Simon Maxwell, Senior Research Associate, former Director of the Overseas Development Institute from 1997-2009
Mikaela Gavas, Research Associate, Overseas Development Institute
European development ministers were in the spotlight at their meeting in Brussels in May, at the General Affairs and External Relations Council. With a development-friendly response to the global recession on everyone’s mind, and with big changes afoot in the architecture of European development cooperation, the development annex to the communiqué was subject to unusually careful reading. As we and other ODI colleagues have reported in earlier blogs on EU development policy, the Commission had made far-reaching proposals for ministers to consider. Would they meet expectations?
Working out what ministers actually agreed can be read off from the ‘Council Conclusions’. Working out how far ministers agreed to what the Commission proposed is more complex, and requires textual comparison between the Commission Communication and the Council Conclusions.
Just to understand how this process works. In advance of the ministerial meeting, the Commission will prepare a ‘Communication’, or a set of proposals. Remember, the Commission is not a civil service body, but a political body with a civil service infrastructure: the Development Commissioner is a politician. Politically speaking, the Commission is going to judge how to pitch its proposals: perhaps low, in order to avoid being tasked with more to do; perhaps high, to build its profile and further strengthen European mandates. In the development field, where responsibility is shared between the European Union and the Member States, a typical stratagem is for the Commission to list things it would like Member States to do and be held accountable for, knowing, usually, that the Member States will tell it to mind its own business. Commission staff often complain that they are accountable to the Member States, but that the reverse does not apply.
What happens next? Civil servants from the Member States, led by the country which holds the rotating Presidency (in this case, the Czech Republic), prepare a draft text for Ministers. The draft Council Conclusions can draw on the Commission text, amend it, strengthen it, weaken it, whatever. In principle, the ministerial text might look exactly like the Commission Communication – or nothing like it at all. Then Ministers get their hands on it, and a further round of revisions may take place.
In an earlier blog, Simon described the Commission proposals as ‘balanced and far-reaching’. There were 28 concrete proposals, covering: the volume of aid and other finance; aid effectiveness; social protection; sustaining economic activity; revitalising agriculture; investing in green growth; stimulating trade and private investment; economic governance; trade; and global institutions. If nothing else, Simon concluded, “that’s a pretty good list of topics, covering the same kind of territory that ODI laid out in its Development Charter for the G-20. It will be a pity if the proposals are watered down, or if the package is adopted selectively.”
Mikaela has carried out a detailed comparison of the Commission’s 28 proposals and the Council’s conclusions. Of the 28, 23 survive in the Council Conclusions.
First, on overall aid volume, the Commission called on Member States to honour their individual and collective commitments and stated that a resolute effort is needed this year. The commitments agreed in 2005, it will be recalled, are 0.51% of GNI by 2010 for the EU’s 15 wealthiest Member States (with a collective EU target of 0.56% of GNI by 2010), as an intermediate step to achieving the UN target of 0.7% by 2015. For Member States which joined the EU after 2002, the target is 0.17% of GNI by 2010 and 0.33% of GNI by 2015.
In response, the Council ‘reaffirms its commitments to achieve its ODA targets’, but fails to state in the main text what the targets are. Instead, a footnote quotes the May 2005 Council Conclusions. This is a small but significant weakening, perhaps not surprising in the light of aid cuts in several member states, actual or planned.
The Council ‘encourages Member States concerned to work on national timetables, by the end of 2010, to increase their aid levels within their respective budget allocation processes, towards achieving the established ODA targets.’ However, by the end of 2010, the deadline for meeting the 2010 commitments will already have passed.
Second, the Commission made significant proposals regarding the front-loading of aid, to help developing countries cope with the crisis. The proposals included €5.5 billion of resources for African, Caribbean and Pacific (ACP) countries, €25.8 billion of other external mandates, and €800 million of the €1 billion Food Facility. Budget support is seen as a key instrument for quick disbursement. The Commission also wanted Member States to increase contributions to the EU-Africa Infrastructure Trust Fund and to the Global Climate Change Alliance.
The Council Conclusions provide qualified support for the principle of front-loading, but without figures and with markedly less enthusiasm for budget support. It suggests that budget support should be ‘subject to a case by case assessment based on transparent criteria and risk management procedures’.
Third, on improving aid effectiveness, the Commission proposes that the Member States should work together with it to prepare individual action plans for implementing the Accra Agenda for Action commitments. In response, the Council affirms the importance of the AAA and identifies four areas in which ‘the Union can really make a difference’: division of labour, use of country systems, predictability of aid and mutual accountability for results, including reduced conditionality. However, it is less positive on the idea of working together with the Commission: ‘while underlining that such actions fall under the responsibility of each Member State, [the Council invites Member States to further discuss and work together in] the preparation of individual action plans, outlining actions to remove, where possible, technical, legal and administrative obstacles to aid effectiveness.’
Fourth, and with an eye on a collective EU approach, the Commission proposes developing a series of codes of conduct on global and vertical funds, on the use of country systems and on technical assistance. In response, the Council again takes a more qualified approach, suggesting ‘identifying other issues where the implementation of aid effectiveness commitments would be better pursued through collective action of Member States and the Commission.’ This wording may, however, provide a green light for the Commission to prepare proposals for new codes of conduct.
Fifth, on ‘protecting the most vulnerable’ through targeted social protection measures, the Commission declares that the Member States should follow its lead and ‘support developing countries’ targeted actions to cope with the direct social impact of the crisis through the creation and strengthening of social safety nets, facilitation of direct cash transfers and enhancement of in-kind transfers.
Sixth, on innovative financing for climate change, the Commission calls on Member States ‘to use part of the revenues from auctioning emissions allowances, as agreed in the European Emissions Trading System legislation for, amongst others, climate adaptation measures, afforestation, reforestation and technology transfer in developing countries that will have ratified the Copenhagen agreement’. The Council remains silent on the issue on this occasion.
Seventh, on governance and stability, the Commission categorically states that it will, ‘in 2009, in the context of the Mid-Term Review and the Governance Initiative, make economic and financial governance a key issue in its political dialogue with partner countries’. The Council, for its part, takes a different line. It cites the key development principles of ‘participation’, ‘ownership’ and ‘partnership’, encourages developing countries to elaborate national development plans in consultation with civil society and the private sector, and suggests that the Commission and the Member States should ‘review their respective development cooperation programmes and activities on the basis of partner countries’ priorities’.
The Commission’s five proposals that the Council does not respond to are: possible macro-economic assistance to the European Neighbourhood Policy countries, accession and pre-accession countries, in exceptional circumstances; for the EU to push implementation by the wider donor community of ‘results-based conditionality’; for the Member States to use part of the revenues from auctioning emissions allowances for climate adaptation measures, afforestation, reforestation and technology transfer in developing countries; support for the Global Energy Efficiency and Renewable Energy Fund; and an increase in export credit.
The detail of the Commission’s proposals will now be discussed amongst civil servants from the Member States in Council working groups where the figures and procedures will be negotiated. The European Parliament will have no say on any matter relating to the European Development Fund (the fund worth €22.7 billion which is based on voluntary contributions from the Member States for the Africa, Caribbean and Pacific (ACP) countries), and that includes the Commission’s proposals for frontloading aid to the ACP.
There are, of course, other issues relating to the crisis on the agenda, including trade. As our colleagues Alison Evans, ODI Director, and Dirk Willem te Velde, Director of ODI’s work on International Economic Development, have emphasised, the EU needs to act as one in wider development fora, like the G8 and the G20.
As far as this particular package is concerned, the process reflects the complex interplay of forces and interests between the Commission and 27 Member States. There was progress on some items, not on others. The proof of the pudding will be in the eating: whether aid pledges are met, whether significant front-loading takes place, whether new codes of conduct are developed and whether the EU plays straight with developing countries on climate change. Next stop: the G8!
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