Taking bets on development

Pacific Reflections By Gabriel McCoard

Guam is the capital of Micronesia.

That’s hardly a unique observation.

Whatever you want to call the reason—Great Power Geopolitical Play, Trappings of Empire, Expansionism, Injustice—the simple fact remains that Guam is the economic and social anchor of Micronesia.

This is in spite of, or perhaps because of, America’s Pacific backyard perimeter cutting right through the freely associated states’ jurisdictions and their open travel rights.

I don’t travel much these days. My 10-year visa to China will expire before I can squeeze out one more trip. I suppose it’s fitting since it’s within an expired passport. Over the past few years, the closest thing I’ve come to a junket is an annual update session set in a suburban hotel.

Wait, did I just say junket out loud? Pardon me, I meant training conference.

There is an emerging school of skepticism over the well-heeled heading global agencies and spending inordinate percentages of their budgets on travel. I’m sure I’m not the only one who’s heard stories about hospitals that can’t run vital equipment because the budget is spent on executive travel, or the courts that languish while judges attend judicial development and case management conferences.

My own gripes about travel are simply the most visible elements of an international development industry that remains desperately needed and in desperate need of a policy reset.

Donald Trump’s MAGA world has introduced a parallel school of skepticism over the fundamental purpose of development or whether anyone should care about the not-well-off.

On many fronts, development is undergoing such a change. In the wake of wealthy countries cutting back on aid commitments, there is a new focus on greater interaction between less wealthy nations. Such movements are not new.

Think of the Bandung Conference and Non-aligned Movements during the Cold War, whereby nations said they would not follow either the U.S. or Soviet Union. Think also of the whole notion of “Third World” and the many organizations across Africa and South America that emerged following independence. 

Foreign Policy magazine, for one, devoted its fall edition to what it called “The End of Development.” Among its themes were increased cooperation among the emerging small- to medium-sized economies and the role of China as a game changer.  

I have said numerous times that an economy cannot be imported, but I continue to see at least glimmers of optimism on the economic improvement front.

A recent edition of the Pacific News Agency Service contained a piece out of the Solomon Islands, titled “Value-added products to open new income streams for rural households.” Its gist was to orient food producers and farmers toward products with longer shelf-life, which are more valuable than raw materials. For example, fruit jams instead of raw fruit, or cassava flour marketed toward gluten-free consumers instead of raw roots. That kind of thing—items with a higher profit margin.

Nations that, over the past few generations, went from poor to wealthy share certain traits. Many used commodities to fund full industrialization. Growing cotton created the material for textiles. Exporting those textiles brought in money. The profits then funded other industries that grew the economy and employed more people, creating a broader tax base, which, in turn, allowed for services like comprehensive health care.

I previously proposed small-scale projects, like creating emergency medical services in the island, funded and staffed locally. The idea is similar: use local resources to address local problems and, hopefully, generate some economic activity in return. A modest proposal.

Perhaps the most significant development reset has been an acknowledgement that sustainable development needs to be internal. A nation must make a conscious policy choice to improve the lives of its citizens, and then complete the last-mile link between that high-level policy and improving the lives of ordinary people.

The islands have limited resources. The land base is limited, minerals are scant—at least those easily extracted—and tourism only gets you so far. Local self-interest—you could say corruption—tends to get in the way of, say, tuna exports as national revenue to fund other endeavors that could ultimately replace aid or high-interest loans.

Palau, under current conditions, might be able to develop a Monaco-type economy by catering to a global elite, but its neighbors would likely be left behind.

Until the fledgling republics decide to concretely improve the lives of their citizens, Guam will continue to be the “capital” of Micronesia.

Gabriel McCoard is an attorney who previously worked in Palau and Chuuk State. Send feedback to gabrieljmccoard@hotmail.com.

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