Sir,
There is little doubt that when private and public interests get together, development partnerships can have a significant role to play bringing new allies and funds into the development process. It is crucial, however, that these mechanisms do not simply become a tool to open up foreign markets, nor a means to pursue political, geopolitical, resource-related and economic interests. Their main aim should be to attract private investment instead of diverting scarce development assistance to help corporations fulfill their lucrative missions.
There is also a threat that private-public partnerships encourage the private sector to take on responsibilities that ultimately lie with the governments of recipient countries. In this regard, ‘sustainability’ is not simply synonymous with ‘economically profitable’. Certain key social services crucial to development, such as universal health and education, can only be sustainable if there is a firm commitment by governments to deliver.
Working with corporations is desirable when the generation of profits is complementary to development goals. Such mutual support is particularly welcome at a time when redoubled efforts are needed to attain the Millennium Development Goals by 2015. At the moment, there is still a huge task ahead to make substantial advances towards targets like the MDGs and too little development finance to go around.
However, it is important to keep up the emphasis on empowering civil society organisations and strengthening the role of developing countries’ governments in granting basic rights to their citizens and adopting policies that specifically target the poor. It also appears crucial to focus on the most vulnerable sectors where private interests are less likely to get involved. And, as the quantity of assistance is so scarce, we must focus on the issue of quality more than ever. Coordinating and improving efficiency of development efforts is imperative.
In this regard, the European Consensus on Development and the Paris Declaration on Aid Effectiveness are clearly beneficial. They are based on five key principles: ownership, alignment, harmonisation, managing for results and mutual accountability. In addition, the increasing use of General Budget Support assists developing countries in their struggle to achieve their own development goals and implement their own poverty reduction strategies. This is a valuable tool to foster ownership and sustainability while strengthening coordination, complementarity and coherence, which are the development cooperation principles enshrined in the Maastricht Treaty. It also has a wider positive effect on accountability and governance.
The European approach arises out of the view that governments play a decisive role in the economy and work actively to improve the living standards of their citizens, in particular where private initiatives have failed to reduce social deprivations. This perspective does, however, acknowledge that new private-public partnerships offer huge scope for more inclusive growth in areas like agriculture, where investment is badly needed at a time of international food crisis.
Last year, European citizens contributed an average of $93 each to development cooperation, 70% more than their US counterparts. The EU is the world’s leading donor in absolute and relative terms, with a ratio of Official Development Assistance to Gross Domestic Income of 0.4%, more than double that of the US (0.16%). As such, it has a responsibility to improve both the quantity and quality of development cooperation. Attempts to attract private funds should not divert our efforts away from this task.
josep.borrellfontelles@europarl.europa.eu