Development Assistance
Julie Walz from the Center for Global Development talks about the organization’s latest report, which ranks countries by their commitment to aid and development.
Last week, at the Center for Global Development, we released the annual Commitment to Development Index -– a ranking of how well rich countries help development abroad.
Though there is clearly a debate about the effect that aid has on development, there is no doubt that developed countries affect developing ones not just with aid, but trade, investment, migration and other policies. Using a series of quantitative measures on seven dimensions, we find that the Scandinavian countries, once again, lead the rich in development-friendly policies. Sweden is top, followed by Denmark and Norway. Only three of the seven G20 nations –- Canada, the United States, and Germany –- were ranked in the top 15 (out of 22).
(more…)
This is the first blog post from ONE intern Tom Wallace, who works in our UK office. Please give him a warm welcome!
The G20, a combination of finance ministers from twenty of the world’s most influential economies, meet in Seoul this week to discuss how to promote development in the poorest nations. Building on commitments made at the G20 in Toronto, under the leadership of South Korea, the G20 has been looking at the conditions that generate development success.
The findings of this research will be presented in Seoul. It is expected that the research will highlight the importance of economic growth as a driving factor in generating poverty reduction. Building on this, it is expected that G20 governments will make commitments to focus more of their efforts on helping generate the conditions needed to stimulate economic growth. This will most likely mean a shift in the focus of government support toward improving infrastructure, increasing financial inclusion, securing private investments, assisting good governance and encouraging food security.
While some may consider this a departure from the traditional poverty reduction techniques Jamie Drummond, executive director of ONE, said “This isn’t a false choice between aid on the one hand and growth or governance on the other — we need a joint agenda combining good aid, good growth and good governance because smart assistance will be needed to help build infrastructure for growth and strengthen governance systems, as well as tackle basic needs in health and hunger in the medium term. Sustainable equitable growth can create the long term prosperity to reduce and ultimately eliminate the need for any aid.”
Want to learn more? Download a copy of “The G20 and Africa: Can an Asian tiger help the African lions roar?”, our Seoul summit pitch on inclusive growth in Africa.
“The issues that we face today- from chronic poverty and hunger to violent acts of terrorism- require that we work seamlessly toward identifiable goals.” Senator Richard Lugar opened with a strong statement on the importance of aid reform yesterday at a hearing of the Senate Committee on Foreign Relations that I attended called The Case for Reform: Foreign Aid and Development in a New Era. Witnesses at the hearing included Peter McPherson, President of Public and Land Grant Universities and former administrator of USAID, Jeffrey Sachs, Director of the Earth Institute at Columbia University and Rev. David Beckmann, President of ONE partner organization, Bread for the World and Co-Chair of the Modernizing Foreign Assistance Network.
The hearing highlighted a bill written by Senators Kerry, Corker, Menendez and Lugar that seeks to strengthen USAID and thereby strengthen the effectiveness of U.S. foreign assistance. The bill has three main facets:
- To strengthen the monitoring and evaluation program of USAID by creating an “internal evaluation and knowledge center” and reinforce the partnership between USAID and the State Department to make sound decisions relating to development.
- To coordinate all U.S. agencies that have a role in foreign assistance by promoting information sharing and appointing a Mission Director at USAID to coordinate all development and humanitarian assistance within all countries where the U.S. works.
- To create a high-level task force at USAID and increase training within USAID and other U.S. development programs to alleviate the disorganization that has arisen with increased funding and decreased staffing at USAID.
McPherson, Sachs and Beckmann spoke very highly of this bill and were in agreement with the idea that the U.S. must increase their capacity in foreign assistance through higher level leadership and monitoring and evaluation. If these steps are taken, USAID will become an effective long-term development agency rather than the short-term disaster relief organization, which it has evolved to in recent years according to Senator Kerry.
Jeffrey Sachs had many strong words of advice to the United States development community. He stated that the framework of development assistance should focus on agriculture, healthcare, education, infrastructure, small business development and climate change, emphasizing that progress on these issues will promote resources which would in turn reestablish law and order in countries like Kenya where it is lacking.
Rev. Beckmann mentioned that the American people value aid reform and increased resources to developing countries, even in hard economic times. He praised ONE along with other NGOs for reaching out to members to voice these opinions and encourage their representatives to support initiatives such as the Water for the World Act and the Global Food Security Act.
- Leah Moriarty
Washington Post reporter Rajiv Chandrasekaran filed an interesting piece on June 19 documenting past failures of U.S. economic assistance in Afghanistan and how the new Administration is taking a different approach (Obama’s War: Starting Over on Development; U.S. Pursues a New Way to Rebuild in Afghanistan).
Chandrasekaran notes how President Obama’s new team in Afghanistan, led by Richard Holbrooke, is “shifting away from an approach employed during the Bush presidency that focused on generating discrete ‘success stories’ and creating long-term economic sustainability through free-market reform.” Agriculture will be the first sector addressed, with a strong emphasis placed on aiding farmers to increase production. Holbrooke aims “to fix what we inherited.”
All good and necessary. But the Obama Administration also needs to think globally. The foreign aid and development challenges in Afghanistan are present around the world where the United States will spend nearly $30 billion this year addressing poverty reduction, economic growth, reconstruction, and humanitarian crises. If the lessons of reform in Afghanistan are applied globally, the result will be a more modernized and coherent American development program that is better equipped to reduce poverty and disease around the world.
According to the article, the new plan in Afghanistan will use smaller contracts, align more closely with priorities of Afghan development organizations, and channel more funds through Afghan government systems. These measures will help to strengthen country ownership and build capacity, two fundamental principles of effective aid that should be integrated throughout U.S. aid programs.
Chandrasekaran notes that U.S. law obstructed efforts to help re-establish Afghanistan’s cotton production for fear it would compete against American growers. That law, enacted in 1979, is symptomatic of a foreign aid legislative morass based on a statute passed during the first year of the Kennedy Administration that has not been comprehensively reviewed or amended in decades. It is time to re-write the Foreign Assistance Act of 1961 and update related appropriation provisions to establish a rationale, flexible, and accountable legislative structure to guide U.S. foreign aid.
As the article points out, Holbrooke and his team have taken control of the reconstruction program from USAID and looked to other agencies to play a greater role in the effort. Some of these measures, at least in the short term, might be necessary to get quick results. But they also highlight the declining capacity that has been allowed to occur for years at USAID, where technical expertise and strategic planning have withered. Turning to the Department of Agriculture for more experts and utilizing National Guard personnel with farm experience may make sense right now. But it is a workaround that does not address the underlying problem of not having a strong, empowered, and adequately staffed development aid agency that can serve as the voice and direction for U.S. global foreign assistance efforts. Do we really want to utilize these highly trained and dedicated National Guardsmen to perform agricultural technical support? Is this the most efficient use of their talents?
Chandrasekaran maintains that during the Bush Administration, the White House and Defense Department favored quick impact, high profile projects in Afghanistan, like roads, schools and health centers. Absent were the long-term, sustainable, but less glamorous programs aimed at building Afghan capacity and addressing country priorities. This will change, according to the new U.S. plan in Afghanistan. But this change needs to happen throughout the entire scope of U.S. development, reconstruction, and humanitarian programs. A global development strategy, a new law, and a strengthened, capable development agency are key ingredients for the successful reform of our outdated foreign aid system. Afghanistan provides some new thinking and hopefully, some good lessons for the broader reform effort.
-Larry Nowels
On Monday, we noted that the Munk debates program would feature a discussion about foreign aid and we encouraged those who watched to post their thoughts and reactions. ONE’s Policy Advisory Board member Paul Collier, along with Stephen Lewis, Dambisa Moyo, and Hernando de Soto talked for almost two hours about the opportunities and challenges of foreign aid. The purpose of the Munk debates is to “enliven and elevate public discussion of the political, social, and cultural issues shaping the course of the world’s events and Canada’s future.” This goal was certainly accomplished – the debate participants engaged in a lively discussion about their thoughts on how and why foreign aid has affected Africa and what are the best ways to reduce reliance on donors to finance programs. Exchanges like this are helpful to educate people about foreign aid and the array of perspectives about it.
While there was disagreement between the two ‘sides’, represented by Moyo and de Soto, arguing that aid does more harm than good, and Lewis and Collier, arguing the opposing view, there was common ground. The debate participants agreed that African countries cannot continue to rely on foreign aid to the extent they are now, that strong leadership and good governance are critical to transitioning from aid dependence, and that aid has had mixed results over the past 60 years. There was also agreement on the importance of the private sector in economic growth, through investment and job creation.
The audience voted before and after the debate on whether foreign aid does more harm than good. The outcome? The majority of people do not believe that aid does more harm than good. This means that both before and after the debate, the majority of the audience believes that aid does more good than harm. Before the debate, 61% of the audience voted ‘against’ the principle that aid does more harm than good, compared to 59% of the audience who voted after the debate. The opposing side, who believe aid does more harm than good, had 39% of the votes before the debate and 41% afterwards.
What do you think? Watch the webcast and let us know.
-Lisa Fleisher
The Swedish and Dutch governments announced today that they will suspend $33 million in aid to Zambia following reports about embezzlement in the Ministry of Health. Reports indicate the civil society was calling for the Ministry of Health to publish expenditures, but former President Mwanawasa cancelled the spending reports, which may have led some officials to siphon funds for their own use. In response to concerns that the lack of funding will affect the delivery of health services, the Minister of Finance Musokotwane stated that the Zambian government will develop a plan to fill the gap and investigate the corruption charges.
The transparent publication of spending by donors and governments is a critical component of ensuring money for development is used as effectively as possible. Like the Global Fund to Fight AIDS, TB, and Malaria, the Swedish and Dutch governments’ response to reports of embezzlement in the health sector suggests their support for the idea that well-governed programs are critical to successful development and that aid can help to encourage transparency and accountability.
-Lisa Fleisher
Today in her opening statement before the Senate Appropriations Sub-Committee on Foreign Operations, Secretary Clinton made clear once again the critical need for overseas development assistance for our economic and national security. She began her testimony by stating, “When I appeared before the Senate Appropriations Committee a few weeks ago with Secretary Gates, we both emphasized the need for a comprehensive approach to the challenges on our nation’s agenda…urgent development needs ranging from extreme poverty to pandemic disease that have a direct impact on our own security and prosperity.”
The Secretary also reiterated the administration’s commitment to meet our goal of doubling foreign assistance by 2015, and highlighting in this year’s budget: $525 million for maternal and child health, about $1 billion for education, $1.36 billion to address food insecurity, and $4.1 billion for humanitarian assistance. The Secretary stated, “these initiatives build good will, alleviate suffering, and save lives, but they also make our country safer and our partners stronger.”
Members of the Sub-Committee present at the hearing included Senators Patrick Leahy, Judd Gregg, Arlen Specter, Kit Bond, Barbara Mikulski, Robert Bennett, and Sam Brownback.
Senator Bond talked about the need for smart power, Senator Mikulski asked about better partnering NGOs with USAID, Senator Bennett emphasized the Millennium Challenge Corporation as a model for assistance, and microenterprise as a way of helping the poor, and Senator Brownback spoke on delivering better results with food aid and micronutrients.
-Arjun Mody
