Monday, October 29, 2007

Canada's development co-operation

Canada currently delivers about $4.1 billion a year in development co-operation, or what is commonly known as 'foreign aid'. Moreover, Canadian aid has been increasing in nominal (non-inflation adjusted) terms for the last several years--as recently as 2001 Canada's development co-operation was just $1.9 billion. Nonetheless, in an October peer evaluation of Canada's development co-operation effort, the Paris-based Organization for Economic Co-Operation and Development's (OECD) Development Assistance Committee suggested that Canada's development co-operation policy lacks focus and political direction. Of course, the OECD did not say this quite as bluntly as this; it is a diplomatic talking shop. Nonetheless, the point was made.

According to the Washington-based Center for Global Development (CGD), Canada as a country scores pretty well in the CGD's 'Commitment to development index'. This index evaluates OECD countries on the basis of the size and quality of development co-operation, their openness to exports from developing countries, their policies to promote investment and technology transfer to developing countries, their openness to migration, their commitment to controlling greenhouse gas emissions, their efforts to secure peace and security, and their attempts to combat corruption. Canada is ranked 7th in the OECD. It does not score well in aid, but does do well in trade, investment and technology. It scores less well on the environment and on security, as well as migration. The countries with the biggest commitment to development, according to the CGD, are not surprisingly 'the Nordics': the Netherlands, Denmark, Sweden, Norway and Finland. It is to Canada's credit that it places in this league; the Nordics are indeed impressive donors.

If Canada is doing so well, in relative terms, in its commitment to development, why is it falling short in its development co-operation? According to the OECD, part of the problem is that the Canadian International Development Agency (CIDA) has a weak mandate and is insufficiently results-oriented. The weak mandate is reflected in the lack of a clear statement as to what is the purpose of Canadian development co-operation. This is reinforced by changing political circumstances, which result in improvised policy pronouncements, at the expense of a clear direction. Changing political circumstances are reflected in ministerial appointments; five ministers have had responsibility for CIDA over the past six years, and the average tenure of the head of CIDA over the past few years has been 18 months. This, of course, goes back to the body politic, and the transition from the Liberals, under two prime ministers, to the Conservatives, ruling from the position of a minority.

The OECD report proposes that CIDA should do what is actually already Government policy. This reflects the iterative character of such reports; the conclusions were seen by the Canadian Government long before the report was published, allowing the Government to pre-empt the findings of the report in the last Budget. In the Budget, two lines signified quite an important change in Canada's aid policy. The first noted that the Government intended to focus bilateral (country to country) aid on fewer countries where 'we will aim to be among the largest five donors in core countries of interest'. The second was the pledge to 'put more of our staff in the field, allowing us to be more responsive and make better choices on the ground'. Both these recommendations, which were made in the OECD review in October, were in the Budget in March.

In fact, the first recommendation shows the remarkable degree of consensus within the Canadian establishment about development co-operation. This is because it was under the previous Liberal-led government of Paul Martin that the first intention to reduce Canada's number of development 'partners' to 25 was announced. These countries have been receiving upwards of 40 per cent of Canada's development co-operation over the past few years, and indeed in 2006 the top 20 recipients of Canadian aid received 68 per cent of the total.

As to the second recommendation, there can be little doubt that CIDA is far to ensconced in its headquarters in Hull. Only between 10 and 20 per cent of CIDA's staff works abroad, in the field.

So: does the OECD--and the Government--have it right? Only partially. The problems with Canada's aid program are three: it is inefficient; it is distorted; and it is inadequate. Canada's development co-operation is inefficient precisely because of some of the problems identified in the OECD review: as anyone who has worked with CIDA (as I have) will tell you, it is extremely bureaucratic and inflexible. It has a culture of form filling and box checking that, in my view, demonstrates the worst aspects of the 'development industry'. However, that is only part of the problem. It is also staffed by a surprising large number of people who have little, if any, interest in international development. Many CIDA staffers are career civil servants brought in to fulfill a task. This means not only a lack of professional commitment to international development; it also means a lack of adequate preparation--or indeed understanding--for the work that they have to do. As a consequence of this, CIDA relies very heavily on a coterie of well paid consultants, some of whom are very good (I have to say that--I was one!), but many of whom are professional consultants that earn their living by securing the next contract and the next contract is secured by giving the client what they want to hear. The lack of adequate preparation is also reflected in CIDA's attachment to the latest development 'fads': it is somewhat ironic that having scaled back rural development programs for some years, with the new World Bank World Development Report 2008: Agriculture for Development, agriculture is back, and, in all likelihood, CIDA will now have to try and revive an expertise in a policy area that it neglected for decades. Finally, the lack of adequate preparation means that CIDA often plays 'follow the leader'; and in development co-operation, this means, far too often, follow the neoliberal leader.

As for distortions in the aid program, the biggest is, of course, Afghanistan. Not even mentioned in the Martin Government's list of 25 development 'partners', Afghanistan is far and away Canada's largest aid recipient, and will receive more than $1 billion by 2011. However, Canadian aid in Afghanistan is embedded within a broader discourse: defence, diplomacy and development. The aid effort in Afghanistan is very closely tied into Canada's military mission there; with the defence leg being much stronger than the other two it is totally unclear as to what exactly is the purpose of Canada's aid in Afghanistan--other than providing support for the military mission.

Finally, there is the inadequacy. Canada has committed itself to the UN target of devoting 0.7 per cent of gross domestic product (GDP) to development co-operation. Currently, Canada devotes around 0.35 per cent of GDP to development co-operation. This is where the discussion on concentrating foreign aid should be located. One of the reasons Canadian aid needs to be concentrated is because it is, in global terms, so paltry. If you don't have a lot of money, you don't have a lot of money to go round, which means you have to make strict choices--it is a very neoliberal perspective. Others of a less neoliberal persuasion might suggest that increasing the amount of money increases the choices that can be made, and that that is what is extremely important in understanding why Canada's development co-operation record in aid--as opposed to say trade, investment and technology--is not as good as one might hope.

Canada's development co-operation spending has increased for several years. Canadians are respected in the field, and have made important contributions to international development. Nonetheless, in global terms, Canada is not an important bilateral 'player' in international development. Part of this is because of inadequate resources for the tasks at hand; part of this is because of distortions caused by Canada's foreign policy; and part of this is because of inefficiencies within CIDA. These are the issues that must be sorted out by the new generation of international development activists that are emerging from the universities and from civil society.

Thursday, October 25, 2007

a new format

I have reformatted the layout of my devlog, in order to show a number of links to alternative development and heterodox economics websites. Normal postings will resume shortly; I need to write something about the new World Development Report 2008: Agriculture for Development from the World Bank.

Thursday, October 11, 2007

summer 2007 activities

The summer of 2007 was, as usual, a busy few months.

In terms of research, for most of the summer I worked on two papers. One was commissioned for Third World Quarterly , and is on the relationship between market-led agrarian reform and neoliberal enclosure. The paper is now finished, and will be published before the end of the year. The second was for a forthcoming collection entitled Gender Equality and the Millennium Development Goals in an Age of Human Insecurity, and examines the macroeconomics of the MDGs from a gender perspective. This paper is currently in its third draft; the book will come out next year. I have also done final work on a review essay for the Journal of Agrarian Change, entitled 'Land reform, rural social relations and the peasantry', which was published in volume 7 number 4 of that journal.

In addition, I was appointed to the United Nations Development Programme's International Expert Group on Gender Equality, Economic Growth and Poverty Reduction. As a result, I attended an intense, exhausting and very rewarding two-day workship at the University of Essex in Colchester, UK in June with members of UNDP's Gender Team and an impressive international panel.

Also in June I attended the annual meetings of the Canadian Association for the Study of International Development. I found this event to be an extremely revealing portrait of the state of academic international development studies in Canada. As a result of these meetings, I agreed to become Co-Chair of the Editorial Board of the Canadian Journal of Development Studies, a post that will be both demanding and important in the development of international development studies in Canada.

I have been continuing my tasks as Co-Editor of the Routledge-ISS Book Series Studies in Rural Livelihoods. As part of this role I have been busily working on my next book, which will be edited with C Kay of the ISS, and which is entitled Political Economy, Rural Livelihoods and the Agrarian Question: Peasants and Globalization.

In July I had the opportunity to act as respondent to a series of questions posed by the BBC Vietnamese service on land disputes in Vietnam, while in May I acted as a respondent for Peterborough This Week, offering my views on global inequality.

Finally, of course, as befits anyone involved in teaching, I worked during the summer on my lectures for the 2007-2008 academic year, and I hope that my future students will find the results worthwhile.

Thursday, September 27, 2007

brutal generals and dissenting monks

Brutal generals and dissenting monks

If priesthood forms an alliance with the winner of 1990 election, a 'very significant force' would be born

Penniless, devout and thoroughly dangerous.

Amid reports of mounting violence inside isolated Myanmar, that assessment now seems to be the ruling military's view of the unarmed, maroon-robed Buddhist monks leading the popular revolt against 45 years of dictatorship.

Numbering 400,000 to 500,000 in a country that is 90 per cent Buddhist, with a monastery in virtually every community, the monks in what used to be called Burma command huge respect, providing spiritual guidance and a ubiquitous role at weddings, funerals and other events in the community.

The monks are traditionally aloof and secretive, and the absence of foreign correspondents in the country makes their aims hard to read, said A. Haroon Akram-Lodhi, a professor of international development studies and Asian specialist at Trent University.

But recent reports of an alliance with the famous dissident suggest a shift in the landscape.

"This is the most surprising development if it turns out to be the case," Prof. Akram-Lodhi said.

"Together they would be a very significant force ... and the military would have to use a lot of violence."

Sixty years after Burma secured its independence, the generals running one of Asia's most repressive nations have changed its name to Myanmar, built a shiny new, eerily empty capital city 320 kilometres north of Rangoon (now called Yangon) and struggled to persuade their few foreign friends the current upheaval can be contained.

But in many regards, Myanmar's crumbling infrastructure and its 50 million impoverished, ardently religious people remain stuck in a time warp in which Buddhism remains the basis of daily life.

Thus it was hardly surprising that the army held its fire for several weeks, as throngs of demonstrators led by monks choked the streets of Rangoon, Mandalay and other cities, galvanized over a 500-per-cent jump in fuel prices last month.

"An attack on the monks is an attack on people's faith, and that's where there's going to be a lot of problems," Prof. Akram-Lodhi said.

It is thought that about 10,000 monks have been taking a role in the protests. And they know how to yank the military tiger's tail.

Dependent entirely on donations for their livelihood, the monks' recent announcement that they would no longer accept handouts from the junta struck a particular nerve, said Myint Swe of the BBC's Burmese-language radio service.

"The government wants the image they are pious and helping the monks."

Drawn from the Theravada, or southern, school of Buddhism, Myanmar's monks have long been politically active - "the worst of all" the trouble makers, George Orwell wrote in Burmese Days, his 1934 novel about British imperialism's fast-fading glories.

From the British colonial era, through to the 1988 rebellion in which an estimated 3,000 civilians died, non-violence has been the monks' hallmark.

And by every estimate, the support they enjoy is near universal.

"The country is very devout. It's also incredibly poor and unequal, and people find solace in their faith," Prof. Akram-Lodhi said.

Thursday, September 6, 2007

the sub-prime financial crisis

Summer has come to an end, and, in the aftermath of Labour Day, we can start to look forward to the autumn. Over the course of the summer, the global economic event that will most be remembered has been the sub-prime financial crisis in the US. It is an event that will continue to reverberate for some time; and yet it is not well understood. Moreover, the relationship of the sub-prime financial crisis to globalization and international development is all but absent in most commentary. Yet the relationship is key; in order to understand the sub-prime financial crisis, you have to understand its international (development) dimensions.

First, though, it is important to be clear about what the crisis in global financial markets is all about. The answer is simple: people in the US are borrowing too much. Many of the people that have been borrowing have been those that previously would not have passed a credit check--they were 'risky'. The US mortgage industry constructed a set of complex financial instruments to 'tap' this segment, and thus created a new financial market--the sub-prime mortgage. Sub-prime is a nice way of saying that the US financial system started making what Barbara Enhrenreich has called NINJA loans--'no income, no jobs or assets'. Why did people take these loans? The answer is simple: the US financial sector offered them the loans. This was not a silly choice on the part of poor households. Those who had nothing were given the chance to get a loan to buy a house, the price of which has been going through the roof, and which therefore offered the poor their first real chance of benefiting from the financial speculation that they see all around them. It was a wholly rational choice. Remember, in any financial crisis that is driven by people borrowing too much, their are two culprits: those that do the borrowing; and those that do the lending, that is to say, in this case, US finance capital. How did the crisis get out of hand? Intermediaries between borrowers and lenders encouraged both to undertake speculative investments, so that they could rake in their commissions.

Why did the crisis break? Simple. You are given a mortgage at a low ('sub-prime') interest rate for a year. You take it, hoping that you will be able to pay your mortgage once the temporary low interest rate is removed. However, when the interest rate rises, and you don't have the cash, you start to have problems meeting your interest payments. One in 7 US homeowners with sub-prime mortgages failed to keep up their payments during the second quarter of 2007 and 619000 mortgagees face repossession. Multiply this more than a million times--some 6 million US households, or 2.5 million people, are in risk of mortgage default when their interest rates are reset in the next 18 months, sitting on debts of US$1,000 billion--and all of a sudden there is a US debt crisis. The onset of the debt crisis frightens the banks, who immediately want to sell the claims they can make on the mortgages provided by specialist lenders, and who thus provided the foundation on which the sub-prime mortgage market was built. In the debt crisis, then, there is, by the financial institutions, a 'flight to quality': that is, they want to sell risky high return assets and buy safer, lower return assets.

Why then has the sub-prime financial crisis gone global? How did 'contagion' take place? The answer is that the sub-prime financial crisis is the mere tip of the iceberg--the global financial crisis runs far, far deeper. In order to understand the global dynamics of the sub-prime crisis, it is important to ask: how has it been the case that US households have been able to incur such massive debts? In the world of global finance, someone, somewhere has to be providing the money that temporarily allows people and countries to spend more than they have. Where, then, is this money coming from?

There is, globally, a glut of savings. In Asia in particular, but also in parts of Latin America,
peasant farmers, urban workers, street vendors and sex workers, amongst others, are saving large proportions of their incomes, because they have no security for the future . These savings have flowed, through financial intermediaries like banks, insurance companies and the like, from China, Brazil, India and other countries to the US, as non-Americans buy US assets at an historically unparalleled rate. In other words, capital from around the world has been flowing into the US, financing the purchase of assets that allows US banks and other financial intermediaries to lend on to groups within the US that are also spending more than they earn. Pay-day loans, rent-to-buy furniture, easy credit cards with exorbitant interest rates--US financial capital has been increasingly seeking to lend money to those who could least afford to pay the interest because money has been flowing into them from the developing world. They have done this is in the knowledge that the US government will not allow the US financial system to fail should poor borrowers default: it will, if necessary, bail out financial capital threatened with default. Thus, when Long Term Credit Management threatened default, Wall Street made sure it was bailed out; and this would happen again. Thus, no one does not expect that the US Federal Reserve, the US central bank, will not to cut interest rates, because this will shore up over-extended US finance capital. A rate cut is inevitable, will lower the cost of borrowing and lending, and thus benefit overstretched US finance capital.

Global financial crises are always about excessive credit being made available to borrowers, followed by a speculative splurge, falling prices, default and hysteria. This one is no different. Nonetheless, it is important to be precise and clear about the details of this crisis. Poor farmers and dispossessed workers save; their savings flow to the US; this helps US finance extend credit to poor people who cannot pay; they are unable to pay; and the Federal Reserve steps in to ensure the viability of global finance, US banks, and the US economy. The fact is, though, that poor US households need jobs, not credit, in order to be able to buy; that peasant farmers and dispossessed workers in developing countries need security that their savings, unfortunately, do not secure; and that global finance capital needs to be disciplined, so that its excesses, which are so recurrent, do not continue.

Tuesday, August 21, 2007

humanitarian intervention after Iraq

Readers of this weblog will know that I was deeply hostile to the invasion of Iraq, that I remain staunchly opposed to its conduct, and that I foresee that the eventual US defeat in Iraq will herald a reconfiguration of global forces on a scale not seen since the US defeat in Vietnam. However, it would be a mistake to equate my opposition to the war in Iraq with an opposition to militarily intervene in the affairs of another country. One of the outcomes of the disastrous US/UK intervention in Iraq has been that it has once again forced people such as myself, who are basically pacifists, to clearly elaborate when and where there is a need for military intervention by the international community.

That the international community has an obligation to intervene in cases of humanitarian catastrophes was brought home to me during the Balkan Wars. Raised on stories of World War II, and deeply doubting Gandhi's believe that non-violence could have defeated fascism, these wars I found deeply debilitating on a personal level: genocidal conflict was raging in Europe, once again, less than 2 days away by car, and yet there seemed to be nothing that could be done to either stop it or indeed contain its spread. I will never forget asking John Loxley in 1992 what he thought should be done; he was, as ever, extremely clear: 'I think Thatcher is right; we need to bomb the hell out of them'. At the time, I was opposed to international intervention in the Balkan Wars, and yet it is true that the wars continued, ferociously, until the US started dropping bombs on the Serbs. Once that happened, the Serbian government, the sponsor and orchestrator of the Balkan Wars, quickly embraced negotiation, and the Dayton Accords were the result.

Long before the invasion of Iraq the former British Prime Minister, Tony Blair, made a speech in Chicago in which he asked a question that is of critical importance in the early 21st century: what are 'the circumstances in which we should get actively involved in other people's conflicts'? He went on, correctly, to stress that 'acts of genocide can never be a purely internal matter'. I have believed this for a very long time indeed; it was the principal reason that I supported the Vietnamese invasion of Cambodia that overthrew the Khmer Rouges. While the international community stood head to shoulder with a genocidal government that killed a third of its own population, the Vietnamese were totally ostracized for an act that saved, probably, hundreds of thousands of lives. Further back, when Milton Obote returned to power in Uganda following the ouster of Idi Amin, things started to go bad very quickly. I will never forget Tanzania intervening to overthrow Obote as a way of stopping a descent into what could have became a genocidal conflagration. I have clearly witnessed times when their is a need to citizens to support a military intervention by their government in the affairs of a sovereign state. Genocide is the starkest example; who does not want international forces in Darfur to stop the killing?

Elements within the international community have supported the need for humanitarian military intervention since the 1980s, when the then French President, Francois Mitterand, enunciated a concept that he labeled 'the right to intervene'. The problem was that this right was never codified or ratified internationally, and no one really knows when it does and does not apply.

It clearly did not apply, however, to Iraq, for many reasons. The military coup that brought the Baath Party to power in the first place was heavily promoted by the CIA. When Saddam Hussein seized control of the Baath Party there was nary a whimper from the West; indeed, when he invaded Iran in 1979 Hussein was seen to be the front line in halting the spread of the Islamic Republic, and he was rewarded by being heavily armed by the West to continue a war that he started, and which cost millions their lives. Just prior to his invasion of Kuwait he was still receiving senior Western politicians, including, for example, the then-British foreign secretary, Douglas Hurd, who came bearing arms and ammunition for a dictator that had killed his own people as well as citizens of the West. Hussein was thus very much a creation of the West: it supported him, it armed him, and it allowed him to wage war against his own people without challenging his actions.

What changed after the invasion of Kuwait was that Hussein was quickly turned into an enemy. However, rather than punishing the regime, it was the people of Iraq who were punished by more than a decade of sanctions that probably killed upwards of half a million children. Little wonder, then, that the US and the UK face such hostility in Basra and Baghdad: first, the West supported a dictator that mercilessly killed his own people; then, we by-passed the dictator to kill his people ourselves. Then we get rid of the dictator and send the military in, with the result that hundreds of thousands more people lose their lives. The West has been deeply involved in the deaths of hundreds of thousands in Iraq. And we are still doing it...

No, the war in Iraq cannot be justified. However, this does not mean that the idea of the need for humanitarian military intervention is totally discredited. What is required is a clear mandate from the international community, in the form of clear approval from the United Nations (flawed as that institution might be); a clear mandate for the UN force going in; a political strategy to remove the genocidal regime that is in place; an economic strategy to sustain livelihoods torn asunder by conflict; and an exit strategy. It requires proper resourcing, and not the begging bowl mentality that facilitated the genocide in Rwanda and the carnage in the Congo.

Unfortunately, these conditions are unlikely to find much international support after the war in Iraq comes to its logical conclusion, which is a deepening of the ongoing civil war. One casualty of Bush's war has been a strengthening of a retreat into isolationism, particularly in the US but also in the UK; and such a retreat bodes ill for the millions of people who continue to live in fear of their government.

Wednesday, August 1, 2007

smaller bombs are not the answer

The head of NATO this week announced that in an effort to shore up the faltering mission in Afghanistan NATO would reduce the size of the bombs that it was using. By using smaller bombs, the reasoning goes, there will be fewer civilian casualties, and hence less of a drop amongst ordinary Afghans for the NATO-led ISAF.

The logic is mind-blowing. That the present dilemma in Afghanistan is a man-made mistake, predictable, and will continue to deepen Afghanistan's many conflicts was foreshadowed by me in an on-line column in October 2001. That it was written almost 6 years ago is a reminder that what has happened did not have to happen as it happened. This was, to use a phrase of Donald Rumsfeld, 'a known known'.

The link to the original article, 'Attacking the Pakhtuns', is:

http://www.theglobalsite.ac.uk/justpeace/110akram.htm

Check it out.