Global Governance and

the Politics of Aid…in a post-Aid World

DAVID HULME

UNIVERSITY OF MANCHESTER

WWW.BWPI.MANCHESTER.AC.UK

WWW.EFFECTIVE-STATES.ORG

WWW.MANCHESTER.AC.UK/IDPM

Introduction

Introduction

• The Palais helped me with the vast canvas• The actors and processes have changed so much…is the

G20 displacing the UN General Assembly?• In this presentation:

– Explore some key concepts– Identify key actors and evolving processes– Argue that we need to get aid in to perspective– Avoid paralysis by analysis– Link practical actions to strategic change

• Biases – Development Studies; Bangladesh and the UK; chronic poverty; national governance (ESID); looking at the evolution of the MDGs and SDGs – not finance or conflict

Key Concepts – Global Governance

• Globalization of the 1990s – Laurence Finkelstein (1995) “[Global governance] is virtually everything..we say ‘governance’ because we don’t really know what to call what is going on”.

• Tom Weiss (2010) “Global governance should perhaps be seen as a heuristic device to capture and describe the confusing and seemingly ever-accelerating transformation of the international system”.

• New international actors – G 20; new states; social movements; NGOs and CSOs; the private sector; hybrids (GAVI etc).

• Changed forms of authority and delivery of public goods (peace, development/poverty reduction, environmental services, sustainability).

• A shift to a world of multi-tiered ‘partnerships’ –local, national, regional and global.

Key Concepts - Aid

• Official development assistance (ODA)

• OECD - flows of government resources that:– Go to low-income or middle-income countries

– Are primarily intended for development purposes; and

– Are highly concessional – at least a 25% grant element

• Big changes – China’s FAGIA (foreign aid and government-sponsored investment activity) and philanthrocapitalism

• Aid….or Finance for Development (FFD)?

Key Concepts - Aid

• Around 2000 ‘donors’ became ‘development partners’…claim a shift from ‘conditionality’ to ‘national ownership’

• Leadership contestation between the World Bank/IMF (market-led growth) and other UN agencies (human development) over aid flows and use has weakened

• Aid is strongly influenced by the domestic politics of donor countries - evolving mixes of self-interest and Lumsdaine’s ‘moral vision’ (Lancaster)

• From ‘aid architecture’ to ‘aid ecosystem’ (Kharas)?

OECD’s DAC – the Old Boys Club Expands

Membership

1961United StatesBelgiumCanadaFranceFranceGermanyItalyJapanNetherlandsPortugalUnited Kingdom

2014United StatesBelgiumCanadaFranceGermanyItalyJapanNetherlandsPortugalUnited KingdomAustraliaAustria

Czech RepublicDenmarkEuropean unionFinlandGreeceIcelandIrelandLuxembourgNew ZealandNorwayPolandSlovakiaSloveniaSouth KoreaSpain Sweden Switzerland

OECD’s DAC Today

• Domestic politics is driving many countries to reduce aid volumes and merge aid agencies with foreign affairs – Australia, Canada, Netherlands, New Zealand etc.

• Priorities – poverty, aid effectiveness, results, VFM…the lie of ‘science’ of international development

• Many donors interested in political economy analysis (PEA)…but, do not share this with their citizens!

• What does historical PEA reveal? Golden thread of ‘all good things come together’ or ‘sequencing’ or multiple paths?

• UK domestic politics are different….global cheerleader• South Korea…..we want to be a cheerleader too!

New Kids on the Block…BRICs and BRICS

• BRICs….BICs….now BRICS

• NDB and CRA challenge WB and IMF

• Porto Allegré 2014 as the ‘new’ Bretton Woods?

• China (and B,R,I,S) will not accept the US Congress’ go slow/go nowhere approach to WB/IMF reform

• Politics of international inclusivity empowers South Africa…and weakens NDB and CRA

• A casual acronym empowers Russia!

Emerging Powers

• China – group leadership, mega-bilateral FAGIA and AIIB (UK falls out with US)

• India – dozing giant…dozy giant?

• Brazil – strategic engagement, public and private…lead player in promoting Latino ideas/alternatives

• Russia – ‘we don’t care a ****’ (tell me I am wrong)

Emerging Middle Powers

• MINTS….Next II…and more – regional players?• Mexico – shackled by its relationship to USA• Indonesia – neglected by UK/European/US

academics…and politicians?• Nigeria – needs a great act of the imagination• Turkey – actively pursuing intn’l development -

government, business and civil society• Arab states – a blank in my thinking….UAE

achieves world leading 1.25% of GNI as aid in 2014…supporting Egypt

Civil Society – Social movements, CSOs and NGOs

• Confession – never quite got my head around global civil society…..

By Michael Edwards & David Hulme

By Michael Edwards & David Hulme

By Michael Edwards & David Hulme

By Michael Edwards & John Gaventa

• Still struggling on….• Banks and Hulme and Edwards NGOs, States, and

Donors Revisited: Still Too Close for Comfort?• I think development NGOs and NGO coalitions have

become wonderful global lobbyists – Beyond 2015, Participate

• Much less effective at social mobilization …GCAP• Reflects the growth of public benefit NGOs over

membership-based CSOs?• Michael Edwards – “it’s the aid stupid”.

Donor/recipient hierarchies not relationships

Civil Society – Social movements, CSOs and NGOs

Mega-philanthropists and Philanthrocapitalism

• Another important change in the pursuit of international development…and global governance

• The Gates Foundation with US$ 42.3 billion is a substantial addition to the volume of aid (but, not so much for FFD)

• New resources may be welcomed – but, concerns about undue influence and types of influence

• Undue influence – Minister of Health Uganda: “…you need to ask Bill Gates”

• Approach of new philanthropists – business methods and metrics–Michael Edwards “…empowerment and social transformation?”

• A justification for global inequality….global charity as redistribution• Evolution of a global development celebrity elite – Bono, Clinton,

Gates, Ibrahim, Jolie - trivialise and depoliticize development

Business and the Private Sector

• In the background – the puppet master hidden behind the stage?• Seen as essential for international and national development –

“growth” and “jobs”• As a direct player – public private partnerships (PPPs) such as the

Global Fund, GAVI• As a charitable player through charitable work and/or corporate

social responsibility• The all-important UN ‘Global Compact’ seems to have stalled• But new forms of operation – RED’s credit card encourages wealthy

people to reduce poverty by increased consumption of luxury goods…support a ‘capitalism as usual’ project…and inequality

• Barclays £10 million to Banking on Change with CARE and PLAN…as the LIBOR scandal emerged

What does all this mean?• Opening paper…the answers become clearer tomorrow

afternoon….. perhaps?

• Analytically – the complexity and speed of change challenge grand narratives……. Robert Cox as the way forward?

• Emotionally – optimism…global governance is no longer dominated by the Global North; many global indicators are positive (growth, human development, even violence); low income countries have more choices about finance and policy….

….pessimism…inequality is rising, business as usual capitalism, Chinese self interest displaces US self-interest

What does all this mean for academics?

• Avoiding the ‘paralysis through analysis’ trap?

• Avoiding a focus on ‘aid’ - framing aid as FFD or international cooperation (finance, trade, technology, sustainability)

• Finding ways to ensure that practical and operational/policy work support progressive strategic change…IDEAS we promote

• How? Two illustrations

Has microfinance lost its moral compass?

http://www.epw.in/special-articles/has-microfinance-lost-its-moral-compass.html

Truly Global Poverty Rates

Martin Ravallion and Shaohua Chen 2013

Conclusion

• We have a grand canvas for the next two days

• I think we need to get aid in perspective – a small part of the process of development

• Frame debates as ‘post-aid’ or FFD or international cooperation

• Avoid the ‘paralysis through analysis’ trap –elegant critiques of “neo-liberalism”

• Craft analyses that promote ideas that have practical and strategic value