Premature donors? The new EU member states and development assistance

1. School of Politics and International Studies Premature donors? The new EU member states and development assistance BalázsSzent-Iványi, Marie Curie Fellow DSA AnnualConference, 3 November 2012, London

2. New EU/OECD donors? • We do not like the term ‘emerging donors’. China and other emerging donors are doing a lot of harm, and we do not want to be grouped with them. If you need labels, call us ‘new EU/OECD donors’ (senior MFA diplomat from a Central and Eastern European country) • So, what are these ‘new EU/OECD donors’like? Are they really closer to EU/OECD donors than to the ‘emerging donors’? • Structure of the presentation: • Origins of new CEE development policies • Too soon? • Aid quantity, allocation and quality • Conclusions

3. Origins of CEE international development policies • The Central and Eastern countries all had ‘international cooperation’ policies during the Communist period • These were more or less suspended after 1989, and the CEE countries turned from being donors to recipients • No systematic development policies during the 1990s • The creation of bilateral development policies and the necessary institutions was a requirement during the EU negotiations • Technical assistance from the UNDP and CIDA • New development policies launched between 2001 and 2003

4. But… have they become donors too soon? • Are they economically ready to be donors? • As they classify as high income countries, the answer must be yes. • Socially? • Self perception of societies is that they themselves are poor, and awareness of development issues is low... the answer is most likely no. • Politically? • It seems that the politics is slow to graps the uses of aid. • Politicians see aid “difficult to justify to the public”. • “Don’t have any illusions. If the EU didn’t require us to do development policy, we wouldn’t be doing it. The returns are just too small” (senior Hungarian MFA official) •  “premature donors”? • All these dilemmas are well illustrated by the quantity, quality and allocation of CEE bilateral aid

5. Aid quantity • Rising powers? Total ODA from the EU-10 is only around $1 billion per year… • The EU target for 2010 of 0.17% was not met by any country. The 2015 target of 0.33% seems extremely unlikely.

6. Aid allocation and quality • Allocation • Primacy of the ‘neighborhood’: West Balkans and the former Soviet states • Countries in Africa or LDCs are only marginal recipients • Those ‘non-neighborhood’ countries that do receive aid are often ‘inherited’ partners from the pre-1989 development policies (some path dependency therefore still exists) • Quality • In short: the CEE countries are very far from meeting the aid quality requirements of Paris/Accra/Busan or the EU (soft) acquis • Main shortcomings: bilateral aid is highly tied, no program-based aid, single year commitments, no country strategy papers, not involved in joint programming, policy coherence not an issue at all, no usage of country systems, organizational inefficiencies • But, many argue that meeting such requirements is too costly with so low levels of aid

7. Conclusions • A new face of donorship or just the beginning of the road? • If we do consider them new EU/OECD donors, they have most in common with donors like Italy, Greece or Portugal • Is international socialization by the EU, OECD, UNDP and others working? • Do the CEE countries have anything special to contribute to the global aid system? • ‘Transition experience’ – but, is it relevant for developing countries, and is it transferable? • Regional expertise?

8. Thanks for your attention. b.szent-ivanyi@leeds.ac.uk balazs.szentivanyi@uni-corvinus.hu