DEVELOPMENT: EU Not Matching Promises for MDGs

By IPS Correspondents Reprint | | Print |

David Cronin

BRUSSELS, Jun 22 2007 (IPS) - Increases in development aid will not be sufficient to reach the United Nations targets on improving health in poor countries, a new European Parliament report has warned.

Fifteen European Union governments pledged in 2005 that they would raise incrementally the proportion of their national budgets allocated to development aid, so that it would comprise at least 0.7 percent of their gross national income by 2015. The increase was intended as the EU’s contribution to the UN’s Millennium Development Goals (MDGs) of dramatically reducing the most extreme forms of poverty.

But the Parliament’s report has found that EU aid has decreased slightly since that pledge was made if it is calculated as a proportion of national income.

In 2005, the EU-15 devoted 0.44 percent of their combined gross national income to aid, yet this fell to 0.43 percent last year.

“Clearly, the MDGs will not be reached unless the poorest developing countries receive increased and improved aid to complement their own domestic resource mobilisation,” said Glenys Kinnock, a Welsh Socialist member of the European Parliament, who drafted the report.

Kinnock’s report finds that some of the richest countries in the EU are the worst laggards. Italy, for example, is a member of the Group of Eight top industrialised countries. Yet its aid amounted to just 0.2 percent of gross national income in 2006.

All eight of the MDGs, agreed at a UN summit in 2000, relate to health and education in some way, setting targets for addressing the AIDS pandemic, reducing infant mortality and deaths of women during childbirth and achieving universal access to primary education.

The EU’s new Development Cooperation Instrument indicates that by 2009, at least 20 percent of aid should go to the health and education sectors.

But Kinnock found that less than 7 percent of EU aid is currently going to healthcare. An additional 12 billion euros (16 billion dollars) per year will have to be given to healthcare if global health spending needs are to be fulfilled.

On education, Kinnock found that the EU needs to increase its aid commitments by 5.3 billion euros (7 billion dollars) a year.

Kinnock expressed concern at how aid administered by the European Commission, the EU’s executive arm, is skewed towards large infrastructural projects, rather than to basic needs.

In 2005, the Commission’s aid to transport and other infrastructure in poor countries amounted to 817 million euros (1 billion dollars), while the respective support for education and health stood at 185 million euros (248 million dollars) and 239 million euros (321 million dollars).

“It is important that support to the transport sector should have a clear and explicit link to poverty reduction,” Kinnock added.

She also lamented how several EU countries are ‘inflating’ their aid statistics by including debt relief as official development assistance.

At present, the Organisation for Economic Cooperation and Development (OECD), the main watchdog on aid from rich countries to the poor, allows debt relief to be counted as development cooperation. “But the reality is that debt relief does not represent a transfer of any new resources for development,” said Kinnock.

Her report says that the principal culprits for massaging aid data are Austria, France, Italy, Germany and Britain. All five inflate the level of their aid by 28-57 percent.

“There are various ways that budgets can be inflated,” Rob van Drimmelen of Aprodev, an umbrella group for anti-poverty groups linked to Protestant churches told IPS. “Debt relief, aid to migrants and the costs of foreign students in Europe can be included as development cooperation. But if you correct the statistics and just look at the transfer of new resources, you will find that there has been precious little progress.”

Kinnock has advocated, too, that innovative sources of aid should be explored but that these should be additional to development assistance. The International Finance Facility championed by Gordon Brown, who will shortly replace Tony Blair as Britain’s prime minister, has raised 750 million euros (1 billion dollars) for a vaccine and immunisation initiative by the issuing of bonds, whereas a French levy on air travel is expected to bring in annual sums of 187 million euros (251 million dollars).

Vagn Berthelsen, president of Alliance 2015, a coalition of relief agencies campaigning for greater European contribution to the MDGs, suggested it would be morally wrong for governments to use innovative sources of financing as a pretext not to reach the 0.7 percent of gross national income target.

“The main thing is that governments have to focus on using taxpayers money in the way they have told them it will be used,” he told IPS. “The question of innovative ways of increasing aid is a different discussion.

“Seven years ago, the global society set key goals to achieve by 2015. If their theories are not followed up by action, then this will undermine public belief in European institutions. The European Union and its member states have to make these objectives a priority. They have to address how money from taxpayers should go to financing the MDGs.”