(9 December 2011) — More than 3000 government officials from over 160 countries agreed to a new international architecture for aid last week in the port city of Busan, South Korea. The Fourth High Level Conference on Aid Effectiveness (HLF-4), which ended on December 1, was aimed at improving the way official development assistance (ODA) is being delivered to the poor.
What was achieved however was a declaration on how to do better, with the harder work of adopting concrete actions, time bound commitments and measureable targets deferred till June next year.
Yet some are encouraged by the outcome. New donors such as India, China, Brazil and Russia acceded at least in principle to international best practices on how aid is to be delivered.
They have vehemently resisted throughout the conference to being held to the same standards as the traditional donor countries, arguing that tying aid to transparency, accountability and monitoring mechanisms would hinder rather than facilitate aid delivery.
In the end, a compromise was found in the declaration recognising that “the principles, commitments and actions agreed in the outcome document in Busan shall be the reference [for these countries] on a voluntary basis.”
“It’s a big step forward that China is at the table, but it’s a pity that they aren’t yet ready to promise to act on what they say,” said Antonio Tujan, chair of BetterAid.
Critics have pointed out repeatedly that China exhibits a remarkable lack of transparency on the ODA it provides, especially to Africa, where it conducts business with regimes such as Robert Mugabe’s government in Zimbabwe. China has never released data related to aid, apart from one white paper this year that revealed that it had given about US$40 billion in ODA over the last six decades. Much of that aid has gone to African countries where Beijing has growing interests in oil, minerals and other natural resources.
However, China is increasingly aware that its “mercantile approach” to aid is meeting resistance, Andrew Mitchell, UK’s Secretary of State for International Development, said on the conference sidelines.
Hillary Clinton, the US Secretary of State was less diplomatic, cautioning in her keynote address during the conference for “the recipient nations [to…] be wary of donors who are more interested in extracting their resources than in building their capacity”. Though she did not mention any name, the general consensus was that her barb was aimed at China.
According to Professor Deborah Bräutigam in China, Africa and the International Aid Architecture published by the African Development Bank, China and India along with Russia and Brazil are blurring the boundaries between aid and commercial investment, undermining the hard-won consensus that aid should be devoted exclusively to reducing poverty.
Still, there is a strong demand for Chinese assistance in Africa.
“A lot of African leaders say that with Western donor countries, they just end up having negotiations after negotiations after negotiations, but with China, things happen,” former UK Prime Minister Tony Blair explained.
With the increasing aid largesse of these fast growing developing countries donors, things will keep happening. Countries such as China and India do not give out official annual ODA figures but estimates put the total aid flow from the emerging donors at US$11–41.7 billion, making up 8-31% of global gross ODA. Going by the higher estimates, China, Brazil and Saudi Arabia give more ODA than half of traditional OECD donors.
The largest donors by volume in 2010 were still the UK, France, Germany and Japan and the US, which continued to be the largest single donor with net ODA disbursements of US$30.2 billion.
However, “the politics have changed”, Paul Okuma, head of Secretariat Africa Civil Society Organization Platform on Principled Partnership, told Inter Press Service. The European Union and the US are no longer the only drivers of development aid.
“The thrust for all development actors is to get along with China to support the need of the state, which is growth. The option we face is to work with citizens in developing countries to be more aware of their own development effectiveness,” said Okuma.
“This is the lesson in Busan.”