-term growth.
- Human development in the XXI century
- Discuss how new environmental challenges, notably climate change, should be incorporated into a human development perspective for the XXI century.
- Discuss the implications of environmental challenges for the type of economic integration necessary to reach growth and human development.
Reporting
The author is expected to be available for meetings to discuss the outline and contents of the report, as well as to present the report findings, either in person or online, subject to discussion with the lead Policy Adviser. The consultant is expected to incorporate comments and suggestions from the writing team and other reviewers on the drafts to be submitted.
Travel
Where the consultant is expected to travel to participate in meetings or to perform tasks identified in these TOR, travel-related expenses will be reimbursed by UNDP, based on the current practice and UNDP rates.
Schedule of payments
Payments shall be made according to the following schedule:
- First tranche of 40% upon submission of the first draft;
- Second tranche of 40% upon satisfactory submission of a revised draft, which should include comments from peer reviewers and/or the writing team; and
- Final tranche of 20% on satisfactory submission of the final report.
Competencies
- A minimum of 10 years of work experience in an international development context
- Solid knowledge of trade and trade integration theory
- Previous experience in producing trade-related knowledge products
- Familiarity with UNDP’s mandate and the concept of Human Development (particularly the 2007/2008 Human Development Report)
- Demonstrated ability to prepare high quality reports
- Ability to compile information from a variety of sources and synthesize it in a coherent structure
- Ability to work independently as well as part of an international team
Required Skills and Experience
- Post-graduate degree in political economy, development studies, development economics or a related discipline. A PhD is preferred.
- Expertise in trade and economic development
- Record of publications in trade and human development related topics
- Excellent writing skills in English