Economic growth is basically defined as an increase of wealth of a nation over time.

Development meanwhile can be described as a social condition within a nation in which the authentic needs of its population are satisfied by the rational and sustainable use of natural resources and systems. Economic growth and development are closely intertwined. In fact, economic growth is but a step in the direction towards development – one of prime significance, indeed a precondition to it, but by no means can it be conceptualized as development itself. For a country to be generally recognized as a developed one, it also needs to be able to provide its citizens with as fair as it is possible a distribution of basic resources and social amenities, such as healthcare and education.

The Gross National Product (GDP) is the primary indicator for measuring economic growth. GDP represents the total value-added in production of goods and services in a year, while GDP per-capita is the economy-wide average. The major draw-back is that GDP leaves out/does not deduct figures associated with environmental consumption/damage, the informal sector and other social costs of economic growth. Linking this to development, it is noteworthy that neither income nor expenditure measures the wellbeing people obtain from goods and services. Thus, GDP, a purely economic indicator, falls short of providing a true picture of a country’s development or lack of it.

The concept of development spans far and beyond the realms of economic wellbeing of individuals. For instance politics, human rights, education and cultural conditions are all social variables that influence development. Thus, based largely on the comparison between GDP and the Human Development Index (HDI), it is argued that growth and development, though interrelated, are actually two different phenomena.

With the widening gap between the rich and the poor, available facts indicate that, regrettably, development in Uganda cannot be an inevitable and automatic consequence of economic growth. For instance, in any typical agrarian economy, as industrialists make more money and acquire more means of production such as land, the livelihood of farmers who previously depended on that land for agriculture is likely be affected. As the net worth of capitalists like Sudhir Ruparelia and Madhvani grows, so does the GDP as well as the GDP per capita – yet the GDP growth may be attributed to just a handful of the rich.

It can therefore be deduced that economic growth improves the situation of those who have been relatively well-off anyway, while it does not help, if not adversely affects, the poorest and the most vulnerable members of the community. As for the majority of the population, more often than not, even the little they have may be taken away and are left impoverished – an obvious step backwards into underdevelopment rather than one towards development. Uneven distribution of benefits of such growth among the country’s citizens implies growth does not directly translate into development.

The issue of how the market perceives risk is a major stumbling block to furthering development, even where there is economic growth (Busharizi 2012). The market is unlikely to invest in the social services, which investments have a long repayment period and are therefore more risky in the eye of private capital. For instance, the market may not be able to discern a potential return in setting up a borehole in a village or providing education free of charge or providing free mosquito nets to a community. But it is these social services that give more people a chance to climb up the social ladder by being more productive persons.

Economic growth for a developing country like Uganda often falls short of translating into development owing to the crooked nature of prioritization. For instance, instead of being earmarked for education and healthcare, there is enormous evidence pointing to the fact that an increase in budgetary revenue has all too often been spent on arms or spent on administrative costs.

In Uganda’s case, governance (leadership, public engagement and participation) is another crucial factor that has jeopardized the prospect of economic growth ever equaling to development. This is precisely so because poor governance is synonymous with fiscal indiscipline, poor prioritization and worse still that endemic cancer- aggravated corruption. Uganda’s revenue envelope has been increasing over the years thanks to economic growth, offering government the economic leverage to increase budgetary allocations to line ministries for infrastructure development and social welfare services. The budgetary allocations however, amount to nothing if the same monies are swindled with impunity as has repeatedly been the case. Thus, the increased revenues notwithstanding, the precarious situation of the service delivery stagnates at its usual pathetic shape. Indeed, the actual income of a country is of relatively lesser importance when compared to the way in which this relative wealth translates into the quality of services the state renders to its citizens.

Another concern is the environmental sustainability of development that economic growth ushers. All too often we have had new investors erecting factories in wetlands or destroying forest to plant sugarcane, much to detriment of our environmental. According to ‘Our Common Future’ (1987) definition of sustainable development, clearly, this kind of development may meet the needs of the present by creating jobs, but the associated impact such as climate change, soil erosion and global warming also compromises the needs of the future generations.

In the words of Seabrook (1993) “All over the world, more and more people are being disadvantaged by a version of development which, even if it creates wealth, leaves them with a sense of loss and impoverishment”. Uganda is no exception to this conceptualization. In fact, already the pinch is being felt in form of floods destroying life and property for residents of Kampala suburbs such as Bwaise and other areas where drainage channels have been blocked as a result of the so called “development” i.e. constructing shopping malls and factories on wetlands without planning for alternative drainage channels.

Instability very much affects human development prospects. Peace, good regulations, investment climate contribute to development. Conversely, a reduction in income levels of the majority and inflation are factors that may potentially lead to instability. Generally, government’s behavior can either be a stabilizing or destabilizing factor. Public discontent can also lead to instability, which instead poses dire consequences for both economic growth and development.

As a country with high fertility rate, the rapidly growing population means available resources, including social services becomes insufficient compared to the swelling population. The associated problems like hunger, traffic congestion undermines the standards of living of citizens, more so for the poor. The population increase is not just a statistical figure, they represent more mouths to feed, more bills to pay etc. To the government, this necessitates building new schools and hospitals or expanding existing ones to cater for the population increase.

As studies on “Growth without Development” and “Development without growth” suggests, growth alone is itself not sufficient, which is why despite its comparatively poor economic performance, Bangladesh has made relatively greater progress in terms of its social development than Pakistan.

References:

1. Seabrook, Jeremy (1993) Victims of Development. Resistance and Alternatives. London, New York: Verso.

2. Storey, Andy (2003) “Measuring Development”, in McCann, Gerard and Stephen McCloskey (eds.) (2003) From the Local to the Global. Key Issues in Development Studies.  London, Starling: Pluto Press.

3. Todaro, Michael P., Stephen C. Smith (2006) Economic Development. Harlow: Pearson Education Limited.

4. Busharizi, Paul (2012) The Role of Private Sector in Development. The Guide. Published by ACTADE and Konrad Adenauer Stifftung, Uganda Office.

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