[afro-nets] Rich countries not contributing 0.7% to ODA (3)

[Peter Burgess <Profitinafrica@aol.com>]

Rich countries not contributing 0.7% to ODA (3)
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Dear Colleagues

Thank you Claudio, regarding the percentage of GDP used for of-
ficial development assistance (ODA).

I have a basic problem with the idea that the NORTH is supposed
to be giving 0.7% of its GDP to the SOUTH. What exactly is the
reason why the NORTH is giving anything? What are the history
and the basic "economics" of this apparent right that the SOUTH
is now entitled to? Why does the SOUTH need to depend on welfare
from the NORTH? Certainly there should be lending and borrowing,
and flows of capital... and trade and labor, but I would argue
that this is part of a global economic and social system, and
not an independent "right".

The basic economic thinking about development seems to have gone
off course. It was my understanding when I was taught economics
that with the right sort of investment, and economy could be im-
proved so that it was self sustaining and able to grow from its
own internally generated wealth. But that idea seems to have
disappeared from development thinking. There seems to have been
a merging of relief and development so that sustainable develop-
ment is never going to be achieved. I reject this model for de-
velopment as being absolutely wrong and futile. But it is the
model being used by the NORTH and by most development experts.

I am very much pro-development, but the "right" based welfare
system seems to be far from the best way to proceed. The waste
that exists in donor driven welfare is tremendous, and does not
in any way serve the true interests of needy beneficiaries. I
was involved almost 20 years ago in a little study for UNDP
where the task was to identify the recurrent costs of UNDP's de-
velopment interventions! I think this is a pretty serious in-
dictment of the mindset of the NORTH experts and the development
community.

I like the idea that "ethics" should be central to economic ac-
tivity, and that value beyond just mere corporate profit should
be taken into consideration. But that is "good" use of resources
and not a "welfare" use of resources.

This past week there has been a sad tragedy in Haiti as a result
of flooding caused by a hurricane. I was a little shocked to see
a picture of brand new (Volvo I think) tractor trailers being
used by the World Food Program in Haiti - and stuck in the traf-
fic jam! Some donor I suspect got some political mileage from
making the donation to WFP.... but was it really what WFP and
Haiti needed the most. If there is just so much resource that is
available, how do you best use the resource in critical relief
work and in development? My impression is that WFP gets what the
donors want to give it, and not what is most needed by needy
beneficiaries.

Some time ago I was acting in an aid coordination capacity for a
country in Africa. Health was a priority sector, and most of all
the health sector needed money for salaries and to purchase ba-
sic medical supplies. Over the previous two years the sector had
been studied end to end by one bilateral donor organization, the
UN system and the country's own health experts. While I was do-
ing the aid coordination work the country was offered 16 addi-
tional health sector studies as the condition precedent to any
other help to the health sector. Donor foolishness at its best.

I would like to see relief and development resources totally
used to do work that results in value for beneficiaries. I would
like to see national governments in the SOUTH start looking at
their public finance and doing planning so that available re-
sources give the best development results. The NORTH should not
need to be making commitments to giving away some percentage of
their GDPs, but should be asked to commit to providing public
finance to pay for high performance development. What this is
going to mean is a lot more sovereign debt, but that is manage-
able if the underlying economy is improved substantially. The
SOUTH's debt per capita is low compared to debt in the NORTH.
The problem is that the earning power in the SOUTH is so pa-
thetic, and that is largely because the infrastructure is so
poor and "opportunity" for people so undeveloped.

What is apparent to me is that the quantity of aid is only what
determinant of development progress. Just as important is the
way it is used, and from what I am able to see we do not know
very much about what is good use of resources and what is waste
of resources... a function of lack of management information!

Written in haste... a big subject that deserves more thought

Sincerely,

Peter Burgess
in New York
Tel: +1-212-772-6918
mailto:peterb@afrifund.com
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