EU development policy at stake

Europe plays a major role internationally through its development policy. However, the EDC2020 research project indicates that its successful current role will be challenged in the near future. Among the several issues of concern, three were thoroughly analysed by the project.

The first one consists of the arrival in the international development scene of new actors. Countries such as China, India, Brazil, the Gulf States and South Africa have become much more active in developing countries, sometimes pursuing their own agendas beyond those of the OECD’s Development Assistance Committee (DAC)1 member countries and often rejecting the term ‘donor’ in relation to their foreign aid policies.

As their preferences on governance issues are sometimes perceived as being at odds with EU policy, the Union will need to tackle this issue in its future development agenda. The financial crisis has accelerated the global power shift towards emerging economies. The EU should contribute to the adaptation of global governance frameworks to reflect this shift. Also, one aspect many new actors have in common is that development cooperation is closely tied to foreign policy, which adds pressure for the EU to ensure its development goals are more firmly embedded in its emerging foreign relations apparatus.

For example, China’s engagement in Africa (worth around US$ 2.5 billion) has raised concern among EU donors. According to the EDC2020 working paper, European Good Governance Policies Meet China in Africa: Insights from Angola and Ethiopia2, EU policies on promoting good governance face considerable difficulties in Angola and Ethiopia. The research also found that in practice the EU and China have different objectives, their engagement is primarily in different policy fields and their policies are not in direct conflict. There are constraints other than China's growing presence in Africa that contribute to difficulties in influencing good governance reforms and policy effectiveness, including the gap between EU aspirations and actual interventions.

EDC2020 also found that reporting on flows of development funding continues to be inadequate. Investment in better data collection and encouragement for new donors to improve financial reporting are essential to improve co-operation and avert possible goal conflicts.

The second issue concerns the sometimes divergent objectives between Europe's development and energy policies. It is clear that the EU increasingly depends on energy imports, notably from regions experiencing democratic instability. Also, the role of biofuels in the energy supply is expected to increase, and they are sourced partly from developing countries.

European policy makers recognise that a key ‘emerging need’ is to better understand the relationship between energy imperatives on the one hand, and policies related to development, ‘good governance’ and democracy promotion on the other. Policy makers acknowledge that longer term and sustainable energy security must incorporate a governance dimension, and move away from fixed, bilateral contracts, concluded without due regard to producer states' record of development and democracy.

The project analysed energy partnerships in sub-Saharan Africa, the Middle East and Central Asia. Specially detailed case studies of Bangladesh and Indonesia gave examples of how the EU could operate more effectively and also provided useful suggestions for climate change finance development at the international level. EDC2020 recommends that a tighter linkage between development and energy security should be applied in all contexts; and a shift from focusing on the ‘hardware’ (pipelines, contracts etc) of energy contracts to focusing on the ‘software’ (good governance of energy resources). The EU should develop a truly inclusive approach that incorporates both the national policies of all Member States and the actions of European multinationals into a more governance orientated policy.

The third issue relates to climate change as by 2020 greenhouse gas emissions from developing countries are expected to overtake those of developed countries, and it could cause increased water stress for 75 to 250 million people in Africa. These concerns are emerging at a time of global financial crisis, pressure on donor country aid, increased economic growth in Middle Income Countries (MICs) and some Least Developed Countries (LDCs), and questions over European identity. EDC2020 found that the EU should adopt principles such as transparency, accountability and equitability in relation to how climate change funds are mobilised and managed.

As a conclusion, EDC2020 points out that this diversification of the donor landscape provides a timely stimulus for reflecting on the goals and the future direction of EU development policies. New actors challenge the EU to present a clearer vision of its role in the world and better embed development co-operation in foreign policy. Their presence has moved the debate away from national-level poverty reduction strategies towards a new conversation about global risks and challenges. The researchers believe that some form of international agreement on climate financing can be expected by 2020, which should mean greater policy certainty in the following decades.

 

1 See: http://www.oecd.org/document/1/0,3746,en_2649_33721_46662849_1_1_1_1,00.htm

2 See: http://www.edc2020.eu/114.0.html

EDC2020 - European development cooperation to 2020 (duration: 1/4/2008 – 31/3/2011). FP7 Socio-economic Sciences and Humanities, Activity 8 “Strategic activities", Research area 8.2 "Horizontal measures to support international cooperation". Collaborative project (small and medium scale focused research project)..

See: http://www.edc2020.eu/

Contact: Can Akdeniz, akdeniz@eadi.org