The present paper suggests the term sustainability to be indeterminate and therefore useless or even counterproductive if assumed to be a concept or guideline for development. In a development aid context, the term might be considered as a reminder of the economic, ecological, social and institutional dimensions of development.
Neoclassical welfare and growth theory in restricting its analysis of sustainability to market transactions is considered insufficient in guiding policies for sustainable resource use. In rural areas of developing countries not only markets but also non-market and non-government institutions and organisations are seen as instrumental in improving efficiency and sustainability of projects fostering ecologically sound development. NGOs are seen to be well placed to support local communities in the planning of their development, in their gaining access to markets, government services and development aid on equitable terms, and in collective action for the sustainable use of natural resources.
The paper makes reference to Peru, where environmentally oriented local NGOs are supported by international donors and northern NGOs in strengthening local governments and in developing institutions for the coordination and guidance of outside interventions. District planning systems including planning councils, technical assistance networks, concertation and working roundtables, and project fairs are considered transaction cost saving institutional innovations.
