Cracks in the aid architecture? Views from Toronto

With the growth of economies in the South, the ascendency of emerging economies’ companies, and the blossoming BRICS, BICS and other ‘alternative fora’, a growing literature looks at the implications of these for the existing aid architecture. Gregory Chin and Fahimul Quadir, at York University, Canada, have made an excellent contribution to this debate, in the form of an edited collection of articles on the emerging aid programs of Brazil, China, India and South Africa, and a reflection of the impact this has on the global aid regime (Cambridge Review of International Affairs, 2012, 25: 4).

This is an important and well-written contribution. The details of the changes in aid, how this is defined (usually as partnership, not aid), and how it is institutionalized in the four countries are very important, as they will and do impact international development as we know it. But having read the articles, I come to an odd and rather different conclusion from Greg and Fahimul. In a way one could argue that Mao’s China after 1978 saved global capitalism, it is equally possible that these new development will reinforce the existence of a global aid industry, rather than widening its fractures.

The basis for this hypothesis, and possible disagreement between good friends, is not a different interpretation of how the donor role of the four BRICS is evolving. Rather, it points at a different understanding, or conceptualization, of what the aid industry as it has grown since the World War is, particularly in the context of broader international politics and affairs.

Chin and Quadir, as many others, take the OECD’s Development Assistance Committee (DAC) and the Paris Consensus it has forged as the basis of what the current aid architecture is. And that’s right of course, but a reflection of what the DAC is, for me, starts to show that there is not that much special or surprising in what’s happening in the BRICS, and that their emergence may well help cement a global ‘consensus’ rather than fracture it. Let me try to illustrate this along five dimensions.

First, the DAC is an OECD organ. This is obvious, but it makes the question of ‘joining the DAC’ or not rather mute.  As much as the presence of old donors’ aid staff at the DAC is promoted by their countries’ membership of this OECD club, it is only to be expected that emerging economies’ aid staff will be less keen. At the same time, the DAC has made considerable efforts, with reasonable success, to include them, through informal means like workshops. And the DAC is constantly growing, as less-discussed new donors are joining (for example new EU members).

Second, much has been made of emerging donors’ emphasis of ‘partnership’ over ‘aid’. This is understandable from their positioning in the Global South, but the ideological differences with the practices of old donors are easily over-stated. Much of the practices stressed by emerging donors are common practices in the old architecture – technical cooperation emphasised by Brazil is an obvious example. But more important for the argument here, many old donors also for a long time have emphasised the need to go beyond the patronising aid language, and emphasise either ‘cooperation’ (as in the name of the Dutch agency) or ‘development’ (as in the case of the UK). This is not to say they have succeeded in doing so, but to stress that partnership is new neglects decades of advocacy for changes in aid.

Third, new donors emphasise the need to build on their own experience. Again, this is logical, as particularly a country like China very recently has gone – and continues to go – through a nation-defining MDG transition. But also, this is not unique: while old donors do emphasise the need for focusing on aid recipients’ needs and practices, their own national histories and political constituency continue to define to a degree where and how they provide aid. The emphasis on untying aid has been a conscious effort and advocacy for improving the way aid is given, and it would be a shame if the debate on new emerging donors neglected the rationale for it.

This brings me to a fourth point, and perhaps the largest myth, around how aid is organised. Much has been written about the way Chinese aid is organised, often driven by the hope it would set up an agency as is common in OECD countries. At the same time, much of the literature on the Paris Consensus and the need to harmonise aid across DAC countries, tend to neglect the fact that aid is very differently organised in each of those countries. This explains to some extent the lack of success in harmonisation, as aid agencies remain – rightly – accountable to their home constituency. Fact is, the way aid in China is organised may well be closer to that of the US, than that of the US is to the UK or Canada.

Perhaps the largest threat to the aid architecture, and this is the fifth point is emerging economies emphasise on economic collaboration. This has a good rationale – for the Chinese it has defined its transformation since 1978, where it actively sought international collaboration. But the history of aid in OECD countries has also shown that aid can become very ineffective if it becomes a subsidy for business in donor countries – the advocacy for untying aid was based exactly in this problem. This needs much more discussion, but my point here is that this is not going to create a large crack in the aid architecture: untying aid has never been fully implemented, and aid policies of old donors recently also are emphasising the need for economic collaboration rather than the MDG-focused untied aid.

So, the collection brought together by Gregory Chin and Fahimul Quadir is very welcome, and very well done. As much of the writing on China, which has made me have another look at my own priors of western aid, these papers too, apart from providing important insights into the (re-) emerging  donors’ practices, can make the reader reflect on international development practices more broadly. I don’t see cracks emerging, but may be, like beauty, cracks are in the eye of the beholder.