HLF4 – we’ll always have Paris

Development Policy20 Oct 2011Jiesheng Li

“We’ll always have Paris” says one of the most famous lines from the movie Casablanca. In the international donor community, “always [having] Paris” would refer to the Paris Declaration on Aid Effectiveness launched back in 2005. Six years and two High Level conferences on, only a relatively small number of donors have achieved the Paris objectives.

However, the aid landscape was changing even before – and has changed since – the Paris Declaration was implemented. This post focuses on three interconnected development issues that donors should tackle: securing fragile states, climate change and migration. These issues have of course been addressed across the years by donors and aid recipients, however they have not often been made to work in tandem with the objectives of aid or Official Development Assistance (ODA).

Stabilising states, especially those classified as “fragile states” has been a major concern of donors for many years. The concern was further highlighted in the World Bank’s 2011 World Development report and the UK has pledged to spend 30% of its ODA on countries designated as ‘fragile‘. Clearly, they should be considered as part of an augmented Paris Declaration, with a stronger focus on harmonisation between not just bilateral donors and aid recipients, but with multilateral organisations that have specialised knowledge of conflict. It may be argued that using ODA to prevent or address states in conflict demeans the definition of ODA. In such cases, a new aid agenda could focus on a new type of financial assistance that would be provided only to fragile states.

Financing for climate change is not a new idea in the donor community. In fact, based on the above definition of ODA, climate change is explicitly linked to many issues in development. To draw it into a global agreement on aid (or both aid and development), the maintenance of a country’s environment must be meaningfully related to the issues of “ownership” and “results”. Climate targets must not be sub-topics in any development assistance but rather an essential goal.

The recent 2010 World Migration Report compared the global distribution of remittances versus the global distribution of ODA across regions. It noted that in almost all cases, remittances greatly surpassed ODA. Migration clearly should be on the development agenda. An improved aid effectiveness agreement could look at the possibility of inserting remittances as part of ODA targets in individual nations. Donors and stakeholders should see remittances as a possible future financial resource as ODA is reduced in high growth countries.

These three issues clearly are significant for today and tomorrow’s aid and development landscape. However, a forum discussing the progress of aid effectiveness may not be the right venue to cover these topics. Certainly, donors may have a stronger vested interest in their own aid than remittances, which are not under the control of governments. Migration and its related effects should be channelled through a UN-led forum, chaired by developing countries who would be the beneficiaries. Second, while Climate Change can and is being tackled by ODA, a discussion of aid relations would be far less ideal than bilateral, regional or global talks specifically on climate policies and solutions. Even though there have been deadlocks in climate deals, Busan should be first and foremost about making aid really work for stakeholders.

The stabilisation and security of states can be incorporated in Busan’s agenda, provided again that it does not turn donors’ ODA into a foreign policy tool away from that of a development-based one. In fact, many recent aid initiatives such as the US Millennium Challenge Corporation work upon little of the Paris principles but more on security. More importantly, if aid effectiveness should reconsider the aid agenda, it must have the voice of the aid recipients who are still largely ignored even with Paris principles implemented. Former conflict states could for example, be part of the Busan conference to provide knowledge on how to execute aid effectiveness with a broader development agenda.

At Busan, donors and recipients will definitely always “have Paris” on their minds. The development landscape however should include the above three topics and more to make an aid effectiveness agreement relevant for the future. Topics such as climate change and migration however may not be ideal for the setting of Busan. Those gathering at Busan should rather make a final push to put aid as an essential mechanism for aid recipients while still considering the future development landscape.