Trust is the most precious ingredient in intergovernmental affairs. In its presence, even the most hardened adversaries can find ground rules for working alongside each other. But in its absence, all bets are off. Collective problem-solving grinds to a halt. Recriminations trump analysis in the face of complex policy issues. Reasonable diplomats are left to feel like they are swimming in political molasses. This truism is all too apparent amid current negotiations focused on the major development financing conference scheduled for July 13-16 in Addis Ababa, Ethiopia.
Over the next few weeks, 11 European countries can help foster global trust where it is needed most. The biggest current stumbling block revolves around how to make credible international commitments, since so many have been broken in recent years. At a technical level a combination of policy and institutional breakthroughs are needed across global, regional and national scales. All parties recognize that aid forms just one key piece of a global puzzle, commonly described as zooming out “from billions to trillions” of required investment. They also know that each country’s domestic revenue generation is paramount, as is expanded private investment.
But negotiations around the big puzzle are hamstrung by two simple conundrums. One is that donor budgets, averaging 0.29 percent of aggregate income, remain starkly inadequate for the public investment needs at hand, especially in the least-developed countries. Another is that many of the world’s wealthiest and most influential countries have simply abandoned their own recent promises.
The EU-15’s historic 2005 pledge
Most poignantly, in May 2005 the “EU-15” countries established momentous timetables to each achieve, by 2015, the international target of 0.7 percent of national income as official development assistance (ODA). Four of the 15 countries—Denmark, Luxembourg, Netherlands, and Sweden—had long already met the benchmark, as had Norway. The heft of the EU pledge came from large economies like France, Germany, Italy and the United Kingdom. They offered a stark contrast to the remaining six OECD donor countries that did not set 0.7 percent timetables: Australia, Canada, Japan, New Zealand, Switzerland, and the United States.
At the time I was helping to coordinate the global Millennium Development Goal effort at the U.N., where the EU pledges landed as a seismic contribution. They fueled a series of seminal global policy breakthroughs over the course of 2005, including those consolidated in the famous G8 Gleneagles commitments and the U.N. World Summit outcome.
Fast-forward 10 years and progress has been mixed at best. Finland has made steady progress, climbing to 0.6 percent as of 2014. Ireland and Spain initiated a few years of positive increments toward 0.7, but then reverted after their economies were hit severely by the global financial crisis. Other countries like France, Germany, and Italy never conveyed any serious intent of following through. And in 2013, the Netherlands actually quit its long-held adherence to the 0.7 percent standard.
The bottom line is that only one of the new pledging countries has properly fulfilled its promise: the United Kingdom. That country’s inspiring follow-through undermines any argument that rich countries must balance their books on the backs of the world’s poor. To varying degrees, the other 11 countries simply failed to deliver: Austria, Belgium, Greece, Italy, Ireland, Finland, France, Germany, Netherlands, Portugal, and Spain. Together this group could be dubbed the “Broken 11”—they all broke their explicit promise to support humanity’s most marginalized people.
The current stalemate on aid pledges
When advanced economies’ high-profile commitments are exposed as unreliable, they imperil global problem-solving. The same countries become reluctant to make any new promises and their assurances are difficult to trust in any case. Intergovernmental dynamics descend into a chicanery of “we pretend to promise and you pretend to believe us.” The contortions distract everyone from tackling other important problems at hand.
Most U.N. diplomats agree the 0.7 percent target must be globally reaffirmed this year. As both a principle and tactic, developing countries won’t let high-income countries ignore their past promises. But what does that mean? No developed country that hasn’t already achieved 0.7 has serious plans to deliver. Germany recently announced important aid increases over the next few years, although finance minister Schäuble said they will stay fixed at 0.4 percent—nowhere near enough to break the long-term global stalemate.
In the lead-up to the Addis conference, the implication is not to avoid commitments, but instead to clear the air for sober-headed new commitments. Back in 2010, my colleague Homi Kharas showed that countries that made pledges made greater average increases, even when falling short of targets. Today, the six countries that avoided timetables still remain in essentially the same place on ODA as a decade ago, aside from Switzerland’s gradual long-term advances.
Clearing the air to move forward
Only serious timetables and delivery targets will reboot the global development conversation in 2015. A process of forthright reconciliation is required to end the geopolitical hangover. Individual relationships heal after a strain if the offending party conveys contrition and signals the possibility of a better future. Countries and the people who represent them are no different. In the presence of forthrightness, trust can be rebuilt.
To restore credibility, the first step is for the countries that broke their promises to take responsibility for their mistakes. They can do so on the tenth anniversary of their 2005 pledge, at the May 26 EU development ministerial, and then again when leaders gather at the European Council in June. They can release diplomats from mousetrap debates over yesterday’s words, and refocus serious attention on the complex big agenda at hand.
These 11 countries can begin through one simple act. Prior to Addis Ababa, they can show global leadership by example. They can start with a formal apology.
For the first time, a major economy is saying: We will be better off doing things by ourselves, and making our own decisions. And that's a bit of a shock to the system.