In the early 2000’s the international aid community went through a process of reflecting on the effectiveness of aid, and how we could make sure that resources mobilized through taxes in richer countries produced the intended outcome in poorer countries. We met in Rome, Paris, Accra, Busan and Mexico City, we developed principles and agendas for action, some degree of agreement (but no consensus!) on what good quality aid looked like, some indicators to measure progress and an institutional framework to pursue the agenda (the GPEDC).
I hope I do not offend anyone – least of all old colleagues at the DAC and OECD – when I say that this process seems to have almost completely lost relevance and traction. In my 4 years as DG of Norway’s bilateral aid agency, and later when heading a project to look at the effectiveness of Norway’s multilateral aid, I found little to help me in what remains from this process. Having spent substantive time and energy on the process earlier, both in the Norwegian administration and at the OECD, I do not say this lightly.
At the same time we need to build on the positive spirit of the process. We need to reestablish that the proponents of aid and international cooperation are the owners of the effectiveness agenda, not leave it to the critics. We need to again show willingness to challenge established way of working, and to attempt to build new partnerships. But to do so successfully, we need to reflect on why our earlier journey ended where it ended and to take on board how dramatically the context we are working in, have changed.
I see (at least) 5 reasons why the aid effectiveness process as originally constituted has lost relevance:
- The declining relative importance of aid: The stagnation of global aid and the rapid increase in other sources of development funding over time has reduced the «bargaining power» of aid and its capacity to shape and influence global and national development discourses. While the pandemic has changed this in the short run, I do not think it will fundamentally and lasting change the balance back.
- The changing country context: The typical aid recipient today is a crisis country, sometimes with competing government structures, sometimes with governments with weak legitimacy, sometimes with pockets of war, while much of the old effectiveness approach was built on a stable poor country context.
- The increased importance of (common) global challenges, globally but also for work at country level: The importance of protecting the Congo or Amazon rain forests are not justifies by the priority they are given by national governments (or national civil society for that matter) in Brazil and DRC, but by their global importance as carbon sink. This has broader implications for the justification of aid, but also very operational importance for what type of support to give where.
- The new donor landscape: In 2000 one could still talk about China, India and the Arab world – as «emerging» donors. Now they are well established and sometimes even more important than the DAC donors. And this change is not only about money, it is as much about donors as models, as showing what policy choices are most relevant for success. In the lead-up to Busan, a serious attempt was made to bring new donors on board (with Mexico as an important go-between), but China in the end decided not to join. When that failed, the aid effectiveness agenda could easily be defined as part of the «old regime».
- Changes in the motivation for aid in donor countries: In a changing, and more competitive, international environment promoting national self interests have – again some would say – become a broadly accepted part of the national justification for aid. This of course has implications for e.g. the promotion of untied aid as the gold standard.
More broadly, one can also argue that as the political momentum faded, the aid effectiveness agenda moved into a technocratic phase, where technical solutions became an end. The aid transparency agenda is an example of how adherence to a (not particularly helpful) technical standard became the «gold standard» while loosing focus on the big transparency challenges of new aid modalities and new donors.
Does this matter? As we move into a more challenging budgetary environment in most donor countries (both «traditional» and «new»), the battle to justify aid will intensify. We will be met with both with the argument that aid does not work, and with the false «quality rather that quantity» argument. At the same time, aid, or international public finance, will be more, not less important in the future. Towards 2030 we need to both deal with the drastic set-back in the fight against poverty, and the combined challenges of climate, global health and security.
To win this battle – and we have to win it – we need to to sharpen our weapons and articulate a new agenda for effective international development cooperation, learning from the past process, but adapting it to the realities of the coming decade:
in my view, key elements would be:
- more clearly articulating the comparative advantages of aid (or international concessional public finance) in the financing of both global and national development challenges
- renew the effort to bring all major providers of finance on board, including to create vocabulary and discourse that makes that possible
- make dealing with the global challenges an integral part of the discourse and consider if this necessitates a new vocabulary and new metrics or just adjustments in the old
- accept that dual – or multiple – motives for aid is normal, and that enlightened self interest is a key motivation
- reflect on how to secure that effective international cooperation remains a political agenda, supported by technical work, not the other way around
- and western donors need to critically reflect on what role aid could and should play in pursuing our important different normative agendas.
So dear Susanna Moorehead – you need to take the lead!