GUEST EDITORIAL Drawing on Experience: Transforming Fragile States into Effective Ones

When the World Bank was founded almost 65 years ago, financing the reconstruction of Europe and Japan after the Second World War was its defining purpose. Now, with World Bank-supported programs in countries such as Afghanistan, Democratic Republic of Congo, Iraq, Lebanon, Liberia, Sierra Leone, the Solomon Islands, Sudan, Timor Leste, and West Bank/Gaza, rebuilding from the ruins of conflict is once again high on the Bank’s agenda. Indeed, fragility and conflict are among the institution’s six strategic directions.

This concern with fragility and conflict emerges, in part, from the Bank’s mission to fight poverty. Poverty, fragility and conflict are, in many countries, elements of a vicious circle; to break it, all three must be addressed. After conflicts have ended—and, in many cases, even as they rage on—the international community has called on the World Bank and other development institutions to support reconstruction. While this is necessary, of course, a better option would be for these institutions to become engaged to prevent fragility from degenerating into conflict in the first place.

The cost of conflict is high. Aside from the lives lost and damaged due to conflict, and the scale of human suffering it creates, with women most often carrying the brunt of it, conflict also destroys assets and institutions. Recovering and rebuilding them can take many years. As economist Paul Collier, author of The Bottom Billion and Wars, Guns and Votes—among others—has shown, civil conflict often spills across borders. Conflict thus not only undermines and slows down development and poverty reduction in the country where it finds a host, but also in that country’s neighbors. It provokes and sustains movements of refugees and displaced persons, crime, disease, narcotics and extremist violence, in the region and sometimes beyond.

Given the complexities of fragility and conflict, the World Bank’s approach to addressing them is constantly evolving in the light of experience. In postwar Europe and Japan, the focus was on rebuilding damaged assets. While the devastation was huge, the countries in question were, for the most part, already industrialized, with many established, recoverable institutions, as well as skilled populations. In low-income countries coming out of prolonged insurgency, however, the challenge goes beyond fixing broken infrastructure. It often entails nothing less than building a sustainable state.

Securing development
 

Increasingly, rebuilding and development is taking place amid ongoing conflict. With chronic wars, widespread use of terrorist tactics, and on-again off-again violence, the humanitarian space that once allowed international actors to provide support, has shrunk. On the positive side, our understanding of the role of the state in building peace and laying the foundations for development has deepened. The example of countries that have achieved reductions in poverty, however modest, suggests that development depends on an effective state that delivers core services such as security, rule of law, and public goods such as control of contagious disease.

Countries at the end of conflict often do not have an effective state. They need help to build one, but this is a huge and enormously complex task. Experience has taught us that it requires integration of security, diplomatic and development support. This is challenging enough when a single donor seeks to achieve it through a “whole of government approach.” It is all the more complicated when numerous international actors with different mandates and capacities are involved. As World Bank President Robert B. Zoellick said recently,

“This is not security as usual or development as usual. Nor is this about what we have come to think of as peace building or peacekeeping. This is about ‘Securing Development’—bringing security and development together first to smooth the transition from conflict to peace and then to embed stability so that development can take hold over a decade and beyond. Only by securing development can we put down roots deep enough to break the cycle of fragility and violence.” ¹

Securing development depends on building an effective state. What constitutes an effective state? One useful way of defining it is offered by several OECD countries: an effective state has both the capacity and willingness to mobilize resources, exercise political power, control its territory, manage the economy, implement policy, and promote human welfare in an inclusive manner, including delivery of vital services such as justice and security, health care, education, water and sanitation.

State-building

State-building is about creating institutions that are effective in the eyes of their beneficiaries, and which can be self-sustaining within a reasonable timeframe. Indeed, state-building includes “capacity building” but goes further. It is about governments deciding on the scope of services they will provide—and a government short of educated people, money and a tradition of good governance cannot be too ambitious—as well as how those services should be delivered, drawing on capacity that already exists, including that found in humanitarian agencies and NGOs. It is about how to structure government, how to align organizations to achieve desired results, and how to establish rules for efficiency and accountability without bureaucracy. It is about people, and includes nurturing the skills that exist, providing training, selecting on the basis of merit, and rewarding performance. It also involves providing space for learning by doing, while expanding the supply of skills for the long term, by revitalizing the education system, particularly at higher levels.

Building a state also involves creating the “plumbing” of administration, that is, establishing systems to manage public finances and human resources. Most importantly, it is about providing incentives and delivering accountability, giving voice to citizens, providing checks and balances for performance and against abuse of power, developing centers of countervailing power like legislatures, judiciary and commissions with independence for audits, stamping out corruption, and transparent elections.

An organization like the World Bank can assist countries by laying out solid technocratic advice on best practices in state-building. But the reality on the ground is more complicated and often messier. Max Weber’s definition of a state as having a legitimate monopoly of violence, the concept of merit-based bureaucracy, and the state’s role in establishing conditions for competitive markets are all useful principles and guidelines. But their application is not always easy in situations dominated by warlords, ethnic divisions, traditional hierarchies, patrimonial systems, and business people who are often profiting amidst the violence and lawlessness of a wartime economy. To improve the state’s effectiveness under such conditions, practitioners must draw on local traditions, take into account political conditions and find the support that local political leaders can muster. The international community can help, but the basic design, speed and direction of reform, and the amount of change that a society can accept must be determined by the country itself.

What can outsiders do?

While we have learned much about helping countries rebuild after conflict, we know less on how to address fragility or to help societies prevent war. Recent academic work has presented fragility in terms of deteriorating legitimacy, a widening gap between the rules that government sets and what society will accept. A government may be regarded as legitimate by its people if it sets rules and laws that are socially acceptable, delivers services effectively, and is consonant with the combination of traditions, myth, religion, history and identity that defines the nation. How can development institutions understand this process of legitimacy more deeply, especially when legitimacy may be grounded in traditional hierarchies or charismatic leaders, and develop differentiated modes of engagement? How do we avoid political interference and violating the “do no harm” principle? Understanding how development assistance contributes to statebuilding and reinforces legitimate authority, even whether assistance designed to support statebuilding is seen as legitimate itself, are important areas that require future exploration to help us address the difficult challenges of providing effective assistance in situations of fragility.

Academic research, combined with the work of the OECD DAC International Network on Conflict and Fragility, among others, has produced draft guidelines for those helping countries secure peace and build an effective state. The OECD principle in which those who seek to assist, must seek first to “do no harm,” may appear self-evident. But applying this principle is often challenging: it presupposes a deep understanding of the political context, and precludes creating parallel delivery structures that undermine the nascent state. It requires that outside helpers focus on building core state functions such as personal security of the population, and on establishing the centrality of the government budget for priority-setting. It also means promoting a vibrant and law-abiding private sector that creates jobs. All of these efforts must be supported by staff members on the ground who understand the country, and have the latitude to take decisions quickly enough to respond effectively to changing conditions.

The record of technical assistance in these situations has been mixed. Indeed, Serge Michailof, formerly of the World Bank, has coined the “paradox of technical assistance”: being that those organizations in most need of technical assistance are least able to absorb it. In seeking to build capacity in a fragile state, a comprehensive approach, predicated on realistic goals and expectations, is essential. It must include multiple strategies to address skills gaps, including recruitment of skilled national staff from diasporas, training of existing staff, and development of tertiary education facilities in the country. But it must also take stock of the government’s initial condition, and provide guidance as to the scope of services the government is able to provide and deliver itself, as well as those it needs to contract out for delivery by third parties.

Comprehensive, but sequenced

Building capacity usually depends on a reform of public administration, at least in the departments responsible for core services; such reform must strengthen incentives, organization, staffing and accountability. Implementing this kind of reform across the entire public administration is typically complex and slow. In Afghanistan, for example, an incremental approach was adopted to reform key ministries, or departments within ministries, where there was committed leadership and ownership. Staff were appointed to redefined positions on merit and paid higher compensation. Complementing these reforms was a program of technical assistance in which individual experts, often from the diaspora, were contracted to help establish financial management and human resources systems, and to provide training for existing employees.

While such incremental approaches offer advantages, they also present challenges. Returning diaspora members are sometimes resented for having been abroad during the conflict, only to return to a senior position after it. Some existing staff members may not have the needed skills to do their jobs; in some cases, former combatants have been appointed for patronage reasons, and have neither the knowledge nor the vocation to contribute to a transparent and effective administration.

Capacity building requires patience and persistence, and pragmatic interventions that deliver some short-term state effectiveness while laying a solid foundation for the future. Institutions are created through “learning by doing,” that is, accepting accountability for delivery and finding ways to overcome the problems that arise along the way.

It is sometimes tempting for the international community to jump in and deliver services itself, bypassing legitimate national authorities. This not only prevents state organizations from learning from their mistakes, it can hollow them out as accountability for delivery shifts to donors and as the best staff are attracted to work for parallel donor programs.

Capacity building is at the heart of state-building which in turn is linked to building peace and creating the conditions that lead to sustained reductions in poverty. Outside organizations like the World Bank can help, but ultimately, countries—even those whose states are fragile—have to build their own institutions, and tailor them to their own needs.

Alastair McKechnie is Director of the Fragile and Conflict-Affected Countries Group at the World Bank Group.

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Capacity building is at the heart of state-building, which in turn is linked to building peace and creating the conditions that lead to sustained reductions in poverty.