Bangkok, Thailand - I just participated in a technical workshop, “Investing in Capacities for National Development,” jointly organized by the ESCAP (Economic and Social Commission for Asia and the Pacific, UNDP (United Nations Development Program) and SNV (Netherlands Development Organisation). The workshop is in conjunction with the High-Level Ministerial Capacity Development (CD) Dialogue/Ministerial Session on April 27, 2009. The objective was to prepare an outcome statement and recommendations for the Ministerial meeting, reflecting the need to invest more strategically in sub-national CD. In other words, CD building at the local level.
 
The workshop brought together 70 participants from 10 Asian countries, including the Philippines. They discussed, debated and agreed on the need for increased investments in sub-national CD in order to achieve the MDGs.
 
The Philippine team included Jocelyn Reyes, Director of the Management Staff of NEDA, Ruby R. Esteban, Director, Department of Budget and Management, Grace Jamon, President of the Association of Schools of Public Administration in the Philippines (ASPAP), Amelia Supetran of UNDP Philippines, Mayor Jesse Robredo of Naga and myself representing the U.P. National College of Public Administration and Governance and Social Watch.
 
Mayor Jesse Robredo led the discussion on monetary and non-monetary incentive mechanisms as a CD strategy. He cited the experience of Naga City in attaining the MDG goals.
 
I presented a synthesis of three country research studies on investments in sub-national CD in three countries: Pakistan, Philippines and Vietnam. In my paper, I also examined the implication of the financial and economic crisis on investments in CD. The fiscal stimulus packages of countries in Asia-Pacific were analyzed in relation to possible investments in CD.
 
Three Asian countries and investments in CD
 
 Pakistan, the Philippines and Vietnam are obviously different from each other in terms of political systems, geographical location, and levels of economic and social development. Nonetheless, they exhibited similar patterns in CD.
 
While there was general acceptance of the obvious link between CD and the attainment of MDGs, there is a huge gap between acceptance of this simple truth and actual CD investments.
 
In Pakistan, while “the total size of the federal Public Sector Development Program was Rs 497.8 billion, spending on CD totaled just over Rs23 million.
 
In the Philippines, the allocation for CD in the Department of Agriculture was 5.08% of its total budget while the allocation for the Department of Education was .67% and the Department of Health at .61%.
 
It is actually at the local level where the link between investment in CD and MDGs is strongest and most visible. This is shown in two case studies I did involving a “rich” province—Bulacan—and a “poor” province, Negros Oriental. Both are multi-awarded and are characterized by sustained and committed political leadership, large investments in CD and highly qualified personnel.
 
Both provinces invested heavily in health, agriculture, fisheries and education.
 
In the case of Vietnam, spending for local CD stayed at 1% of total budget.
 
Economic stimulus packages in Asia and the Pacific
 
Donor and recipient countries are busy drafting economic stimulus packages for quick recovery programs. Thus focus is on rescuing banks and industries, tax packages, building of infrastructure, and conditional cash transfers.
 
Supposing recovery proceeds at a slower pace, can these programs be sustained since most of these packages are funded by borrowing?
 
The 2009 ESCAP report notes that “If the downturn is prolonged, longer-lasting public spending may be more valuable than fast-acting expenditures.” Such longer-lasting public spending would include social spending and investment in capacity development.
 
China has announced a stimulus package of $584 billion. It has also crafted another $124 billion package to improve the country’s health care system.
 
In South-East Asia, huge stimulus packages have been put up: Indonesia at $6.1 billion, Malaysia at $1.9 billion, Philippines at $6.5 billion, Singapore at $13.7 billion, Thailand at $3.3 billion and Vietnam at $1 billion. As expected the packages are largely on tax breaks and incentives, rescue operations for industries and infrastructure. The Philippines has set up a separate allocation for conditional cash transfers while Singapore’s package includes cash transfers to employers! Thailand promises a one-time cash distribution program while Vietnam is packaging subsidized loans to farmers.
 
Balancing short-term responses with CD
 
Truly effective CD focuses on communities and organizations. It builds up capacities to find solutions to not only survive the crisis but also to assure sustained growth when recovery finally comes.
 
The challenge to the Philippines is not only to provide quick-response solutions but also to balance these with substantial investments in CD.
 
This is the advocacy of the UNDP Capacity Development Practice Team in the Regional Centre, Bangkok, led by Ms. Dipa Bagai and Ashley Palmer, and SNV headed by Ms. Andy Wehkamp, Regional Director, Asia.
 
It is devoutly hoped that the ministers, including our own, will listen when they come to Bangkok this April 27.