Country of Focus – IAR submission

IAR Submission: John Sinclair

Subject: Focus: core recommendations… and some key footnotes.

  • focus country selection should be overwhelmingly driven by pro-poor, UN Agenda 2030 policy criteria, not residual drivers from Harper-era commercial/ political motivation (e.g. Colombia and Mongolia)

 

  • focus at the country level is sound policy in development effectiveness terms. For a meaningful ODA presence and significant policy influence, a critical mass of presence, financial and human, is needed. With a likely fixed ODA budget pool, too many priority countries means sub-optimal impact, developmental and in terms of partnership credibility. [1]This might be in 2016 terms perhaps an annual[2] budget of say $50m or maybe more for a very vulnerable LDC/fragile state like Haiti or an Ethiopia. . We are a small donor and for impact we need a sustained, substantive presence, including decentralised Canadian development cooperation staff.  An optimal number of focus/core countries, based upon Canadian policy considerations, and also best practice as displayed by similarly-minded bilateral donors (notably Nordics, UK, Dutch), might be say 15-20 countries. PM Harper increased the number from 20 to 25, perhaps to give the impression of being more generous, but of course with a fixed overall budget each of them received less ODA.  He also chose to drop some small but very poor African LDCs which offered no ‘geopolitical’ gains.

 

  • Good focused development programing needs to be built around a professionally strong and empowered decentralised programming team. Canada is somewhat a laggard[3] in this approach compared to most of our peers. But this is the basis of a healthy collegial relationship with any focus country.

 

  • Under a new focus policy, a small number (10-15) of ‘other’ 2nd tier aid presence countries might be identified and provided with modest levels of bilateral aid for reasons of historic or other linkages, e.g. such to complete ongoing multi-year commitments. Of note, this has been the key political rationale for a special regional programme with the Caribbean.

 

  • One concern on focus expressed by some (e.g. CSOs, academics) is that it risks us neglecting a class of usually smaller, resource–poor countries, so-called ‘orphans’, who have no special political friends or strategic interest to big powers or other major donors. These critics suggest that a mid-sized donor like Canada might specifically focus on such countries as a sign of its ‘empathy’ – give more aid to a few relatively under-aided countries. A superior approach to the ‘orphan country’ problem is by recognising the greater effectiveness of multilateral entities such as UN agencies like UNDP and MFIs like the ADB). They are best placed to get aid to possible ‘orphan’ countries. Ensuring orphan countries are not forgotten should certainly be a responsibility for sympathetic bilaterals such as Canada, but not by direct management, but rather by using our position on the executive boards of multilateral entities to insist that they allocate money[4] /effort in this way. This means that support for ‘orphans’ is spread across the whole donor community, perhaps requiring better, increase core funding of such as UNDP or the ADB. The rare exception for a direct role might be where Canada has special historical ties, such as to the Caribbean and some other small Commonwealth countries, but these countries are not orphans but actually receive higher than average aid per capita.

 

  • To build solid partnership relations and provide predictable[5] resource transfers, a Canadian list of focus countries should be reviewed no more than once every four years/on a change of government, with a strong predisposition to continuity if the country is still low-income/LDC/fragile country. Their annual budget should be based upon commitments[6] under a mutually agreed multi-year framework.  Our programming should be based upon a mutually agreed programming framework, a partnership agreement with the recipient government. [ We might seek to encourage a role for their CSOs/local think-tanks in designing that framework.]

 

  • firm and transparent selection criteria aligned with ODAA Act principles should apply. Focus Countries selected should be predominantly (75-80%) low-income/least developed and fragile states (g7+), We should eliminate commercial or political weight in their selection.

 

  • Focus is not just a list of countries, but should involve a complementary concentration of GAC financial/ODA and human resources in designing and delivering programs. Optimally 80% of bilateral ODA might be devoted to focus countries and 80% of that go to low-income LDCs/fragiles.

 

  • Thematic focus (e.g. MNCH) is a distinct policy issue and best dealt with separately. The best practice consensus, to which Canada has always signed up, is the Paris Declaration mantra of ‘country ownership’. Canada should not be trying to impose its policy priorities on countries, exploiting the vulnerability of the poorest countries. Agenda 2030 reiterates the message of country ownership, indicating that each recipient should set the tone and content of the development relationship. We, of course, via our hopefully improved programming dialogue and decentralisation, will be close enough to them to convincingly share many of our most important insights and make them aware of our special competences. But that is fundamentally different from arriving with our plan in hand for running their The latter is old-fashioned neo-colonialism and should be passé in a quality partnership[7].

 

  • Focus countries would also be prime Canadian candidates for important non-aid policies such as trade preferences, investment, educational partnerships, etc. This is more true now than ever in a world where we see successfully developing LDCs and MICs as important longer-term trading and investment partners. It also makes good sense in a Canadian government that see major synergy gains from a whole of government

 

 

John Sinclair – Aug 2016

[1] A realistic target might be to be say the 5th largest donor to the LDCs/fragiles in our revised list of priority countries within next 2 years – it takes time to develop new programming, especially in these countries with their weaker absorptive capacity. We will need in parallel to new funding, to upgrade our field presence by greater decentralisation.

[2] Recall that a typical aid project in today’s world where programmatic aid is the developmental optimum, may have a multi-year budget of $100m.  [for large IFIs the optimum size for a 4-5 year project might be $300-500m]. The old style $10m CIDA project is not something any but the poorest of developing country governments would welcome as optimal. That size is closer to a large NGO project, a good vehicle for piloting but likely to have limited direct national impact/relevance/ substantial bureaucratic overhead costs to both donor and recipient.

[3] A major impediment to decentralization can be the discomfort that senior management in CIDA/GAC feel at having important decisions effectively taken closer to the client than to the DM or Minister. This was always a false excuse; a Minister’s input is optimally strategic, not micro-detail.  This concern is even less justified now with internet and video conferencing. The World Bank is decentralized almost everywhere now since the late-90s, after resisting board members like Canada for years. Decentralisation is inevitably modestly more expensive but there are major gains in quality, trust and effectiveness. [ click above link to separate blog]

[4] we need in parallel to ensure they have the incremental core ODA funding to carry out this task… and Canada needs to drastically reduce its past practice of ear-marking fund allocation in the UN and the IFIs

[5] Predictability is a key topic for aid-dependent LDCs. Their budget situation is often very fragile, even without a global crisis. Their programming for basic services like education and health is often very dependent on a steady flow of core funding from several donors. It is a difficult balancing act for the finance minister of a typical LDC.

[6] See separate IAR submission by John Sinclair entitled ‘A new GAC programming style for LDCs’. Our own formally one-year budget cycle does not forbid multi-year commitments.  In Canada we plan domestically on a multi-year basis with no problems and aid is a tiny % of any Canadian federal budget. If we have a financial crisis, no LDC is going to sue us for breach of contract, indeed we will likely be all getting together in the G20 for a global recovery plan. For many years CIDA had multi-year planning framework (IPFs, Indicative Planning Frameworks). These were usually shared with recipients so that they know for several years what financial support they could expect … and put into their budget planning framework. It is easy and indeed more strategic for a cabinet, theirs and ours, to plan on that basis.  It and creates stability in our own country programming and IAE budgeting.

[7] In a world where Canada is seeking broad relationship/partnerships for non-development reasons such as support via votes for a UN Security Council seat, we need trusting, respectful relationships with developing countries. Bullying is bad practice and we do not even have the relative strength to succeed in this unCanadian role.

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