Millennium Development Goals: Enhance Public Policy with Private Donors

Today, UN Secretary-General Ban-Ki Moon will convene a “high-level event” on the Millennium Development Goals (MDGs) in New York. Those attending will have to face the facts: the world is unlikely to meet most goals by 2015. Rising commodity prices threaten those gains that have been made. Donors are failing to meet their promises regarding levels of aid—they would need to double their levels of assistance over the next three years, a highly unlikely prospect. Additionally, for more than half of the world’s poorest countries, there is insufficient information to measure progress against poverty; and even when there is data, it is often both debatable and volatile.

Although the MDGs do provide some coherence to the fragmented international development industry, the rules by which they are implemented and monitored need to be reformed. In particular, the MDG effort would do well to embrace private aid donors.

Currently, private sector participants are relegated to the fringes of the international regime that supports the MDGs. At the high-level UN event, official roundtable discussions will include speakers drawn from civil society, and several so-called “partnership events” hosted by private development players, such as the Gates Foundation, will convene in parallel to the official proceedings. But when it comes to overseeing the implementation of the MDGs at the country level, these players are left out. While international and domestic philanthropies and NGOs now deliver a larger and larger share of total development aid, they are rarely included in development policy-planning meetings that are usually reserved for ministers and official aid agency representatives.

Nor will the private sector be formally represented at the Doha Conference in December to review the implementation of the Monterrey Consensus. The Doha Review will address, among other things, how to strengthen the role of the World Bank and IMF. Those two institutions disbursed $24 billion in development assistance in 2006. In the same year, US foundations, charities and philanthropies alone gave $34 billion to international causes.

Recipient countries and international organizations alike must develop formal mechanisms to include private sector actors in the development-policy making process. In turn, a seat at the policymaking table could help private players become more accountable.

In exchange for greater involvement in the country-level MDG efforts, private sector actors should develop ways to make their activities more transparent. For example, private aid players could systematically report “to where” and “for what sectors” they disburse their resources to a centralized system. Currently, this type of information is unavailable, making efforts to coordinate and harmonize development activities difficult. NGOs, charities, and foundations could also be among the rotating participants in official donor peer-reviews that occur within the OECD system.

Greater cooperation among private and official players in the MDG regime would demonstrate how the development community’s newer, fast-expanding players can contribute to progress on the MDGs, both in terms of implementation and monitoring. It would also increase the information available to poor countries about the multiple channels of assistance now available to them. If recipients could freely choose which aid is channeled through official projects or NGO providers based on this information, a healthy quasi-competition among aid donors might ensue.

Rather than focus on the shortcomings of the MDGs, the fledgling cooperation we will see in New York should be considered an opportunity for longer-term participation by new aid players.