Michel seeks to synchronise EU aid effort

By David Cronin

Date: 24/03/05

Louis Michel, the commissioner for development and humanitarian affairs, has urged the EU to adopt a development co-operation strategy "just as there is a common strategy for security". In an interview, Michel exposed his plans, to be launched soon, to improve the co-ordination of aid programmes run by the European Commission with the bilateral schemes run by the 25 EU governments.

He said: "The big question is European efficiency. The challenge is to know if we are capable of acting in a co-ordinated manner or if we will continue with our 26 co-operation programmes, each in our own corners."

The EU executive is to adopt a package of measures on 12 April, aimed at offering a greater contribution from Europe towards realising the UN's Millennium Development Goals of halving the rate of abject poverty in the world by 2015.

The former Belgian foreign minister also envisages having groups of countries pooling their aid activities on behalf of the Union. Britain, for example, could use the expertise it has gained in promoting education in poor countries by leading EU projects aimed at increasing school enrollment, leaving the door open for other member states to join its activities.

Michel's remarks echo the frustration expressed by many recipient countries about the plethora of rules and procedures they have to follow to draw down aid from different donors.

For some middle-income countries, such as many in the Caribbean, he advocated that all aid, bar that of a purely humanitarian nature, should be in the form of direct budgetary assistance to their governments. Although he said monitoring is necessary, he views the current system where EU officials have to 'micro-manage' a range of small projects as too bureaucratic.

Michel is also to outline steps that EU governments should take to raise their aid budgets so that they meet the target of allocating 0.7% of national income to fighting poverty by 2015. While that target was set by the UN in 1970, the only EU countries that have reached it are Luxembourg, Sweden, Denmark and the Netherlands.

Michel advocates that an interim 2010 target of 0.5% should be set for the 15 'old' member states and 0.17% for the ten countries that joined the EU in 2004.

He said he was sympathetic to the British government's suggestion that aid should be doubled by raising additional cash on the world's capital markets, as well as to the Franco-Brazilian plan for a tax on weapons sales. "We are looking for [an extra] $65 billion (€50bn per year) for development. The trade in weapons is worth $3,000 billion (2.3 trillion euro). So we have the financial means, what we need is the political will."

Michel Camdessus, advisor on Africa to French President Jacques Chirac, said that he expected the British plan - known as the international finance facility (IFF) - to go ahead, despite America's unwillingness to get involved. The UK will seek support for its launch when the Group of Eight (G8) of top industrialised countries meet in Gleneagles, Scotland, in July. Under the IFF, rich countries would make pledges for increased aid and then use them as collateral for bonds on the capital market, with the resulting money used to fight poverty.

"The Americans tell us their legislation makes it impossible [for them to back the IFF]," said Camdessus, the former managing director of the International Monetary Fund. "That's a pity of course. But we can do it without them.

"The facility is structured so that you need a few countries to get the threshold of credibility and effectiveness. But you don't need the whole universe."

European Commissioner for Development and Humanitarian Aid, Louis Michel has called for an EU Development cooperation strategy including improved coordination of aid programmes run by the European Commission with the bilateral schemes run by the 25 EU governments.