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CHAPTER 4
Rising to the Challenge: Priorities for the
Developing Countries and the International
Development Community
The changes that will result from the new technologies described at this
symposium will present a different face to different countries. Many countries
simply do not have the minimum levels of capital, infrastructure, human resource
capability, basic services, and technological awareness to benefit from the tele-
communications/computer revolution over the short term. Many of these coun-
tries, however, are the very ones that will have to rely most on technology to
relieve the pressures on their food supply, health and education services, and
environment that will accompany the next doubling of the world's population.
Ironically, while the rapid changes fostered by today's sophisticated telecommu-
nications and computer technologies are likely to become reality and many of
them already are those still required for survival remain on the drawing board.
The international development community must, therefore, not abandon its ef-
forts to assist these least-developed countries. The telecommunications/computer
revolution may, in fact, have little to offer them.
For other countries, however, there are opportunities to grasp that would
allow them to catch up with the developed countries, with the world economy,
with their own environmental remediation requirements, and with the demands of
their own growing populations. But to succeed, they too will require some assis-
tance in planning, some awareness-raising, and substantial changes for invest-
ments in economic growth.
This chapter seeks to identify some of the priorities, delimited by problem
area, that will permit developing countries to accelerate the process of applying
This chapter draws substantively on the invited papers by Baruch (technological innovation and
services) and Shine (health technology), as well as the discussions of the break-out groups.
50
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51
the new tools offered by the technology revolution. Most of these priorities must
be implemented by the countries themselves, the private sector, and the scientific
community. Others will be part of an international effort coordinated by develop-
ment agencies and the World Bank. This chapter will conclude by examining the
corresponding new roles for the cast of actors on the international stage.
FOOD SUPPLY
The population pressures that will affect a significant number of the world's
countries in the early twenty-first century give priority to issues of food security.
The increases in crop and livestock production that will be required, estimated at
greater than 100 percent over the next 40 years, will have to come mainly from
gains in yields per hectare, mostly on land already under cultivation. This will
require technological advances in agriculture that can be compared in scale and
impact only to the green revolution of the 1960s-a revolution that was largely
led by international research centers located in developing countries, funded by
international organizations, developed countries, nongovernmental organizations,
and host governments. But since the sixties the international political climate has
changed. The global markets are no longer dominated by so few countries, and
the private sector plays a greater role in research and development. Nevertheless,
the remedy for projected food shortages remains the same: more technology.
Basically, three farm types are found in the tropics: the industrial-scale or
plantation sector; integrated, multicrop farms; and the traditional farms, usually
found in marginal-soil or low-resource areas. In general, private market incen-
tives should suffice to spur growth in the commercial plantation sector. Thus
efforts to promote increases in the food supply should focus on productivity and
concentrate on the most competent, integrated, multicrop farms found in high-
resource areas. New technologies must be introduced on these integrated farms;
newly strengthened national research and educational institutions could help to
develop or transfer the technology and support productivity gains. Such measures
also might have an impact on the traditional sector if efforts are made to study
and improve traditional crops and farming systems. Assuming the new technolo-
gies will be forthcoming, the key problem will be getting them into the hands and
the minds of the farmers technology transfer.
Market incentives for the adoption of biotechnology-generated products gen-
erally reach the plantation sector. But the integrated farm sector has less access to
information and may be more conservative about new technologies, having less
margin for survival. Promotion, demonstration, and extension may be essential to
the further adoption of new cultivars and improved varieties. Investments in soil
productivity enhancement, associated with crop rotations, conservation tillage
practices, increased efficiencies of fertilizers and pesticides, and improved farm-
ing practices to avoid erosion and runoff, will provide major gains. For the
traditional sector, scientific breakthroughs that might permit the cultivation of
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52 , Marshaling Technology for Development
high-value commodities on marginal lands without unduly degrading the envi-
ronment would make a major impact. This problem, however, holds little interest
for the developed countries, where most biotechnology research is carried out.
Solutions, then, should be pursued in national and regional agricultural and bio-
technology research centers.
PRODUCTIVITY AND COMPETITIVENESS
It is in manufacturing and services that developing country firms perhaps
have the best chance of using advanced technologies to propel them into equal
participation in global markets. But two conditions must be satisfied for these
firms to become integral parts of global integrated manufacturing networks: the
developing country firms must be competitive in price, timeliness, and quality;
and the policy environments of their countries must be conducive to global
production.
The notion of "design-for-developing countries" will work if these countries
are able to offer access to large or emerging markets, or to sources of materials
that cannot be readily obtained elsewhere. For example, a developing country
firm could introduce a product such as an electric water pump designed for a
consumer appliance to a new market for use in tandem with a solar generator.
Another firm might provide workers with a moderate level of education and skills
at relatively lower wages. Or a firm might offer boutique manufacturing because
it is small enough and flexible enough to custom manufacture on demand and in
small quantities. Consideration of the new patterns in collaborative manufactur-
ing will help to identify many opportunities for manufacturing enterprise devel-
opment in developing countries.
In much of the developing world, the industrial sector is dominated by a few
very large firms and a large number of cottage industries. Middle-sized compa-
nies that have the flexibility and capability to serve as reliable suppliers in a value
chain are in short supply. For such countries to compete, new government-devel-
oped incentive programs could encourage the formation of such mid-sized firms
to serve as a supplier base, thereby reducing imports of subassemblies and com-
ponents. Proximity of suppliers is a valuable asset, as is the timely import of high-
technology components such as displays or integrated circuits that are not manu-
factured locally. Similarly, a good transport infrastructure, including rapid
customs services, is important. The establishment of industrial parks and duty-
free zones would encourage participation in global networks.
For some countries, substantial changes in the domestic economic environ-
ment-such as low inflation, deregulation, and intellectual property rights pro-
tection and a commitment to change by both the government and the private
sector will be needed to create the climate for effective participation in global
networks and markets. But any such changes should be undertaken as part of a
vision of the future created and articulated by each country. All sectors govern
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meet, private sector, universities, labor should contribute to that effort and then
identify and carry out the actions to achieve that vision. A mechanism useful for
this purpose is a national government-university-industry roundtable at which
government officials, business leaders, scientists and engineers, and economists
exchange ideas and prepare a plan for public debate and government decision.
Nongovernmental organizations, particularly trade associations and professional
associations, also should play a part. The knowledge required for rational deci-
sion making in this area is not exclusively held by governments. The challenge
presented by the technology revolution requires participation by all sectors of
society.
Such a vision should be supported by a strategy to fulfil it. A country may
decide to enter global manufacturing markets in areas where it has a comparative
advantage by first offering peripheral components or services such as software,
spare parts, field services, tools, or postharvest processing of agricultural prod-
ucts. These arrangements could be consolidated by license, joint ventures, for-
eign direct investments, or government-required offsets on other contracts. Such
ventures will spin off knowledge of the technologies and of the international
markets. Later, the country may wish to introduce products to local markets, enter
into long-term partnerships with major international producers, or undertake com-
plete product manufacture in competition with producers in other countries. Each
country must be firmly aware of its own interests and recognize that no one gives
away anything valuable. Today's technologies may be available for license, but
only when tomorrow's are on the test bed.
Governments, in collaboration with the private sector, can take several kinds
of actions to implement their visions. For example, in a competitive environ-
ment low-cost labor will by itself count for less, but a moderately low-wage yet
educated and trainable work force may have a definite competitive advantage.
Even so, the cost to a firm of training may offset low direct labor costs, and thus
it may be advantageous for government to share training costs and to take
measures to discourage the practice of one firm hijacking workers trained by
other firms. Government also could create institutions that offer training in the
management of technology, possibly following the model of the institute set up
through joint U.S.-Chinese cooperation at Dalian. Other services that would
assist local firms are: technology scanning and forecasting, technology demon-
stration and transfer institutes, trade shows, and technical information services
linked to worldwide information networks. Information also might be distrib-
uted through the facilities of other public services, such as electricity and tele-
phone, that reach most establishments.
Deregulation and the elimination of trade barriers are important steps along
the path to competitiveness. New informatics technologies are, in any case, erod-
ing the capability of regulatory agencies to control the service industries, or to
prevent domestic services from being marginalized by international competitors.
An example is modular telephones, which can undercut local telephone services
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Marshaling Technology for Development
and provide untaxed and unregulated international service as well. (In Chapter 2,
however, this example is used positively as a way developing countries can
jump-start a telecommunications industry.) Obstacles to foreign direct invest-
ment and to high-technology imports can impede local participation in global
markets. A closer look at the experience of the newly industrializing countries of
Asia and Latin America would be useful. The World Bank and other neutral
parties are ready to advise developing countries in the area of regulatory reform.
The success of many of the actions described here will depend on coopera-
tion from the developed countries, from investors who see a profit in working in
the developing countries, from manufacturers seeking partners, and from scien-
tists and engineers who can provide valuable advice. Communication among all
these players is essential, and this too could be facilitated by modern informatics
technology. On an Internet bulletin board, questions can be posted and answers
returned, and third parties can comment on both the questions and the answers. A
bulletin board devoted to the technological aspects of development could serve as
a forum for questions from developing countries on technological opportunities
and answers from investors, potential partners, and scientists and engineers, with
commentary from the World Bank and other international monitors. This initia-
tive would cost virtually nothing and could be either informal and open to the
public or restricted to a defined group.
ENVIRONMENTAL AND ENERGY TECHNOLOGIES
Technology will contribute in different ways in the environmental arena.
Pollution and resource depletion, the two faces of environmental destruction
may find some sources of remediation among the emerging technologies. New
techniques for bioremediation can clean up some of the damage to fragile envi-
ronments, such as oil spills or heavy metal contamination. Similarly, other tech-
nologies, developed in the West in response to public agitation over hazardous
waste sites and industrial pollution, can reduce the emissions and clean the efflu-
ent from industrial plants. These technologies can be licensed and applied in
developing countries before extensive damage has been done.
Energy generation and use are a major source of pollution, but many new and
emerging technologies for efficient, cleaner electricity generation are available
and well suited to developing countries. In fact, this is a good time for developing
countries to add new, more efficient low-emission technologies to their capital
stock while per capita demands are still low. Based on current demand projec-
tions, in 20 years the developing countries will require a tenfold increase in
generating capacity as well as end-use equipment. Fortunately, these countries
are in a position to leapfrog to a new generation of technologies that is far more
efficient, less costly, and less polluting than was historically available to the
industrial countries. even at a far more advanced state of development. The result
will be an approach from below to the present-day optimal level of energy use per
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capita for the given size of an economy, instead of the path of expensive retrofit-
ting required in many developed countries.
During the oil crisis of the seventies, many international organizations and
bilateral donor agencies undertook extensive energy planning, assessments, and
research programs. Today's situation may be just as critical in the long run. Many
countries, finding themselves undercapitalized in the energy sector and with
growing demand, are making key decisions that will affect the economy and the
environment for a long time. The issue this time is not so much the choice of
fuel although there are still choices to be made among fossil fuels, renewables,
and nuclear than that of generating and end-use technologies and their relative
benefits in terms of high efficiency, decentralization, and pollution control. The
scientific community, supported by donor and development organizations, should
take the lead in providing good offices and advice for these important decisions.
The great importance of macroeconomic stability, of pricing and tax policies
based on economic principles, and of a satisfactory regulatory framework for
investment, is well known. Government must play a key role in sending consum-
ers the right signals and enabling markets to function efficiently. This role should
embrace such approaches as (1) setting standards and codes (for example, for the
performance of buildings, appliances, and equipment); (2) monitoring pollution,
establishing environmental standards, and introducing environmental taxes, laws,
and regulations (such as for phasing lead out of gasoline); (3) attending to prop-
erty rights issues, which can be important for the design of environmental policy
(rights of the polluting and the polluted parties) as well as for investment; (4)
providing investment incentives for the adoption of new and innovative technolo-
gies; and (5) providing for the sharing of risks, especially important in countries
with undeveloped capital and insurance markets.
RESEARCH AND DEVELOPMENT
The research and development community has brought the world the com-
puter/telecommunications, materials, and biotechnology revolutions. A creative
partnership of the public and private sectors in the Western countries and Japan
produced most of the new technologies discussed in this proceedings and is in the
process of changing the world. One would not assume that the research and
development system needs any remediation, but in many sectors it is not, in fact,
providing the innovations and discoveries required for the problems of most
importance to developing countries. Most fundamental research is done in and by
the developed countries, and much of the applied and developmental research is
carried out with their large and affluent markets in mind. The needs of the poorest
countries or of some tropical countries-especially in agriculture, health, educa-
tion, and the environment-often are not considered. This is in a sense a "market
failure" in research and development, and some "intervention" may be necessary.
The most successful model for research and development for the benefit of
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Marshaling Technology for Development
the developing countries is the system of research laboratories of the Consultative
Group for International Agricultural Research (CGIAR). These laboratories, most
located in developing countries, specialize in corn and wheat (Mexico), rice
(Philippines and Liberia), forestry (Kenya and Indonesia), livestock (Ethiopia
and Kenya), insect physiology and ecology (Kenya), tropical grains and legumes
(Colombia and Nigeria), arid-zone agriculture (India and Syria), potatoes (Peru),
training (Netherlands), food policy (United States), and other areas of agricul-
tural research. Their successes stem from their concentration of scientific re-
sources, including the skills of researchers from all countries, on local problems
in the developing countries. Some of their weaknesses have been related to diffi-
culties in disseminating and communicating their findings. The lessons revealed
by several assessments of the CGIAR research network should be studied with
care before the model is copied or expanded.
Other areas that could benefit from regional centers of excellence in research
and development are: health research, with a concentration on vaccine develop-
ment, contraceptive technologies, and tropical diseases, as well as the capability
to track emerging diseases and drug resistance; energy research, with an empha-
sis on adapting renewable source technologies to local conditions; environmental
research, to understand and minimize the impact of agriculture on the tropical
environment; and education, with a focus on technologies for mass education in
poor countries. The new centers of excellence could be built on existing research
centers either national research institutes, which exist in many countries, or the
CGIAR research centers. They would offer professional training to developing
country researchers and an environment that would attract distinguished research-
ers from both developing and developed countries for limited stays. Research in
the social and behavioral sciences should be included in the programs of these
centers.
The proposed centers might differ from the centers of the CGIAR system,
established in the 1960s, by utilizing telecommunications and computer tech-
nologies to involve the private sector and a wide spectrum of scientists working
in their own laboratories. This different kind of international research network,
appropriate to the 1990s and into the next century, should be explored thoroughly
by the scientific and donor communities.
Many developing countries have been sending scientists, engineers, and other
professionals overseas for training for decades; China now has more Ph.D.s than
England, France, Germany, and Japan. Some say, however, that these developing
country professionals are not yet producing up to expectations. A similar situa-
tion occurred before World War II when the United States had more scientists
than Europe, but they too were not making a great impact. The war focused the
efforts of the Americans, and a radical but more benign upheaval might serve to
energize the scientific elites of the developing world in a similar way. The stimu-
lus could be provided by modern information-computer-telecommunications tech-
nology, coordinated by regional centers of excellence to give these scientists
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access to up-to-date technical information and publications and allow them to
communicate easily with their colleagues around the world. These scientists
might, then, provide the leadership needed to bring their countries into the tech-
nological mainstream.
INSTITUTIONAL ROLES
The developments suggested here will not come to pass unless all sectors of
the world community do their part. The challenge of marshaling technology for
development will require new roles for governments, the private sector, research
and scientific institutions, and the World Bank and the development community
at large. These new challenges are described in the rest of this chapter.
Governments
· Maintain awareness of the profound influence that technological changes
may have on the global economy. Initiate a planning process involving all social
sectors to create a vision of the country's role in a new global market and take
steps to implement that vision.
· Create a legal and economic policy framework that encourages innova-
tion and provides firms and individuals with the ability to respond to technical
change in an agile way. New technical and information-oriented institutions and
technical assistance programs, especially related to quality management, may be
vital. Provide incentives to the productive sector to respond to opportunities for
small, technically-oriented companies.
· Invest in the physical and technological infrastructure, especially commu-
nications and transport, needed to enable the productive sector to acquire and put
to use the most appropriate and effective technologies, seeking private sector
participation where possible.
· Bring technology to bear in the provision of public services, in particular
to reduce the cost and increase the quality and coverage of educational and health
services. Consider investments in new technologies for energy generation that are
more efficient and less polluting and in technologies for cleaning up the environ-
ment.
Private Sector
· Maintain awareness of technological advances in industry and acquire the
most effective production methods and products through research and develop-
ment, international agreements, joint ventures, and imported technology. Gain
the capability to access knowledge through international networks. Be aware of
quality management requirements in international markets and reorganize proce-
dures and facilities to achieve quality standards.
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.
Adopt organizational changes to better manage intellectual assets, invest
in innovative activity, and improve quality control. Because most technical change
comes from incremental innovations on the factory floor, be open to employee-
initiated changes.
· Recognize the importance of employee training to incorporating new tech-
nologies and converting knowledge to value. Be prepared to join forces with the
government and other private firms to leverage resources for employee training.
Scientific and Research Community
.
· Take a leading role in advising developing country governments and the
development community of new technologies and their implications for develop-
ing countries. Participate in information clearinghouses on the Intemet to assist
researchers and producers in developing countries.
Identify research priorities for regional and national research centers,
addressing the needs of developing countries. Assist and encourage research and
development on the local level to encourage the application and adaptation of
new technologies in specific developing country contexts.
Form partnerships with research institutions in developing countries and
encourage research partnerships across developing countries.
.
Development Community
· Put technology issues at the forefront of individual country development
assistance strategies. Help the least-developed countries adapt to the changes
brought on by the new telecommunications and computer technologies.
· Raise the awareness of developing country governments and other donors
of the opportunities and challenges offered by new technologies-for example,
by supporting seminars and studies on the implications of technological change
for developing countries.
Play a connector role, forging partnerships between developing countries
and the scientific and research community to increase access to knowledge and
apply it to developing country problems.
· Help to make information on technologies more widely and easily avail-
able to developing countries. Explore options for providing information facili-
ties for example, on energy and environmental technologies via networks such
as Intemet.
.
· Provide honest broker services, an advisory role that could be performed
in conjunction with national scientific academies or other scientific organiza-
tions, to assist governments to evaluate different technologies.
· Finance pilot or demonstration projects that apply new technologies in
specific developing country circumstances.
· Assist developing countries in managing the negative impacts of change
brought by the technology revolution.
Representative terms from entire chapter:
development community
