Africa: a path to Dutch growth?

Mar 27th, 2012 12:12 PM UTC
By Bob Geldof

Guest blog post from ONE advisor and advocate Bob Geldof, which was published today in the Netherlands as part of the #YouGetWhatYouGive campaign:

Has it come to this? A nation that pioneered the exploration of undiscovered continents, one of the first true capitalist economies and earliest global traders, is about to turn its back on the world?  A country that has always understood that its economic and cultural self-interest lies in global engagement is set to retreat to a state of Little Hollanders? This Low Country that has always occupied the high moral ground, and been admired around the world for that, is actually willing to throw away that hard-won reputation for the sake of a short-term saving of next to nothing, and at the long-term cost of its place in the global economic recovery?

One of the Netherlands’ greatest exports – its wise, generous and profitable investment in the development of the world’s poorest countries – is under threat because of petty and short-sighted political posturing. Just at the moment when years of investment are leading to rapid growth for Africa, creating phenomenal opportunities for Dutch companies, there is a real chance the country will cut aid to Africa, turn its back on the continent and write itself out of the story.  This would be a huge mistake. You might expect me to say that Dutch aid should not be cut because it will cost lives, and it will. Cuts in aid will mean children who do not go to school, families locked in permanent extreme poverty, women left to give birth alone.  And yes, lives lost as clinics are closed, AIDS patients have treatment withdrawn, innocent victims of natural disaster and war are unreached and left to die.  All this is true.  But this is not my point.

My point is that the evidence is clear: Dutch aid doesn’t just deliver for Africa. It delivers for the Dutch. This is true in a very direct sense, as about 40 per cent of Dutch aid flows directly back to the Dutch economy.  But it doesn’t stop there: investing in development is more important now than ever before as Europe tries to grow its way out of economic misery.  It will help to create markets. For a country like the Netherlands whose past, present and future prosperity is based largely on world trade, investing in global development is the smartest thing to do. Just as the growth of India and China has led to jobs and wealth creation in the Netherlands, Africa too holds the promise of new economic opportunities at home.  Aid has helped Africa to reach an economic take-off point. The Netherlands and the rest of Europe can fly in Africa’s slipstream. How foolish would it be to now cut off Holland’s economic nose to spite its austerity face?

The question should be asked: why is China increasing its aid as well as its investment? Why is Britain increasing its aid as well as its investment? Why does the German government say for every German euro spent on aid, Germany receives euro 1.40 in benefits? These are the hard questions the Dutch government should be asking itself, rather than indulging in outdated platitudes on the cost of aid. Debt cancellation, predictable aid flows and, as a result, decreasing mortality figures alongside increases in health and education, mobile connectivity and Chinese investment have all put Africans onto the fastest growing middle class in the world, outpacing last year even Brazil in consumer spending. This is the reality of the 21st century and not the tired bromides coming from some less thoughtful and intellectually lazy Dutch politicians.

For a continued tiny investment of 0.7% of its wealth, the Netherlands has bought the entrance ticket to the biggest growth story in town: Africa. To cut now would be the ultimate political and economic folly – just at the moment that every euro in aid will pay back far more in new markets and opportunity.

International aid may be a soft target in hard times.  But those in Holland who argue against maintaining aid are betting against their own country’s economic recovery and future prosperity.  Even at this eleventh hour, the Prime Minister should realise what is at stake – and change course.

Find out more on the #YouGetWhatYouGive website and please tweet about the campaign using the hashtags #YouGetWhatYouGive and #jeKrijgtwatjeGeeft

TAGS: Development Assistance, ONE