The economic importance of the UN

I shudder to admit it, but there is some benefit to the UN being in Sudan – and that is to prop up a feeble economy. For, despite heavy Chinese investment and not inconsequential oil revenues, the economy in Sudan remains structurally flawed, largely because of its over-reliance on a few basic commodities that can not be relied on for price. The Sudanese government are doing their best to change this, but it will take a while before things substantially change.

The advantages of having the UN in the country surfaced during a conversation I was having today with an athropologist, who happened to be looking at development in the country.

I was giving my usual cynical spiel about the UN and NGOs working in this country, when he suggested that the main benefit of having the UN in the country is redistribution of wealth and circulation of money in the economy.

A noble cause, perhaps, but such an argument overlooks two crucial points.

Firstly, where is the money going? This is a completely abstract, theoretical and philosophical argument that cannot be conclusively proved one way or the other. Of course, it is quite certain that the majority UN workers are spending most of their bucks at international places like Solitaire and Amarat, rather than on a plate of fuul down the market. But one should not ignore the filtering-down effect. The owners of Solitaire or Amarat pay the wages of their Sudanese workers, who then take the money back to their family, who spend it on bread from the local baker… It is quite impossible to tell how much money is going where.

The second point can best be illustrated, as I did, by drawing a parallel between the UN as an economic power and the London or New York Stock Exchange. When stocks and shares were first thought of, the idea was to allow a company to raise capital quickly, by giving away part of its business. This noble notion rapidly grew into something much bigger, as investors and speculators sought to make rapid money through buying and selling shares. This of course redistributes the wealth, but, as the past year has shown, all this abstract productless investment is not necessarily a good idea.

The same goes for the UN as an economic force in Sudan. Sure it is redistributing the wealth, but it would be far better to give the money to a local woman making jallibias in the market, rather than filter the investment through many layers of bureacracy, none of which are contributing real goods to the marketplace. The difficulty is how this can be done on a large enough scale to make a real difference.

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One Response to “The economic importance of the UN”

  1. sudaneseoptimist Says:

    “Sure it is redistributing the wealth, but it would be far better to give the money to a local woman making jallibias in the market, rather than filter the investment through many layers of bureaucracy, none of which are contributing real goods to the marketplace.”

    One way to help the situation is through microfinance. Sure it may not encompass or solve all the economic problem the average man on the street in Sudan is facing, but it is a great way to stimulate an economy from the bottom-up. I am huge fan of microfinance and truly do believe that it yields great results. Have you heard of Kiva? If not, check out their efforts at kiva.org. It would be great to see philanthropists focus on microfinance and such rather than donate money blindly without knowing–or wanting know– who’s the end beneficiary.

    Optimist

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