|This is a scenario where the state assumes the role of leader and manager.
State planning and co-ordination are seen as central mechanisms for
accelerating development and delivery to citizens, especially poor,
unemployed and vulnerable people. The ruling party argues that strong state
intervention in the economy is in accordance with global trends, and the
electorate, concerned about the impacts of the global economic crisis, gives
the ruling party a powerful mandate. Strong state intervention crowds out
private initiative by business and civil society. The risks of this scenario are
twofold: one is that the country accumulates unsustainable debt; the other
is that the state becomes increasingly authoritarian.
||State-led development cannot
succeed if state capacity is
seriously lacking. In addition,
pervasive state intervention,
where the state is everything
and all else is subordinate,
breeds complacency and
dependency among the citizenry.
Strong state intervention crowds
out private initiative by business
and civil society.