MFFT 1053

1. MOHAMAD NOOWAWI MD YASIN MFF1410062. MOHD HASAN MOHD SAAID MFF1410033. WAN AHMAD JAMALUDDIN BIN W MOHAMAD MFF141007

• The five kinds of freedoms associated with sustainable development are: (1) political freedoms;

(2) economic facilities; (3) social opportunities; (4) transparency guarantees;(5) protective security.

• Chose ONE freedom in your opinion that is the most critical for a successful sustainable development and elaborate your choice

Question

Institutional And Instrumental Freedoms

• Five distinct freedom seen in as ‘instrumental’ perspective, are particularly investigated in the empirical studies that follow

• These includes:

a) Political freedomsb) Economic facilitiesc) Social opportunitiesd) Transparency guaranteese) Protective security

Development as Freedom is a book by economist Amartya Sen, published in 1999!!

• They are like the five equally important sides of a box in which urban investments can be contained. Success is measured by the degree to which obstructions are removed and each has to be tackled in the development process.

• In other words, development will inevitably get distorted if only one or two of these objectives are given a priority by using the argument that some of the freedoms can come afterwards.

Political Freedoms

Social Opportunities

TransparencyGuarantees

Economic Facilities

ProtectiveSecurity

All five instruments are interconnected and equally important!!

Institutional And Instrumental Freedoms

Sustainable Development Elements

Economy

Environment

Social

Sustainable development entails three sets of interrelated objectives !!

What is Transparency !!

Definition

• The perceived quality of intentionally shared information from a sender• Implies openness, communication, and accountability• Classically defined as when "much is known by many“• Concept of removing all barriers to —and the facilitating of— free and easy public access to corporate

information and the laws, rules, social connivance and processes that facilitate and protect those individuals and corporations that freely join, develop, and improve the process

Economy (1/4)

Transparent decision making is critical for the private sector !!

• Transparency is an important aspect of good governance, and transparent decision making is critical for the private sector to make sound decisions and investments. Accountability and the rule of law require openness and good information so higher levels of administration, external reviewers and the general public can verify performance and compliance to law

• Current TPPA negotiation is one of the examples of in-transparency of government in doing the economic negotiation

Developed Countries Developing Countries

• Ironically, agricultural subsidies, which is the main trade-distorting practice of developed countries like the US, have been kept out of the agenda of the TPPA or other FTAs involving Europe

• Open up Govt. procurement, with foreigners allowed to bid on similar terms as locals for goods, services and projects of the federal government

• Tariff-free imports from other TPP countries which may lead to loss of market share or closure of some sectors

• Thus the developing countries are deprived of what would have been the major trade gain for them

• TPPA countries have agreed to allow foreign companies to sue governments in an international arbitration tribunal

• Existing preferences in government procurement for local companies will be affected

Economy (2/4)

Transparent decision making is critical for the private sector !!

• Without transparency, it will left room for speculation and uncertainty for country’s economy

Economy (3/4)

Conservative approach to such measurement gives an estimate for annual worldwide bribery of about US 1 trillion dollars*

• Economic downturn are also the effect the in-transparent of doing business• Such as in-transparent in awarding contract (bribery, favoritism, corruption)• In the construction industry, project costs typically increase by more than 25 per cent as a

result of corruption. Similar mark-ups have been reported in the defense and finance sectors

• Overpriced and poorly planned projects increase unsustainable nation debt• Corruption deprives countries of finance for development

– Multilateral Development Banks estimate that some $400 billion has been looted from African states and stashed in foreign bank accounts, around $140 billion from Nigeria alone. The African Unions estimates the $148 billion a year leaves the continent because of corruption, and 80-90 per cent of the illicit overflows never return to the continent. Between $20-40 billion of corrupt money is estimated to flow from transition and developing countries into Western banks annually

* Source: World Bank 2004

“Corruption can add between 20 per cent and 100 per cent to the procurement of government goods and services. Overall corruption-related losses can total more than a country's foreign debt”

Asian Development Bank

Economy (4/4)

Data transparency !!

• To ensure competitiveness of the country, Malaysia need transparency in data and measurement to compete with others country

* Source: The World Bank

Social (1/5)

Corruption [is] among the greatest obstacles to economic and social development* !!

• Corruption and bribery are not victimless crimes. They hit the poorest people hardest and undermines economic development

• Poor people are the worst affected by corruption• Such 'leakage' leads to aid 'disappearing' before it reaches the poor• Will lead to income inequality/disparity and social gaps• Example :

– Wealthy urban elites can lobby the government to bias social expenditure toward higher education and tertiary health, which tend to benefit high-income groups

– Corruption can affect the targeting of social programs to the truly needy. The use of government-funded programs to extend benefits to relatively wealthy population groups, or the syphoning of funds from poverty-alleviation programs by well-connected individuals, will diminish the impact of social programs on income distribution and poverty

* Source: The World Bank

Social (2/5)

Freedom of information – key of social development !!

• Free access to information is not only elementary to the right of freedom of expression but also fundamental to the exercise and realization of numerous social and economic human rights

• It is for people to be knowledgeable about the way their countries are run, about their own rights and to enable them to participate in shaping policies and politics, they require publicly held information

• Such information affect their lives and with it they can demand change and effectuate improvement

• Freedom of information is thus the prerequisite for people’s effective participation in the political, social and economic affairs of their countries and directly benefits socioeconomic development and the efficiency of government

Social (3/5)

Freedom of information – key of social development !!

• Speculation and price of services and goods are related. People tend to buy goods base on their ‘concern/ worry’

• Transparency guarantees of safety net in the case of GST implementation• “Rakyat” feedback to Government’s policy (increase of good price, implementation of BRIM,

etc.)

Social (4/5)

Freedom of information – key of social development !!

• Public need to know how government spend their money and its effect on government’s financial

• Government overspending could create country instability & unrest

* Source: The World Bank

Social (5/5)

Freedom of information – key of social development !!

• Transparency in data information delivered by government is crucial in ensuring social stability• The rise of social media and sharing information, Government need to publish fast and reliable

information• Public perception toward government in providing ‘rakyat’ with good information and managing crisis

especially thru social media important for peace and harmony• In the crisis event, transparency ensure government’s delivery reach ‘rakyat’

Environment (1/4)

Transparency in decision-making as an important principle for effective environmental impact assessment!!

• Transparency regulations have become an increasingly popular tool globally and in range of issue areas, from the environment to anti-corruption and service delivery

• Require government to disclose information on– Environmental law, regulations and standards– Allocation of emission quotas and permits– Pollution fees and penalty collected– Exemptions, reductions or postponement granted– Outcomes of investigations into public complaints– List of violators of environment regulations

Environment (2/4)

Transparency on Environment Issue !!

• People need transparency data on environment to be part of effort in climate change

• Data change how people react on environmental issues

• Lynas issues raise concern among Malaysian whether it is safe or harzardeous

Air Pollution Index (API)

Environment (3/4)

Sample of Cases !!

• On August 1, Putrajaya and the Selangor state government signed the Heads Of Agreement on restructuring the water supply industry, paving the way for a long-term solution to the water issue in the state

• Signing the agreement in the midst of a change in administration could lead to questions of moral and legal legitimacy, especially since there has hardly been any openness and transparency in the negotiations so far

• The deal saw hefty payouts to the water concessionaires in Selangor and Santiago called on Putrajaya to postpone the signing of the final agreement on the water restructuring exercise in Selangor

• Due to that, the prolonged water crisis in Selangor not just affecting the environment, but also the economy and social

Case 1

Environment (4/4)

Sample of Cases !!

• Given China’s decentralized administrative structure, environmental disclosure ends up being weakest in the most polluted cities

• Environment ministry’s enforcement costs remain high. Local government behavior depends on their economic priorities and the nature of their relations with enterprises. Chinese enterprise behavior depends on the character of their relations with government and Multinational companies

• Provided China’s authoritarian structure, improved governance does not translate into stronger accountability, challenging common assumptions about the relationship between transparency and accountability

Case 2

Conclusion ?? Recommendation ??

Government need transparency guarantees to ensure Sustainable

Development

Social Economy Environment

Thank you!