New Directions in International Aid

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New Directions in International Aid

• Henrik Secher Marcussen,
• Centre for International Development Studies,
• Dept. of Society Globalisation

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To-days Menu

• The Background Development and Aid in the
  Post-War Period
• The Different Motives of Aid
• Phases, Forms, Focus - and the Language of Aid
• New Directions of Aid
• Recent Challenges to the Directions of Aid
• Points for Discussion

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1) The Background

• Marshall-aid in the aftermath of the war
• IBRD The International Bank for Reconstruction
  Development IMF (Bretton Woods, 1944) Creation
  of the UN, 1948 OECD, 1948
• Aid gradually on the agenda, fostered by NGOs
  Solidarity movements, humanistic or religious
  organisations, war and conflict prevention
  movements, poverty alleviation
• Bilateral (stat-to-state) aid a latecomer

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1) Background

• Formal decolonialisation around 1960
  (Africa)(colonies have become too expensive!)
• Aid institutionally anchored, the EEC and France
• Aid as promoter of economic growth, capitalism
  and industrialisation, while keeping former
  colonies within a division of labour
• Aid to-day An industry to fight international
  inequality

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1) Background

• But aid also carried by a big public and
  individual humanitarian and ideological
  involvement (WUS Ibis DanChurch Aid, Danish
  Red Cross, CARE, MS), - and the devoted and
  committed individuals
• Aid in the 1980s and 1990s Strongly increasing
  (state) bilateral aid, increasing demands on
  professionalisation, control and outputs,
  management inspired and with a broad political
  consensus

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1) Background

• If two thirds of the world must retain poor so
  that one third can stay rich, it just wont work
  its as simple as that (Barbara Ward, IIED,
  1972)
• My hope is that there is now a recognition on
  behalf of the rich world that they cannot stay
  rich if the world is destabilised by poverty
  (James Wolfensohn, outgoing President of the WB,
  2005)

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2) The Different Motives of Aid

• Closely interwoven relations between societal
  development and the policy and magnitude of
  aid
• Aid policy defined by western (rehional, EU)
  development of capitalism, the internationalisatio
  n of capital (globalisation), global processes of
  differentiation (Africa versus the Tigers), etc.
• Movements of capital, merchandise, labour

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2) The Motives

• Marketed as aid for development, but
• Development Doing good business, altruistic,
  trusteeships, emergency aid and the good will
  of the humanitarian individual (the good
  samaritan)
• Development economic growth
• increased welfare (and the distribution of the
  results of the growth process)
• modernisation (the western development ideal
  and model)
• the dismantling of dependency, replaced by
  autonomy economically, politically, socially
  and culturally

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2) The Motives

• human-centered development basic needs bottom
  up approach people governed development
  participation empowerment
• sustainable development
• partnerships, development contracts and
  binding mutual agreements control, monitoring
  and canditions (sanctions)
• not aid, but collaboration between equal
  partners, objectives and means identified by
  recipient governments

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2) The Motives

• The cynical perspective How interventions, aid
  and mitigating efforts are situated within
  perspectives of national chuavinism,
  international politics, and power play, hegemony
  and (ressource) control (the US, France, China,
  the EU?)
• The idealistic perspective Altruism,
  help-to-self help, rights, decent living
  conditions, mitigating global inequalities,
  solidarity
• Where are we to-day? Who sets the agenda? Which
  societal model? Who holds hegemonic power? Which
  are the currently prevailing motives?

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3) The Phases, Focus

• 1955 65 Growth, Central Government Trickle
  down, Infrastructure, Industrialisation
• 1965 75 Managed, Blueprint Development,
  Integrated Development, Agricultural
  modernisation, Technology Transfers, Top down
• 1975 85 Small is beautiful, Community based
  organisations, equity
• 1985 95 Enabling environment, capacity
  building, participatory learning processes,
  ownership, empowerment, NGOs
• 1995 2000 Partnerships, contracts, users pay,
  conditionalities, decentralisation and new
  actors, forms and challenges

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3) Phases.

• The big experiment State Market Civil
  Society
• From projects to programmes, to sector wide
  approaches, to basketfunding and general budget
  support
• Overall poverty alleviation, in reality much
  fragmented
• The many strategies and a lack of a general
  development vision
• Complexity versus the objectivebased results
  management
• From the single donor to harmonisation and
  division of labour
• Consensus, convergence and mainstream, the
  overcrowded middle field

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3) The Phases

• After steadily increasing aid now stagnant, from
  around USD 55 billion to around 100 billion
• Danish aid in top five formerly 1,06 of GNP,
  now 0,8 around DKK 15 billion
• Private capital transfers the double
• Remittances threefold
• Military assistance/military budgets, far above
• Aid primarily strategically chosen 30 of French
  aid to overseas territories Israel, Egypt,
  Iraq
• Africa Main recipient of bilateral aid

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3) The Phases

• The objective of Denmarks bilateral aid..is
  through collaborationto support governments own
  priorities to foster economic growth to ensure
  social progress and political independence (En
  verden i udvikling. Strategi for dansk
  udviklingspolitik frem mod år 2000, 1994)
• Poverty reduction overarching development
  objective

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3) The Phases

• DenmarkDevelopment Policy. Partnership 2000
  poverty alleviation
• Mutually binding agreements and collaboration
  respect for recipient governments own priorities
  and context specific situations
• Long term and sustainable
• If not, then

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3) The Phases

• Security, growth and development, 2005
• Globalisation Progress in Mutual Partnership,
  2006
• The Endless World (den grænseløse verden) The
  Foreign ministry and globalisation, 2006
• A world for all. The governments development
  policy priorities 2008 2012 (2007)

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4) The New Directions

• 2015 goals The Millenneum Development Goals,
  MDGs, UNs member countries, 2000
• UNDP coordinating and monitoring
• Common objectives, common responsibilities
• Responsibility for meeting MDG goals Rests with
  developing countries
• Goals directing poverty reduction strategies
  (PRSPs), supported by the WB

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4) The New Directions, the MDGs

• Eradication of extreme poverty halving numbers
  living on income below USD 1/day
• Basic, free education for all
• Equality and womens rights eradicate gender
  inequality in primary education (2005) and in
  higher education (2015)
• Reduce child mortality 2/3 reduction of under
  five years child mortality

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4) New Directions, MDGs

• 5) Reduce mortality amongst pregnant/women giving
  birth ¾ reduction
• 6) Fight against AIDS, malaria and contageious
  illnesses halt AIDS transmissions
• 7) Environmentally friendly and sustainable
  development halving numbers without access to
  clean water and sanitation targeting 100 million
  living in slums mitigate against loss of natural
  resources
• 8) Assure increasing aid, trade and debt relief

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4) New Directions, MDG Status

• 2007 Several goals may be reached, but
  additional aid needed results greatly varying
  Africa is lagging behind
• 2009 Several goals may not be reached Africa
  really lagging behind
• Poverty reduction, greatest achievement, but
  falling back
• Primary school 88
• Gender equality, lagging behind
• Reduced mortality, incidences of AIDS, lagging
  behind

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4) MDG Status

• Clean drinking water, 83
• Global partnerships suffering, the Doha-round
• Conclusion Main part of goals will not be
  reached under past, even less under present
  circumstances
• An increased effort needed in Africa Blairs and
  Foghs Africa Commissions
• Directions of these?

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4) New Directions

• MDGs were the first collective international
  effort to address global inequality
• PRSPs first collective effort to develop poverty
  eradication tools and strategies
• Together First step towards new directions in
  aid
• New targets Aid effectiveness, harmonisation,
  coordination and alignment delinking and
  division of labour

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4) New Directions

• The Paris Declaration, 2005
• A reaction against increasing tendency towards
  scattered, uncoordinated and competing/overlapping
  aid efforts, with limited results and greater
  degree of aid dependency
• A reaction against increasing number of actors,
  each with their motives, objectives, achievement
  indicators, and reporting requirements
• A reaction towards increasing transaction costs

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4) New Directions

• Roger Riddell a model derived from the
  industrialised countries in Europe and North
  America which has shown increasing difficulties
  in solving problems, such as poverty,
  unemployment and the sustenance of the welfare
  society () The missing ability of the model to
  function in our own backyard raises the question
  as to whether it is feasible and wanted to export
  it abroad.

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4) New Directions, Paris

• Aid Effectiveness Ownership, Harmonisation,
  Alignment, Results and Mutual Accountability
• Strengthen national strategies and implementation
  modalities
• Support national priorities, systems, procedures
  and institutions, and build capacities
• Strengthen donors and recipients alike in being
  accountable to citizens and democratic
  institutions

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4) Paris Declaration

• Avoid duplication, rationalise interventions
  (best practices), increase cost-effectiveness
• Reform and simplify donor policy and procedures,
  and strengthen the cooperative spirit
• Define achievement indicators, benchmarks,
  performance criteria promote public sector
  management, and reduce fiduciary risks, etc.

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4) New Directions, Paris

• Long range of indicators associated different
  goals, resulting in a complete shift in aid
  relations
• Harmonisation of sectors
• Maximum 3-4 sectors supported by each donor
• Each donor lead donor in 1-2 sectors
• The Government representative always chairing
  negotiations

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4) New Directions, Paris

• Joint Assistance Strategies (JAS)
• Basket funding
• Sector/Programme budget support
• General Budget Support
• Strict systems of monitoring and consultations
  attached
• Conditionalities/sanctions involved, and have
  been appplied

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4) Paris Declaration

• Evaluated in 2008, preparing for the Accra Agenda
  for Action
• Focussing on the process (rather than results),
  the degree to which donors and recipients are
  adhering to the principles Generally good marks,
  much has been achieved, but still long way to go
• Donors have difficulties in letting go with
  control and joining forces with others, less
  natioal visibility of aid, threatening political
  back-up of the public and politicians

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4) New Directions, Paris

• Accra Agenda for Action, September 2008 Follow
  up on Paris
• Continued international backing of principles,
  renewed and strengthened
• But new actors countries and private actors
  not all included
• NGOs adhering to principles and, in cases,
  signing up, but have difficulties as they face
  dilemmas

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5) Recent Challenges

• Traditional aid challenged and exposed by new
  opportunities (globalisation), new threats
  (global security and terrorism), and new actors,
  both new aid donors and new private actors
• Harmonisation efforts challenged by an increased
  tendency to fragmentation
• Focus areas for traditional aid threatened? -
  Good governance, human rights, advocacy,
  decentralisation, anti-corruption,
  democratisation, etc.

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5) Recent Challenges

• Tendency to fragmentation Global and internal
  security, terrorism, climate change and
  environmental degradation, migration, internally
  displaced, civil strife/war, ethnic rivalries,
  market liberalisation/food price hikes, political
  fobias and extremism, etc., etc.
• And challenged by globalisation for good and
  worse

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5) The New Challenges

• The new donor countries China, India, Brazil,
  Venezuela, Russia, the Arab nations
• The new private actors Gates, Buffett, Bono RED,
  Nike, MyC4, etc., etc.
• The new uncertainties surrounding hardware and
  software interventions War, security and
  development. Which one first? And which one able
  to clear the path for the other?
• Synergy? Persistent conflicts? Clash of
  civilisations? Yesterdays terrorists,
  tomorrows civil society?

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6) Points for Discussion

• Where are we to-day? Whos is setting the
  development agendas? Who holds hegemonic
  positions? Who are upcoming global powers? And
  with what effects?
• What are the main motives of todays aid?
• Which are the drawbacks of harmonisation?
• Is General Budget Support good, timely, effective
  and needed?

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6) Points for Discussion

• Does budget support ensure decentralised
  management of resources, poverty eradication and
  meeting the needs of the public?
• What are the effects in donor coumntries of the
  new directions in aid (harmonisation, budget
  support, division of labours, etc.)?
• Are the new actors a threat or a positive new
  turn?
• How should aid (software) and weaponry (hardware)
  be related?