 |
|
|
|
|
|
Global |
|||||
Press Release |
|||||
|
|
Press Release 2: A NEW DIRECTION IN THE DEBATE ON AID EFFECTIVENESS Study urges to differentiate between
Accordingly, study recommends a dual track approach to ODA (official development assistance) with
The study: Inge Kaul, Isabelle Grunberg and Marc A. Stern (eds): Global Public Goods: International Cooperation in the Twenty-first Century.
New York: Oxford University Press, 1999. New York. ---
A new study argues that the debate on aid effectiveness will go nowhere unless we clarify the present confusion on what the objectives of aid are. The purpose of aid is typically to help poor
countries achieve their development objectives, and in particular to bolster their ability to help themselves. Yet in many instances, donors may primarily seek strategic or commercial interests.
In addition, as the editors of Global Public Goods
argue, aid is increasingly used to ensure the existence of global public goods, such as environmental sustainability, global health or economic or social stability, and to facilitate policy convergence.
As much as one out of every four aid dollars
may be supporting such global objectives. "Aid" now benefits the ozone shield, global forest reserves and the protection of biodiversity; and it facilitates the coordination of policies in a number of areas – from free trade, to finance, and human rights. Aid helps build globalization. And therefore, it will often flow to the better-off developing countries, if only to stem global financial crises and turmoil, as we saw in recent years in Russia, Latin America and Asia.
Global public goods require new and additional finance The UNDP study argues that we are facing today a large and growing agenda of international cooperation and that we should separate between
"aid" and "support for the provision of global public goods." Currently, both are accomodated into an aid envelope that is shrinking. "This would be desirable", the editors point out,
"because the aid modality is often not the most effective or efficient one to use for global public goods purposes". For the latter, market-inspired mechanisms – such as pollution trading – may do a better job.
Other possible methods include making deals to apportion the production of global public goods among countries with different comparative advantages. Knowledge, equity, health, market efficiency, financial stability,
or environmental sustainability (all discussed as case studies in the book) constitute global public goods. This fact makes them comparable – even "tradable", for example: "reduction of greenhouse gas
emissions" could be exchanged for "enhanced access to knowledge or technology". Donors pay other countries to join various "networks" In addition, many global
challenges can usefully be viewed from a network perspective: the larger the network, the larger the benefits it offers to its members. Clubs have an interest in helping to qualify future members, who will
bring more benefits to the existing members. In the book,
Arrangements to provide global public goods more efficiently will involve transfers of different kinds of resources Richer countries may provide support to poorer countries to enhance the provision of global
public goods when those countries are in a better position to provide public goods, yet could not afford it otherwise. Take the case of forestry resources. It would be extremely costly to promote re-forestation,
let's say, in New York City. But if Brazil or any other countries provide that service in the global interest, the payment it receives for that does not constitute aid. Rather, it should be viewed as a payment for a
global service rendered. These transfers should not be counted as aid, but as Official Development Assistance for Global Purposes: ODA-G, as distinct from ODA-C, aid that follows a national agenda.
ODA-G accounts could finance a new, proposed Global Participation Fund, recommended by the editors in order to allow developing countries to be in a better position to engage in negotiations pertaining to the
provision of global public goods. The Fund resources should amount to an additional 0.1% of donor countries' GNP, which would be paid annually, over a period of five years. It could help expand the current work in this
area of UNDP and of UNCTAD, the UN Trade and Development Conference. What future for aid? As Zéphirin Diabré, Associate Administrator of UNDP remarks, "There are many things that markets and private
finance can do well, but there are also others that can only be supported from public funds. Therefore, we must live up to today's challenges and commit ourselves to both aid and global public goods. The world needs
both." |