My colleagues are finalizing the preparations for a two-day brainstorming session on the future of European aid. It is a good occasion to open the floor to its participants (and beyond: as always anyone should feel free to join in!) to reflect on the way Europeans envisage their development policy: what is it for? How should we go about it? Here are a few initial thoughts.Europe is a giant of development assistance. Combining funds from member states and the Community, EU aid totaled 46 billion Euros in 2007, making it by far the largest contributor to this global endeavor. This amount equates to 93 Euros per capita, compared to 53 and 44 Euros per capita donated by the United States and Japan, respectively.
At a time when European public opinion is focused on the effects of the financial crisis on its purchasing power, some question the purpose of international solidarity. European Commissioner Louis Michel recently shared his fears in the columns of this blog: temptation is strong for Europe to disengage from this policy.
Yet Europe has many reasons to be proud of its development activities. Official Development Assistance (ODA) serves a humanistic purpose: providing support to the poorest meets an ethical objective of justice and solidarity, one which arguably lies at the core of European values. As some people and countries benefit more than others from the global marketplace that has emerged over the last decades, the wealth gap between rich and poor continues to widen. In an era of instantaneous images, we all witness this “global social divide.”
These increasingly visible and thus intolerable inequalities fuel growing tensions, as exemplified by last year’s food riots. Beyond its humanistic purpose, international aid therefore also responds to the need to mitigate some of the risks linked to globalization and the collective perception of insecurity. In this new world of ours, the notion of “neighbor” is redefined. The history of the European Union provides an excellent example: economic integration has gone hand in hand with the creation of mechanisms that foster solidarity between neighbors. Just as it previously was in Europe’s interest to promote growth in its weakest regions, it is today in its interest to promote the convergence of Mediterranean and African economies with its own.
Yet in today’s world, Europe’s neighborhood goes far beyond its immediate periphery: recent events prove that most crises ignore distances. The recent financial, environmental or sanitary crises show that deficiencies of regulation in some countries can quickly turn into domestic problems for the others. The developing world plays a central role in global disturbances: though poorer countries are sometimes at their origin, they are often also their first victims, and always are a key element to their resolution. To cite but one example, fighting climate change effectively will call for countries such as Indonesia, Brazil or Congo to protect the lungs of our planet. By sharing the costs of these efforts, European ODA can enhance vital collective action with countries of the South for the preservation of global public goods.
Aid therefore lies at the crossroads of the interests of donors and beneficiaries; compassion combined with a well-understood mutual interest. In fact European aid is gradually moving beyond a merely compassionate conception of aid toward a more systemic and ambitious vision, i.e. managing a common global space, one where each person’s destiny is linked to the destiny of all. Today more than ever, Europe must uphold its value of solidarity and its willingness to work toward international regulation: such is the (modest!) price to pay to avoid a costly backlash of globalization.
But fighting for a more inclusive global marketplace and protecting global public goods calls for coordinated strategies. This is no easy task, given the continuing proliferation of actors in the ‘market for aid’ – who all have their own agendas. Donald Kaberuka touched upon this complex issue in his first post last year. The advantage is that Europeans can start learning together, and devise an architecture for their common aid policy that will build strategic coherence while preserving the invaluable diversity of member states’ aid institutions. My intuition is that collaborative instruments such as the Neighborhood Investment Facility, the Africa Investment Facility or the European Financing Partners mechanism between European DFIs are promising tools to do this, as they gradually build coherence between donors by giving EU member states incentives to work together, rather than falling prey to the sirens of Goslplan-like coordination. They also associate recipient countries much more thoroughly to the policy choices than traditional aid instruments.
But I should go no further at this stage… The seminar I will attend later this week is meant to reflect on how to go about EU coordination. I will therefore leave the floor for all who wish to share their ideas about where European aid should aim to go, and what are the best ways to build a coherent and dynamic aid practice. I will also fill you in on some of the most promising ideas I take away from what is likely to be a fascinating brainstorming session.
Chairman of Convergences and CEO of Investisseurs & Partenaires (I&P)