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Pages from World Bank History: The Pearson Commission

 

A presentation of historical events by the World Bank Group Archives

July 11, 2003—In August 1968, Former Canadian Prime Minister Lester B. Pearson accepted an invitation from Robert S. McNamara, then President of the World Bank, to form a commission to review the previous 20 years of development assistance, assess the results, and make recommendations for the future. Pearson was a former diplomat and Nobel Peace Prize winner who had played an active role in UN affairs. On September 15, 1969, slightly more than a year after McNamara’s invitation, Pearson and seven colleagues on the Commission on International Development—which became known as the Pearson Commission—delivered their report, "Partners in Development."

The initiative for the Commission came from McNamara’s predecessor, George D. Woods. Amid concern about flagging enthusiasm among rich countries for making resources available for international development, Woods spoke to the Swedish Bankers’ Association in Stockholm on October 27, 1967. Referring to developing countries, he said, "The need is for exceptional action on a sufficient scale. The need is to launch a … movement in which growth feeds saving, saving generates more growth, and both together help two-thirds of humanity over the next two critical decades—critical because although population increase will only begin to slacken over the next 20 years, the groundwork can be laid for successful modernization and greater stability later on…

"We are ready at the World Bank, together with interested governments, to help to select and finance … a group of experts. I am ready to put at their disposal all the information and statistical material the Bank has accumulated and, if requested, to second staff to their service. Such a Grand Assize—judging the world’s record and prospects of growth—should in any case precede any attempt to round off our faltering Decade of Development with a genuine reformation of policy."

The work of the Pearson Commission was described by Peter M. Kilburn, a Commission Staff Assistant, in an article in the December 1969 issue of "International Bank Notes", from which the following is excerpted:

The major contribution of the report is undoubtedly the comprehensive view it takes of development as a complex of domestic and external factors (trade, aid, private investment), as well as the reasons it adduces in favour of enlarging present aid programs.

What was basically required of the Commission at its creation just over a year ago was that it elaborate an aid strategy based on a convincing rationale, that could be used to attack effectively the wariness of will so increasingly evident. For various reasons, some having to do with domestic problems and balance of payments difficulties, some relating to the public’s judgments about "waste and corruption", a number of the major donor countries were decreasing their foreign aid appropriations. In doing so, they were (and are) endangering the very viability of an international political idea that, until 1961, supported a rapidly increasing flow of concessional development finance from the richer to the poorer countries. In 1968, for the first time, there was a diminution in the total flow of official (government) aid. Who can doubt that if the large donors do not revive their aid programs, the debilitation will pass on down the line?

Because of this crisis in aid, the Commission decided that its report should be made available as early as possible. In fact, the whole operation was completed in eleven months. During that period, the full Commission met four times in order to direct the staff’s work, to make decisions about the argument and conclusions, and to write the report. Between meetings, the Chairman, accompanied by one or more members of the Commission, attended seven meetings on four continents (Santiago de Chile, Abidjan, Kampala, Rawalpindi, New Delhi, Singapore, Ankara), with representatives of the governments of some seventy less-developed countries. In a parallel series of visits to the capitals of the industrialized nations, Pearson discussed aid questions with officials of most of the DAC member governments. Apart from its reliance on the World Bank to meet its expenses, the Commission was in every way independent of the IBRD, just as its members were not representatives of their respective governments.

Having placed more than half a million miles of reservations on our behalf over an 11 month period, the Travel Office requires no reminders … that the Commission has now written finis to both its travels and its work.

The Commission of course investigated a wide variety of topics, including the volume and terms of aid, the debt burden of developing countries, technical assistance, trade, private investment, population, the structure of aid giving, etc., etc. Perhaps it would be useful to list here some of the major themes of the report.

The record of the past twenty years clearly shows that the economic development of the less-developed countries is feasible. In fact, in recent years more than 30 such nations have enjoyed growth rates higher than anything experienced by Western countries in comparable stages of their own growth.

Development assistance, it is also clear, has contributed significantly to this advance. Though the overwhelming proportion of growth has been due to the efforts of the less-developed countries themselves, the role of aid has been critical in such areas as savings and imports, and has provided an essential risk-absorber for industrial and agricultural enterprise.

If a rationale for aid can gain some support from the record, it remains that more compelling reasons must be adduced. There are at least two such. The first is a moral reason and is based on the universally accepted proposition that it is the duty of the fortunate to help those who need. Enlightened national interest, expressed in terms of an interdependent world community, is the second reason. It suggests the necessity for partnership. As the report asks, Who can now ask where his country will be in a few decades, without asking where the world will be?"

A much-increased flow of aid will be required if most developing countries are to aim for self-sustaining growth by the end of the century. This means specific aid targets, of which the Commission sets two: total aid should amount to 1 percent of GNP, and official aid, 0.70 percent of GNP by 1975.

Multilateral aid should constitute a growing proportion of the total flow of development assistance. Effective partnership requires that the actions of both sides be subject to scrutiny, and it is in the multilateral setting that this process is most likely to develop.

The fields of trade and private investment, although not substitutes for aid, must be understood by governments as essential parts of the development process. It is futile, for instance, to nullify the effects of increased aid by inconsiderate trade policies.

Beyond the specific recommendations of "Partners in Development", beyond the lists of problems and the proofs of progress, there lies the all-embracing theme of "World Community", which appears as clear in print as it is hazy in practice. But without such a vision, the practice of international cooperation for development is in danger of frittering itself into a pittance of conscience money.

Now that the work of the Commission has been completed, the support staff of about 30 has dispersed from the offices furnished for them at 1900 L Street. A number on secondment from their permanent positions in various countries have now returned to their regular work. Some others hired especially for the Commission have transferred to permanent work in the Bank and a few others lent from the Bank to the Commission on a temporary basis have also returned to regular full-time duties with the Bank.

Copies of the report are available in the Bank’s Joint, Fiscal, and Translation and Interpretation Services Libraries, as well as the Sectoral and IT Resource Center.

Without records there is no history. Courtesy of ISG’s World Bank Group Archives.

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Lester B. Pearson

 

 


First meeting of the Pearson Commission. Left to right: Roberto de Oliveira Campos (Brazil), Douglas Dillon (United States), Saburo Okita (Japan), Sir W. Arthur Lewis (St. Lucia), Rt. Hon. Lester B. Pearson (Canada), Rt. Hon. Sir Edward Boyle (U.K.), Robert Ernest Marjolin (France), and Wilfried Guth (Germany).

 

 


Members of the Pearson Commission with Pope Paul VI (center, in white).

 

 



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