ÖFSE on New Private and State Donors

First published on the Euforic Blog

A recent Working Paper (pdf in German) of the Austrian Development Research Institute (ÖFSE) looks at the discourse on the ‘New Donors’ in development cooperation and assesses the impact of these new private and state actors on the global aid and governance system.

While the traditional (Western based) donors refer to the OECD indicators to describe and legitimize their aid, new donors have a rather different attitude towards these standards. This is ranking from a more or less loose reference (i.e. new European Member states or Israel) to clear opposition (i.e. China, India or Russia) to what is seen as a Western dominated system.

This is even amplified by their unclear role in the global aid and governance system. China or India, the biggest new state donors, both still have to deal with severe internal development problems while at the same time acting as donors in Asia and Africa.

Additionally these countries can no longer be ignored by global governance arrangements taking into account their rise as global economic players. Combining cheap labor with a high investment in R&D they also show new success strategies for economic development.

Last but not least the connection of economic interests with development programs poses additional challenges for the traditional aid system. This makes it difficult to analyse the real impact of the new actors.

Nonetheless the authors predict that the OECD paradigm regarding the definitions, categories and practices of aid can no longer be maintained in the future without taking into account the new donors’ activities.

The paper also looks at the increasing private engagement in development. According to the World Bank private foundations contributed 5 to 7 Billion $-US in 2006 compared to 104 Billion $-US ODA. However, considering the stagnating public aid figures and the growing private investments there is a great awareness of these private activities.

The authors see the political and economic independence with a possibility for long-term engagement, the willingness to take higher risks compared to state actors, and the professionalization of private donors as rather positive.

Their low experience in the field, their tendency to combine aid with public relations strategies can be seen as a challenge for the future. Furthermore the paper criticizes that money is not always spend were most needed which might have a negative influence on policy prioritisation in aid-dependent countries. This can result in a withdraw of resources from one sector in support of the sector prioritized by the private donor (i.e. personnel from basic health care to HIV/AIDS).

The authors conclude that more research is needed to assess the real impact of new private and state donors on the global development agenda.

See also EADI’s EDC2020 project on the New Drivers in Development Cooperation

 

Democracy promotion: No end of history

First published on the Euforic Blog

While democracy promotion became a ‘Boom Industry’ of International Cooperation in the 1990s, governance indicators show a negative global trend today. At the same time International Democracy Assistance is criticized for not showing measurable results. A Briefing Paper of the German Development Institute looks at strategic challenges for Democracy Promotion and Assistance. The authors come up with 10 recommendation:

1. Invest in research about the preconditions, catalysers and processes of democratization
2. Take regard of conflicting political targets
3. Ensure a coherent policy towards partners
4. Take regard of regional and local contexts
5. Take a strategic and long-term approach
6. Chose the right partners to support change
7. Be aware that the time of invention offers different opportunities, be flexible if change happens
8. Take the right measures at the right time (i.e. human rights before democratic elections)
9. Ensure coordination and synergies with other policy sectors
10. Take a holistic systemic approach for evaluation instead of looking only on project outputs

See the Euforic newsfeed and dossier on governance. See also ICCO on Democratization and Peacebuilding

 

German experts call for a different development policy towards Africa

First published on the Euforic Blog

In a concise appeal (in German), senior experts of German developmentcooperation have called for a revision of German development policy towards Africa.

They criticize the belief that the West could develop Africa. The fact that development workers take on too much power would paralyze self-initiative and African ownership. Furthermore they criticize the assumption that redistribution of wealth via increased aid would improve the situation. According to the critics, more money tends to have inverse effects and if distributed via budget aid would additionally increase corruption and bad governance.

The authors call for:

• Decentralization of German aid to country embassies and the liquidation of the current multiple aid structure with various government agencies responsible for development cooperation
• Strong orientation towards non-state actors
• Concentration on education, micro-finance and work-intensive infrastructure improvements

The appeal, which was signed by former German ambassadors, high-ranking politicians and scientists, provoked harsh criticism (in German) by Germany’s development community. They accuse the critics of painting a cut and dried picture of a rather complex environment that ignores the importance of good governance and the role of the state as well as international trade structures.

Willing to kick-off a comprehensive discussion on German aid, the authors of the appeal agreed to further elaborate responses on the criticized issues in a second paper.

See the Euforic newsfeed on German Development Cooperation

 

Reforming the EU’s Aid Architecture and Management

First published on the Euforic Blog

According to a recent paper by the German Development Institute , the European Commission should not anymore be the main focus of reform in the EU aid architecture. Sven Grimm proposes to look more on the whole system, meaning not only aid administered by the Commission but to assess the entire EU aid system which includes the member states and the Commission. Grimm argues that the Commission went through an intense reform process but that the system as a whole still needs reform.

“…the bucket of EC aid appears to have been fixed and is no longer leaking profusely. However, if one looks at the overall system of EU external relations with developing countries, there is not just one bucket (the Commission), but at least 27 more (the member states). And the question to be asked is: Given this line of buckets – all shaped differently, with different size and made of different material – can the EU deliver effectively the way it is organized at the moment?”

According to the author, challenges ahead which will require close coordination with the EC aid system include the shift to partner country level ownership as demanded by the Paris Declaration, the future EC aid budget negotiations, the division of labour between the EU 27 +1 as well as the yet unknown consequences of the Lisbon treaty reforms regarding EU development policy.

by Martin Behrens

See the Euforic newsfeed on EU cooperation.

See also the Whither EC Aid Project on the future of EU Development Cooperation.