World Bank calls for EU to focus on tangible aid goals

Date: 21/06/01

By David Cronin

THE EU's development aid programmes need to be more focussed on achieving tangible reductions in poverty, a leading World Bank economist said this week.

Paul Collier, the bank's director of economic research, singled out Stabex, the Union's scheme for stabilising the export earnings of African, Caribbean and Pacific (ACP) countries, for particular criticism.

The scheme was ended last year, following reports that it was plagued by inefficiency; one such example was how finance earmarked to help Uganda cope with the collapse in world coffee prices in 1989 didn't reach the country until the mid-1990s, by which time prices of the commodity had stabilised.

Tomorrow (22 June), Collier will outline the findings of a major new study on reforming international aid to Africa at a Brussels seminar. Among the weaknesses it identifies in previous efforts are "the callous neglect by the EU bureaucracy of the importance of good local administrative resources" to oversee how money earmarked for Ethiopia has been spent. Poor targeting has resulted in only half of all grain allocated to its needy households being distributed, the study adds. Despite these complaints, Collier acknowledged that the EU is "rising to the challenge" of working to improve its programmes.

Much could be learned, he said, from the radical surgery to which the development plans of some member states have been subjected.

Dutch Development Minister Evline Herfkens has won plaudits, for example, for enabling her country to streamline its efforts in the past few years, scaling back the number of beneficiary states from 83 to 17, so that more energy can be channelled into countries with the highest levels of poverty.

But Collier said he was concerned by the "highly emotive" nature of the campaign for Third World debt relief championed by rock stars such as U2 singer Bono. "There is a danger that this is becoming something of the language of the street, rather than leading to serious evaluation of how poverty can be reduced. "We could also see resources getting diverted into debt reduction, and away from other forms of aid. "If that happens, then the impact of policies would be reduced. "

The EU's development aid programmes need to be more focussed on achieving tangible reductions in poverty, according to a leading World Bank economist.