17 June 2010
by Nora Honkaniemi
"The difference between what we do and what we are capable of doing would suffice to solve most of the world's problems. ”
- Ingrid Srinath, Secretary General of Civicus, quoting Ghandi at the United Nations Development Cooperation Forum (UN-DCF) high level symposium in Helsinki, a pre-event to the UN-DCF forum in New York on the 29-30thof June.
The UN-DCF is a biannual multi-stakeholder forum on international development cooperation. The second UN-DCF aims to set priority actions to better implement commitments on development cooperation. This is particularly important in the context of the financial crisis, which sees many countries feeling the crunch and slashing their aid budgets as a result, precisely at a time when there is an increased need to ensure cooperation on the delivery of the internationally agreed development goals (IADGs). As Sha Zukang United Nations Under Secretary General for Economic and Social Affairs (ECOSOC- the UN body that convenes the DCF) aptly stated, “when the rich begin to feel “poor” will they still keep their promises to development cooperation?”
The road to the UNDCF forum: second stop- Helsinki
The Helsinki event was one of two high level symposiums that were held in preparation for the New York DCF, and that also build towards the Millennium Development Goals (MDGs) Summit in September, and the 2011 Seoul High-Level Forum on Aid Effectiveness (HLF). All three processes are opportunities to advance the achievement of fundamental and lasting reforms to the existing global governance architecture.
Following the first symposium in Vienna in November 2009, the second in Helsinki on the 3-4th June focused on PCD, mutual accountability, gender, and the role of Civil Society Organisations and foundations for achieving the IADGs. PCD encompasses going “beyond aid” issues, and examines the need for policy coordination across a broader range of institutions and policies in order to ensure non-development policies are promoting rather than undermining IADGs.
Policy Coherence for Development: is progress being made?
Supachai Panitchpakdi, Secretary General of the United Nations Conference on Trade and Development (UNCTAD) echoed the unspoken concerns of many by underlining that the more we talk about PCD the less coherence we see. Instead we are saying one thing and doing another. He said “Development efforts must also focus on investment and the building of productive capacities for sustainable and inclusive growth”, and recommended making full use of policy space to regulate markets and set appropriate macroeconomic policies.
Moreover, he noted that “during the financial and economic crisis, there was a redistribution of debt from the private to the public sector, from the wealthy to the poor: private deficits became public deficits.” He pointed at the incoherence between aid receiving and debt servicing in developing countries, and promoted UNCTAD’s proposal for a multilateral debt resolution mechanism as a solution for debt issues in both North and South.
He also stressed that in donor countries, public support for aid may be at risk when “aid budgets are funded by a tax system that increasingly weighs most heavily on low income and middle class tax payers who cannot avoid paying tax”, and criticized the G20’s failure to agree on effective measures to fight tax evasion: “It is time to close the tax havens and put a stop to the abuses of the privileges of wealth”, says the UNCTAD’s Secretary General.
Non-aid policies have a critical implication for sustainable development. The focus of discussion at the symposium was on developing countries improving their policy coherence by analysing trade, investment, debt relief and migration policies to ensure that they do not undermine aid policies. The discussion, however, took place without a thorough analysis of the asymmetries in power between developed and developing countries in the current global governance system and the difficulties that power imbalances and the consequent lack of ownership present in implementing the agenda.
Tony Tujan, director of IBON International, and co-chair of the CSO platforms BetterAid and Reality of Aid, representing civil society, emphasised that PCD is often confused with harmonisation and coordination, but encompasses in fact an overarching development policy environment that ensures economic relations do no harm and improve country ownership of development policies and programmes. PCD is essential for achieving development effectiveness based on fundamental principles of human rights and sustainability that goes beyond economic growth.
Achieving PCD and development effectiveness, according to Tony Tujan, would require increased coordination between donor ministries, strong leadership by developing countries in development planning, and oversight mechanisms such as national anti-poverty commissions. Impediments to these goals include continuous aid fragmentation, that is many donors with different and often conflicting practices funding one recipient, and practices of multilateral organisations that enhance incoherence and contradictions, for example the WTO, the IFIs, and EC trade policy to name a few. Also the essential roles of CSOs and parliaments need to be enhanced to achieve PCD.
It was proposed that aid architecture reform is urgently needed, as there is no international norm setting mechanism for development policy and no cooperation architecture to address incoherence. The BetterAid platform is studying the feasibility of proposing a convention on development effectiveness in development cooperation that would address issues of adherence to internationally agreed development goals and conventions, and strengthen international policy frameworks to enhance PCD.
The report of the Secretary General submitted for the consideration of the DCF details that donor country development policies are concentrated mainly on official development assistance, and do not take sufficiently into account the major impact of other policies including trade, environment, climate change, security, international finance, investment and policies of multilateral institutions. This vast range of policies is driven by different agendas and priorities, of a diverse set of actors whose priorities and interests may not coincide. The report stresses that the DCF will continue to assess these processes with a view to establishing best practices for policies which go “beyond aid” to all aspects of cooperation.
Both EU and OECD-DAC members’ progress on PCD has been mixed and there is a need for more systematic evidence about the benefits of coherence and the costs of incoherence. The report emphasises the need for further political will and commitment on the part of all stakeholders to streamline policy in order to achieve desired development outcomes. The report highlights how maximising tax revenues for development can reduce dependence on development cooperation for budget financing, facilitated for example by the creation of an international tax cooperation framework. The report notes with concern that most areas of the global partnership for development are not living up to expectations and, without progress across the board, development cooperation will have limited impact.
Ahead of the upcoming DCF in New York on June 28-29, CSOs organised in the BetterAid Open Platform emphasize that human rights, solidarity, gender and social equality, responsibility and mutual accountability have to be the guiding tenets of PCD. The debate about PCD and “beyond aid” policies is necessary, but it is no excuse for the rich countries’ ongoing failure to deliver on the aid quantity and aid effectiveness commitments. For BetterAid, a deep reform of the existing global governance architecture at all levels - including in financial markets, trade, foreign direct investment and debt – is a prerequisite for PCD. A new Global Economic Coordination Council under the umbrella of the United Nations, as proposed in last year’s Stiglitz Commission report, would be a first step into this direction.
Source: http://www.eurodad.org/whatsnew/articles.aspx?id=4159