Tag: economy

Before the transition, building resilience

Mohamed Tounba, a major general and Minister of the Interior since the coup d’état carried out by the junta of the National Council for the Defense of the Fatherland (CNDP), which overthrew elected President Mohamed Bazoum on February 8, 2023

Light summer reading — the other day I picked up “D’or et de jungle” (roughly, “Of Gold and Jungle”) by Jean-Christophe Rufin, bought at the train station. The book tells the story of the preparation and execution of a coup d’état in Brunei, a wealthy Southeast Asian sultanate. Beneath the plot, the book also offers a reflection on the destabilization of societies and the resilience of states.

The coup imagined by Rufin doesn’t primarily rely on direct military action or the brutal seizure of institutions. That phase exists, but it’s only the final step in the process. As is often the case, most of the work consists of preparing the ground: making a society receptive to upheaval, weakening its political and societal defenses, polarizing relationships, blurring points of reference, undermining trust — and thereby creating the conditions in which a series of seemingly unrelated events makes a change of regime inevitable. No event occurs except because its environment allows it.

Applied to a coup d’état, this chain of events pursues a precise political goal. Before overthrowing a government, one must first shake the system in which it operates. But this erosion of the foundations of society, the economy, and institutions can also happen without any overarching plan — almost without our noticing.

It’s the level of resilience that defines the crisis

This is precisely what makes resilience so important. Resilience is not a permanent state but an evolving property of political, economic, and societal systems. A state can appear solid while gradually losing the capacities that allow it to withstand a combination or succession of shocks. Yet contemporary crises don’t arise from isolated shocks followed by a return to normal. Health, security, economic, and climate shocks intertwine in their effects. They form systems of crises in which each shock changes the conditions under which the next one occurs.

The Covid pandemic, for example, structurally transformed global supply chains, increased the debt burden of many countries, and profoundly eroded trust between citizens and governments. None of these developments had returned to a prior state before the impact of the war in Ukraine, and then the current energy crisis, further intensified them.

What distinguishes an incident from a crisis, then, is not just the intensity of the shock. It’s also the ability of states and societies to absorb it, contain tensions, and maintain a minimum of collective trust and regulation. Given comparable exposure to forest fires, for instance, countries with emergency services, aerial firefighting resources, and warning systems are better equipped to intervene early — as we saw this summer. But their resilience also depends on other factors: trust in public information, compliance with evacuation orders, the robustness of energy networks, the continuity of essential services, and the strength of insurance mechanisms, among others.

This aerial view shows the intensity of the fire in the Fontainebleau Forest. Flames are visible in several places above the tree canopy, while a dense plume of gray and orange smoke covers much of the sky. The image illustrates how quickly a fire can spread and the scale of the resources required to monitor and control it. – ©SDIS77 Franck Desprez – ©SDIS77 Franck DESPREZ

Vulnerabilities as accelerators of crises

All societies experience tensions, political conflicts, inequalities, or institutions of varying robustness. These tensions are normal, but they become dangerous when they turn into mechanisms for the propagation of crisis.

This propagation can be intentional, when a society’s vulnerabilities are identified and amplified. Criminal networks have long exploited state failures to establish themselves and thrive. Disinformation campaigns are remarkably effective at creating or fueling anti-French sentiment in the Sahel, anti-European sentiment before Brexit, or “anti-anything” sentiment more broadly.

But crisis can also spread without malicious intent, through the gradual weakening of resilience systems. Underinvestment in justice, education, information, civic space, or a predictable environment erodes trust between citizens and institutions and reduces the collective capacity to respond to the small disruptions that characterize the normal life of a society.

A description attributed to a 1999 speech by Hugo Chávez in Venezuela captures this dynamic: when a system lacks the capacity to regulate a small disturbance, that disturbance goes unaddressed, and further unaddressed disturbances accumulate until the system loses its regulatory capacity altogether — at which point catastrophe follows. That this analysis comes from Chávez makes it, ironically and in hindsight, all the more strikingly relevant.

Apartments severely damaged after a massive 7.8-magnitude earthquake in Turkey, Gölbaşı, Adıyaman

Rethinking cooperation to strengthen resilience

This reading of how crises spread has direct implications for international cooperation. If fragility stems in part from a system’s inability to absorb shocks, then development cooperation cannot simply be about financing projects. It must help create and restore reserves, room for maneuver, and buffering mechanisms that prevent an initial shock from turning into a systemic crisis for those least able to absorb it.

Development cooperation should therefore not be judged solely by the sectoral results it produces, but also by its ability to strengthen essential functions. Yet resilience capacities often remain invisible until they’re actually called upon. An unused financial reserve, strategic stockpiles, or even a local mediation mechanism can seem costly in normal times — which is why they tend to be underfunded. Their real value only becomes apparent at the moment they prevent a systemic breakdown.

Imagine a sharp rise in global wheat prices. In a country heavily dependent on imports, with little in the way of foreign exchange reserves and limited fiscal room to maneuver, this price increase inevitably passes straight through to consumers. Outside humanitarian aid may partially meet the needs of the most vulnerable populations, but the price increase will likely fuel social unrest. That unrest can then be presented as proof of the government’s illegitimacy. A disinformation campaign may further amplify the perception that the authorities are lying or concealing the truth. A violent response from security forces will confirm the narrative of a repressive regime. Foreign investors pull back, or international cooperation slows. Public revenues fall accordingly, leaving the state with fewer and fewer means to stabilize the situation or invest in the future.

What began as an economic problem stemming from an external shock quickly becomes a political crisis, and potentially a security crisis. The economic, political, societal, human, environmental, and security dimensions don’t operate independently of one another — they reinforce each other in a virtuous or vicious circle.

Resilience does not mean preventing every shock. No country can eliminate its exposure to crises, especially global ones. Resilience means preventing a shock from destroying the system’s capacity to function, by building buffers. Buffers slow the spread of failures. They give authorities time, offer populations alternatives, and preserve the possibility of political decision-making. Should we cut our energy consumption at the cost of economic growth, or should we keep economic activity going by subsidizing household and business access to energy? And if so, with what resources — more debt, or more taxes? These are the difficult choices currently facing every country heavily dependent on energy imports.

Rocket launchers at the Obuz-Lesnovsky military base in Belarus, an ally of Russia (2021)

This conception of resilience is universal. It avoids dividing the world into fragile countries that supposedly need help and strong countries that supposedly hold the solutions. Every society faces the same need to maintain its cohesion, protect its essential functions, and renew its capacity to adapt. This is why the concept of resilience should not be reduced to disaster preparedness. It is fundamentally political. A resilient society is one that can weather a crisis without losing its decision-making mechanisms, its principles of legitimacy, or its ability to shape its own future.

Cyprien Fabre.

Cyprien Fabre is the head of the « crises and fragilities » unit at the OECD. After several years of humanitarian missions with Solidarités, he joins ECHO, the humanitarian department of the European Commission in 2003, and holds several positions in crisis contexts. He joins the OECD in 2016 to analyze the engagement of DAC members in fragile or crisis-affected countries. He has also written a series of “policy into action” guides then ”Lives in crises” in order to help translate political and financial commitments of donors into effective programming in crises. He graduated from the Faculty of Law of Aix-Marseille.

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How vases break

East and West Germans in front of the Brandeburg Door during the fall of the Berlin wall in 1989

We are all well aware of the scale of the transformations currently underway; there is no need to list them. What matters now is understanding what they reveal.

The tensions we have seen escalate in recent years are leading to the normalization of violence within our societies and between them. Violence is surely one of the oldest mechanisms for resolving conflict; it allows political or economic objectives to be achieved quite effectively, and now at little cost. Conflicts are therefore proliferating. These conflicts, even local ones, cause shocks whose effects often spill over beyond the areas where they occur.

For these shocks do more than simply disrupt the smooth functioning of human systems. They reveal their vulnerabilities. These underlying vulnerabilities—often invisible or underestimated fault lines—are nevertheless very much present. Like a vase that breaks, perhaps not at the first impact, perhaps not at the second, but one day, a tiny jolt can trigger a disproportionate reaction, and the vase breaks where the structure is most fragile. For societies and countries, there are structural vulnerabilities—the so-called “root causes,” those deep-seated issues we can do little about: poorly defined borders, extreme climates, history, and geography. And then there are more immediate factors of fragility or resilience: governance, demographics, the management of scarce or abundant resources, levels of development and security, social cohesion, and so on.

© AFP – Chart about climate change based on the last GIEC report

Yet the traditional foundations of energy systems, ecological stability, governance structures, and technological infrastructure continue to shift, creating significant uncertainty about future risks. What is at stake, ultimately, is the ability of systems—economic, political, and societal—to self-regulate, absorb shocks, and adapt to them, because the only certainty is that this is not over.

Shocks of all kinds are interconnected and therefore more systemic. A regional shock in the Persian Gulf directly impacts the number of days worked in Sri Lanka, or access to healthcare in Somalia. You may also recall the 2010 eruption of Eyjafjallajökull in Iceland and its effect on air traffic across Europe.

© UNNEWS – Graph representing the correlation between the rise of gaz and fertilizers pricessince the Strait of Hormuz blocade

Governments—and, even more rapidly, private companies—have begun to adapt to this era of high volatility. The insurance sector, for example, which is so fundamental to global logistics, is changing its perception of what is insurable and what is not, giving rise to hybrid public-private risk management mechanisms that are becoming key components of the globalized economic system.

In many countries, the repeated shocks since the start of the century have gradually eroded fiscal, energy, and food reserves, as well as institutional capacities and social cohesion. We are therefore indeed facing a crisis of resilience that we must all now address. Of course, countries that start out with disadvantages in governance, financial dependence, or energy dependence are the most vulnerable, and thus their fragility worsens. Some countries become trapped in cycles where each crisis reduces their capacity to respond to the next one, which is sure to follow soon.

© Solidarités International – Well in the Khodai Ram village, Gulestan region in Iran (2023)

The lack of investment in resilience and shock-absorption mechanisms thus guarantees future instability, even in countries that appear to be stable. Foreign exchange reserves and dependence on energy or fertilizer imports are making headlines right now. Dependence on food imports was highlighted at the start of the war in Ukraine. Inflation and debt levels were key factors during the financial crises and even during the COVID-19 pandemic. But societal risks are just as significant. These include educational attainment, access to healthcare and social services, energy and food, employment, the prevalence of organized crime and corruption, as well as information and religious systems, and so on. Failing to pay attention to these factors means ignoring vulnerabilities through which a crisis could arise or resilience factors that can be leveraged.

In this context, economic and social development is certainly a positive step toward increasing these absorption capacities, and the idea that better-off countries should assist those less fortunate is a matter of common sense, given the regional or global repercussions of even localized instability.

© Cristian Camilo Estrada – In the context of a global crisis, cooperation is more important than ever

The Sustainable Development Goals are no longer really the framework of reference for development actors. The bright colors of the 17 small numbered squares have certainly faded. International standards are no longer held in high regard either. In Sudan as in Lebanon, international humanitarian law is violated every day with complete impunity. This impunity is not without consequences, as it undermines the credibility and legitimacy of the system of solidarity and cooperation, as evidenced first and foremost by the decline in ODA investment.

Yet numerous initiatives are underway to establish new rules of the game for cooperation—that is, in fact, new dynamics of power distribution around development. What does ODA represent, to whom and for what purpose does it serve, and what effort does it measure? Who implements it? In all the current initiatives and proposals, no one is seriously suggesting a complete halt to cooperation, even in its most limited form. Rather, it must simply adapt to a harsher international environment.

For DAC members, the scale of the defense capability shortfall is such that addressing it has become a political and budgetary priority that leaves no room for development—in Europe, of course, but not only there. The Asian region is arming itself just as rapidly. Yet, as the Chief of Staff of the Army, General Schill, recently noted in Grand Continent, the boundaries between the civilian and military spheres have become so blurred that it is difficult to distinguish war from peace, with the contours of conflict becoming so indistinct that peace itself would seem to be the continuation of war by other means. Thus, whether through influence and information, the projection of values, or trade terms, development cooperation can no longer be treated as a sphere of public policy sheltered from the world’s turmoil.

© Markus Rauchenberger – Truck equiped with a Caesar canon and driven by Frencg soldiers during a NATO training exercice in 2018 (Dynamic Front)

Understanding the political nature of international cooperation does not mean that it must renounce its fundamental values—democracy, the rule of law, peace, human rights, gender equality, and freedom. On the contrary, these values are our defining hallmark, and they must not be abandoned in exchange for a bag of rare earths or simply out of intellectual laziness. The goal is to anchor and sharpen these principles in a more complex and competitive environment and use their value to build resilience against future shocks.

Cyprien Fabre.

Cyprien Fabre is the head of the « crises and fragilities » unit at the OECD. After several years of humanitarian missions with Solidarités, he joins ECHO, the humanitarian department of the European Commission in 2003, and holds several positions in crisis contexts. He joins the OECD in 2016 to analyze the engagement of DAC members in fragile or crisis-affected countries. He has also written a series of “policy into action” guides then ”Lives in crises” in order to help translate political and financial commitments of donors into effective programming in crises. He graduated from the Faculty of Law of Aix-Marseille.

 

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