Does Mr. Prachanda also have the spirit and determination to lead the impoverished Nepal and be the helmsman of 27 million Nepalese?
By Samyam Waglé
While the debate about the probability of miraculous economic success in Nepal under Maoists leadership is going on, they have not still come up with such strong convincing economic policies that would bring such dramatic turn allowing the three fold increase in GNP of the country in just a period of a decade.
No doubt that if it is possible, it is possible from capitalism and not socialism as Maoists believed and fought for. But they must have realized now after the failure of China under Mao and success under Deng which made them change their economic policy.
The noted economist Jeffrey D Sachs researched the effect of geography on economy and found that nearly all landlocked countries in the world are poor, except for a handful in Western and Central Europe like Austria, the Czech Republic, Hungary, Slovakia, and Switzerland which are deeply integrated into the regional European market, and connected by low – cost trade. Besides them all other land locked countries are poor because of geography that leads to high cost trade.
His famous research found that development surely seems to be favored among the temperate-zone economies, especially the subset that: (1) is in the Northern Hemisphere; (2) has avoided socialism; and (3) has avoided being ravaged by war. Tropical regions are hindered in development relative to temperate regions, probably because of higher disease burdens and limitations on agricultural productivity.
He further adds that coastal regions and regions linked to coasts by ocean-navigable waterways are strongly favored in development relative to the hinterlands. Landlocked economies may be particularly disadvantaged by their lack of access to the sea, even when they are no farther than the interior parts of coastal economies, for at least three reasons: (1) cross-border migration of labor is more difficult than internal migration; (2) infrastructure development across national borders is much more difficult to arrange that similar investments within a country; and (3) coastal economies may have military or economic incentives to impose costs on interior landlocked economies.
Leading thinkers have pointed out the four major areas in which geography will play a fundamental direct role in economic productivity. They are transport costs, human health, agricultural productivity and ownership of natural resources (including water, minerals, hydrocarbon deposits, etc.
Economists say it is the high transportation cost that inhibits the ability of landlocked countries to engage with the outside world to trade goods, exchange capital, and borrow ideas. Jeffrey Sachs also points out the burden of diseases on economic development. Tropical regions are more prone to diseases which have vital effect on economic growths. He even claims fertility decisions are affected by geography. Country like ours is still dependent on unscientific agricultural activities which again depend on monsoon rain.
Besides the fate of nations are shared by gift with valuable resources as Kuwait, Saudi Arab, Qatar, Arab are simply rich not because of their well governance but by natural gifs oil! Botswana is also the land-locked country but has diamond mines below them which makes them better! Second is about the neighbors. Some might blame god for not keeping us next to Finland, Canada or Liechtenstein! Though our neighbors are the rising superpowers, our instant neighbors are the Bihar in south and Tibet in north, both of which are the least developed states.
Even though geography plays significant role in the economic performance, it is not everything. The fact is proved by the success of South Korea but not North Korea and West Germany but not East Germany. They both share the same geography and climate, but due to the authority and policy, the fate of a nation takes turn. Even Burma, the country with potential resources and access to sea and once a better-off country now lags far behind in regards to everything after being mishandled by Junta military rulers. Thus in spite of every thing, leadership is also equally important as can be evidenced by the transformation of Singapore from 1960 to twenty first century, from third world to first under the leadership of Lee Kuan Yew. Does Mr. Prachanda also have the spirit and determination to lead the impoverished Nepal and be the helmsman of 27 million Nepalese?
It is thus better to focus to work around the geographical constraints by making shipping less relevant through lightweight manufactured and processed agricultural exports and can convert our perceived geographical liability into tourism and water wealth and other service-based industries. Maoist no longer can ignore foreign aids and western diplomacy but win the trust of their international critics and create sound atmosphere for foreign investments.
Even though the over optimistic economic plan of Maoists seems unrealistic with regards to geographic and resource constraints, it is rather better to have feasible goals as we can still do better by halving our illiteracy and infant mortality, better our roads, schools, hospitals, water supply, increase life expectancy and improve quality of life and so on. As most of the neighboring countries are rising economically, there is now no excuse for Nepal not to march with better economy even after its civil war is over and politics is fixed.
A funny hypothesis can be drawn that if only Prithivi Narayan Shah had got to read his contemporary Adam Smith’s “The Wealth of a Nation” or have understood the value of seas or water-carriages and its significant benefit on trade, market and industry, he wouldn’t have stopped his conquest in River Teesta but march all the way to claim the blue seas of Bengal and we might had different Nepal today!