There is a need to tighten the regulatory framework in the global construction
sector alongside big infrastructure aid increases.
The WHO Commission on Macroeconomics and Health (CMH) identified
49 health services that constitute a basic package of health interventions, many
of which specifically target the diseases of geography identified in this chap-
ter. These include nutrition programmes and universal access to anti-malarial
nets. The cost amounts to $100 per person per year between 2005 and 2015.
Given that many developing countries have a GDP per capita of only $300 and
a government budget of $30 per capita, local sources could only ever pay a
fraction of this. The donor need until 2015 would be $40 billion annually for
Sub-Saharan Africa and $80 billion annually for the entire developing world.
In 2012 total gross aid was $76 billion; after deducting payments to middle-
income countries, loan repayments, emergency assistance and foreign consult-
ants only $12 billion was given as direct budgetary support to governments. An
increase in donor aid to fill this gap would represent an annual increase from
0.44 to 0.54 per cent of donor-country assistance (Sachs, 2005).
Increased aid targeted at infrastructure and health has been seen by its advo-
cates as its own exit strategy from the poverty trap and aid dependency. With
care in designing the donor–recipient process,such a commitment (not using
aid for consumption) could be enforced through improved monitoring of the
budget process, perhaps with the help of NGOs (Sachs et al.,2004). The results
of debt relief under the Highly Indebted Poor Countries (HIPC) initiative,
whereby resources made available by reduced debt servicing were targeted at
predetermined areas of public spending (especially social spending),have
been encouraging. There are good examples of health care interventions
successfully being scaled up with donor assistance. By 1974 donor-led efforts
had prevented an estimated 600,000 cases of onchocerciasis (African river
blindness),which made 25 million hectares safe for cultivation, and protected
40 million people from transmission. In 1988 polio was endemic in more than
125 countries; since then 2 billion children have been immunized against
polio,only 784 cases were reported in 2003 and it now remains in only 6 coun-
tries (Sachs, 2005).
Key points
- An adverse disease environment may divert resources at the household
level away from investment in physical and human capital to emergency
health care. Disease may reduce the human capital acquired through
schooling or learning on the job. - Poor geography, in particular being landlocked and isolated from interna-
tional trade and markets, may reduce the incentive of entrepreneurs to
invest in export-oriented sectors. - Adverse weather conditions may directly influence the (agricultural)
output of land.
248 Patterns and Determinants of Economic Growth