Technological neglect traps poorest nations in poverty: UNCTAD

July 21, 2007 - 0:0

GENEVA (AFP) -- The world's poorest countries are being sapped of the technological capacity they need to break out of the poverty trap and catch up with the rest of the world, the UN's trade and development agency said.

The UN Conference on Trade and Development argued in its annual report on Least Developed Countries that science, technology and innovation were not luxuries for the world's poorest, but necessities that would allow them to leapfrog into the 21st century. ""We do not see the real mainstreaming of technological policies in the poverty reduction strategies,"" UNCTAD Director General Supachai Panitchpakdi told journalists. Supachai said the 50 LDCs also needed to build the right environment for technological development, which would encourage investment in education and infrastructure and allow them ""to break loose from their poverty trap."" Only some of the Asian LDCs - Bangladesh, Cambodia and Laos -- were showing signs of taking that path, he added. The report painted a critical picture of governments in the poorest countries, wealthy nations providing aid, as well as commodity-hungry foreign companies, saying they underestimated or neglected the value of technological development in LDCs. Foreign aid and investment flows are not building sufficient technical know-how, infrastructure or innovative business that would enable the poorest countries to develop independently and create jobs in the longer term, it said. Between 2003 and 2005, about 1.3 billion dollars in official development aid was devoted to governance or social issues in the poorest countries, while just 12 million was spent on agricultural technology that could strengthen crops and food production, according to UNCTAD. ""We're not just arguing for a rebalancing of aid, but also for an increase in aid,"" said one of the report's authors, Zelijka Kozul-Wright. ""We're calling for a doubling of aid."" Foreign Direct Investment by private companies was often focused on mining and oil industries or commodities, especially in Africa, producing little in the way of durable technology transfer into the poorest economies. Total investment inflows into African LDCs rose fourfold from an annual average of 1.7 billion dollars in the 1990s to 6.8 billion dollars in 2000 to 2005, partly due to the worldwide race for commodities and energy resources, UNCTAD said. The report said market forces were having a ""very limited"" impact on technological development in the poorest countries, ""despite the high degree of exposure of LDCs to international trade and capital flows."" They also fare far worse than their slightly wealthier counterparts in developing nations, the report found. Other developing nations import 12 times as many capital goods -- which can be used to boost domestic technological capacity -- than LDCs, it said. Government policies encouraging technology and innovation are also lacking in the poorest countries, while emigration is also sapping their limited home-bred skilled workforce, UNCTAD said. The report found that one million of the 6.6 million people in LDCs with higher education were working in industrialized nations. Twelve of the world's poorest nations have also lost more than one third of their skilled professionals, according to UNCTAD. Kozul-Wright highlighted the example of South Korea's technologically inspired path to growth. ""I remember the 1960s, when Korea had a lower per capita income than Ghana and the World Bank was saying the Koreans were lazy, incompetent and corrupt, they won't be able to do anything.