Week 10 Politics of international aid Development aid and development funding: International philanthropy or political gain?

What is development? What are the characteristics of a “developed country”? What are the characteristics of a “developing country”? - Even responses to these questions are steeped in politics and ideology If we are to understand development aid we need to understand what development means and that there will be different understandings for different stakeholders and that setting priorities for what is important in development is political. Ask students to describe what it is that makes a developed country – draw out differences between their responses, or whether they all have the same. Ask what perspective they answer that question from – What are the characteristics of a developing country? While these kinds of understandings - developed/ developing, first world/third world LEDCs/ MEDCs can provide a useful framework, this kind of labeling and identification is itself a political statement and steeped in an ideology about economic development and growth.

200 Countries, 200 Years, in 4 Minutes – a history of development? What is development?? 200 Countries, 200 Years, in 4 Minutes – a history of development? Inserted hans rosling clip from gapminder Click on video to activate, or access through gapminder.org Question whether the indicators of development used in the hans rosling film are valid – uses income and life expectancy as the indicators of development BUT are these these2 most valid? Hans Rosling - Gapminder.org

Development approaches, indicators, measures Economic development Social or human development A number of international and regional instruments make clear that there is a right to development and that this is intrinsically linked to the realisation of other social political and economic rights – Refer to Human rights Saturday – which set development in the context of the human rights framework – HANDOUT on the international legal framework around rights to development Work in the course so far has shown that approaches to international aid have focused on development as an issue of ECONOMIC development- raising GDP will have a ‘trickle down” effect and everyone will be better off. – as reflected in the debates Social development – ask students to suggest what is social development. ( examples contained in the handout from last week) The Human Development approach arose in part as a result of growing criticism to the leading development approach of the 1980s, which presumed a close link between national economic growth and the expansion of individual human choices. Many, such as Dr. Mahbub ul Haq, the Pakistani economist who played a key role in formulating the human development paradigm, came to recognize the need for an alternative development model due to many factors, including: Growing evidence that did not support the then prevailing belief in the “trickle down” power of market forces to spread economic benefits and end poverty; The human costs of Structural Adjustment Programmes became more apparent; Social ills (crime, weakening of social fabric, HIV/AIDS, pollution, etc.) were still spreading even in cases of strong and consistent economic growth; A wave of democratization in the early 90’s raised hopes for people-centred models. The policies of world bank, IMF, WTO – the ideological underpinnings of globalisation all start from the premise that economic development is the path to improving SOCIAL development Note that a 2010 study by UNDP found no evidence of statistically significant correlation between economic development and the HDI. The MDGs are an example of a human development approach – would someone like to share what they know about the MDGs with the class? Has anyone ever worked in a program that had one or more of the MDGs as a goal of the program? What is the HDI?

Development progress? - numbers from Bill Wolfensohn, former head of World Bank 6 billion people on the planet in 2000, 1 billion of those have 80% of the income, 5 billion have 20% Of those 5 billion, 3 billion live on less than $2 per day Of those 3 billion 1.2 billion live on less than $1 per day. And half of those are starving – they cannot feed themselves or their children. (and 1 trillion dollars in development aid in the last 50 years to get these outcomes) Bill Wolfensohn is former head of world bank 95 – 2005 – figures from abc radio interview These are crude figures with big numbers, but what they don’t say anything about is that as there are Huge disparities not only between but also with in countries. Also poses the question that if half the current population slives on less than 2 per day - Is aid working in any model of development? – - 1 trillion dollars in 50 years to get these outcomes - MOYO reference

In 1500 and 1815, China and India had 50% of global GDP In 1500 and 1815, China and India had 50% of global GDP. After world war 2 they had 1.2% In 2050, they will again have reached 50% of global GDP In 2050 (with 9 billion people) 80% of world income will no longer be with US, Europe and Japan – they will only have 35% of the world’s total wealth. In 2050 50% of income will be in China and India, 65% in Asia. Average wages will be $2-3000 per capita in Africa, $30-40000 per capita in China and India, and $80-90000 in Europe and US. By 2050 there will be 9 billion people in the world and 2/9ths of these will be living in extreme poverty. (mostly in Africa) “We cant have 2/9ths of the world population in this situation” -- Bill Wolfensohn WHY? (or WHY NOT?) At the end of outlining these statistics Mr Wolfensohn said, we cant have 2/9ths of the world population in this situation. Why? – what do students think? Discuss in small groups and each group to feedback any conclusions or reflections they reach

“People will use the inadequacies of income to stimulate problems “People will use the inadequacies of income to stimulate problems . . . [this information] will enable those of malevolent intent to stir up trouble” Bill Wolfensohn Is development aid a security issue? Political imperative? human right? Actionaid reference “Action on Rights”, People’s movement for HRE “The Human Right to Development”

Political questions for development aid Who gives what to whom, and why?- Australia’s position as Who decides what to prioritise in the provision of aid? To understand the political dimensions of aid we need to apply these questions to the giving of aid: 1. Who gives what to whom and why Largely a ‘north’ to ‘South’ transfer of resources. Some developing countries are also aid donors – how come? – can have a high GDP but perform poorly on the human development index – often countries that have a significant internal disparity of wealth Only the scandinavian countries meet the 0.7% of GDP promised Many countries are less than .1 Australia is around .12. only about one fifth of U.S. and European commission aid goes to countries classified by the OECD as ‘least developed.’”[20] This “pro-rich” trend is not unique to the United States.[20] [21] According to Collier, “the middle income countries get aid because they are of much more commercial and political interest than the tiny markets and powerlessness of the bottom billion.”[22] What this means is that, at the most basic level, aid is not targeting the most extreme poverty. Only about 40% of development aid is untied.- what is tied aid? Why do countries give tied aid? 2.Who decides what to prioritise Priorities are usually set by donors – the amount, the type, the purpose, the timings, the channels. This is responsible for a lot of criticism from the south that aid is the new imperialism

What should be a greater aid priority? Maternal healthcare or AIDS prevention? Infant mortality or universal primary education for girls? Reduce malnutrition or achieve equal representation of women in decision making? Education infrastructure (building new schools) or providing immunisation against preventable diseases? Food aid or infrastructure linking rural area to urban centre? So considering that we take a social development approach, focusing on enabling access to rights – In small groups discuss which of these is more important and present your position back to the group.

Places most dependent on development aid (US$ million) 1. Solomon Islands 66.5 2. East Timor 52.9 3. Burundi 45.6 4. Sao Tome 45.2 5. Eritrea 36.6 6. Sierra Leone 28.8 7. Congo Republic 28.5 8. Malawi 27.8 9. Palestinian Territories 27.4 10. Rwanda 26.7

Biggest givers of international aid Amount (US$ mil.) Proportion of gross national income (%) 1. United States 21,753 0.16 2. Germany 12,267 0.37 3. France 9,940 0.39 4. Britain 9,921 0.36 5. Japan 7,691 0.17 6. Netherlands 6,215 0.81 7. Spain 5,744 0.41 8. Sweden 4,334 0.93 9. Italy 3,929 0.19 10. Canada 3,922 0.28

Millennium development goals 8 goals, 21 quantifiable targets, 60 indicators Goal 1: Eradicate extreme poverty and hunger Goal 2: Achieve universal primary education Goal 3: Promote gender equality and empower women Goal 4: Reduce child mortality Goal 5: Improve maternal health Goal 6: Combat HIV/AIDS, malaria and other diseases Goal 7: Ensure environmental sustainability Goal 8: Develop a Global Partnership for Development http://www.undp.org/mdg/basics.shtml