But it is difficult...

But it is difficult to understand how the strategy outlined in the conference report could be fairly accused of indifference to growth. The report contained numerous references to the need for growth as an essential and integral part of the basic needs strategy.

Redistribution with growth (emphasis added) was the aim. Some feared that the basic needs strategy emphasized consumption and redistribution at the expense of production and investment, that it rejected the use of efficient modern technologies, and that it would therefore sacrifice tomorrow's development for a small increase in welfare today. Others questioned the feasibility of the policies advocated. Still others felt that there might be a conflict between a basic-needs approach and the achievement of the objectives of a new international economic order.

But significant changes in development strategies and in development assistance to match them were already in the wind (US, 1980). A new kind of US foreign economic aid bill that sought to change the whole approach to development by concentrating directly on the problems of the poor was passed in 1973 (Howe, 1974). The president of the World Bank, Robert McNamara, pointed to 'the need to reorient development policies in order to provide a more equitable distribution of the benefits of economic growth'.

He outlined changes in Bank policy designed to help the small farmer and the rural poor and urged eradication of 'absolute poverty' by the end of the century in his address to the Bank's Board of Governors in Nairobi, Kenya in September 1973 (McNamara, 1973). And the annual report of the chairman of the Development Assistance Committee (DAC) of the OECD concluded that 'there has been a growing loss of confidence in the development strategy which was widely accepted in the 1960s which gave priority to GNP growth and the modern sector, leaving too many people in deep poverty' and supported a strategy of higher priority to food production and rural development (OECD, 1973).

And so it came to pass that many (but not all) development economists and practitioners came to accept that improving the lot of the poor was best done by attacking their basic problems directly rather than assuming that they would benefit eventually from a 'trickle down' of the benefits of overall economic growth and, most significantly, that enhancing social equity need not deter, and may even accelerate, overall economic growth (Grant, 1973).

After the arrival of President Charter in the White House in January 1977, the United States actively pursued a 'basic human needs' policy. Robert MacNamara was also converted to the 'basic needs' approach and the World Bank adopted 'redistribution of growth' as the 'signature concept' of its approach to poverty alleviation (Kapur et al., 1997, vol. 1, p. 263). But this support by the leading country and leading development institution and economists paradoxically made many developing countries suspicious.