60 years of German development cooperation – where to go from here?

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International cooperation for sustainable development is crucial for securing life in dignity for current and future generations. In a globalized world like ours, without such cooperation, it is impossible to strengthen individual and societal freedoms for flourishing, to curb climate change and biodiversity loss, reduce inequalities in income and wealth, end armed conflicts and avoid outbursts of violence, strengthen the rule of law and accountable and effective public institutions, and shape digitalisation.

Development policy and cooperation have evolved into essential elements of international cooperation, by broadening their political agenda from poverty reduction, economic diversification and productivity towards confronting global societal challenges. Therefore, development cooperation today is an essential tool for implementing multilateral agreements, especially at the environment-society interface, and the 2030 Agenda for Sustainable Development, but also for improving social security systems, disaster risk preparedness as well as resilience against violent conflict and societal breakdown.

In the last few years, Germany has grown into being the second largest donor country, right after the US, reinforcing its status as an important partner in bilateral and multilateral cooperation. It reached the 0.7% target in 2019. But providing sufficient and growing funding obviously won’t be sufficient for making cooperation more effective, productive and ambitious.

On September 1st, 2021, we came together at the German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE) in Bonn, on the occasion of the 60th anniversary of the German Ministry of Economic Cooperation and Development. Our panel discussion focused on how development cooperation could increase and strengthen its contribution to global sustainable development in the next 60 years – and we surprised ourselves by agreeing on several points, despite coming from different continents and institutional backgrounds.

Ownership and accountability matter

We agree that a crucial step for donors to make is to respect ownership of developing countries with regard to the priorities and ways of producing domestic change. The often invoked principle of partnership needs to be translated into real and increased policy and fiscal space for developing countries to define their own development trajectory, and member countries of the Organisation for Economic Co-operation and Development (OECD) have to find ways to contribute to that by reforming their instruments and approaches, also beyond development cooperation. Policy-based lending, as offered by Germany to a select group of countries on the African continent is a step in the right direction. Integrated financing frameworks, global public investments and a more equitable global financial architecture are further steps that could improve the fiscal space of countries and strengthen their leverage in global partnerships. In trade and development policy, the EU can make progress by avoiding anticompetitive behaviour regarding African countries. This would fit very well with the European Commission’s approach of shifting from development cooperation to international partnerships of equals.

We also agree that developing countries need to engage more in ensuring internal accountability on development investment, for their own citizens and population as much as for donors, accompanied by improvements in the effectiveness of rule-based governance, and in the empowerment of people, especially women and youth.

We agreed that Germany has a special responsibility and role to play in reforming development policy and cooperation – as second largest donor, as a respected member of the EU, the G7 and the G20. The upcoming German presidency of the G7 in 2022 provides many opportunities for reasserting the role of development cooperation in a coordinated and collaborative way with other policy fields for making progress with building back better during the covid-19 pandemic, and energetically reducing greenhouse gas emissions and biodiversity loss. More specifically, Germany should use its presidency to seek for areas of collaboration or joint initiatives with the Indonesian G20 presidency, e.g. regarding support for highly indebted developing countries.

Reforming international cooperation for sustainable development

Another area where Germany’s engagement would be very welcome is the urgently needed re-shaping of the international architecture for international cooperation (including development), especially with regards to funding. Some of us mentioned the Global Public Investment (GPI) initiative as a space for elaborating new reciprocal and comprehensive models of accountability and effort sharing for the provision and funding of global public goods and their roots in local institutions, services and action. Such innovative global approaches may provide the push for change in development cooperation which, historically, promotes a discourse on its transformative potential elsewhere while at the same time showing a poor record of transformation of its own cooperation arrangements, e.g. by maintaining the strict distinction between donors and recipients, and between change occurring in the South (subject to agreements between donors and recipients) and change occurring in the North (where the North has no obligation to be accountable to the South). An inclusive model of global cooperation may facilitate dialogue and collaboration between North-South and South-South cooperation, towards multiple collaboration formats that promote a more coherent global cooperation. GPI offers a model that is based on national contributions to public goods whose benefits accrue both locally and globally, and where accountability is geared towards the global common good.

Public investment is crucial for achieving sustainable development. Thus, funding the Sustainable Development Goals (SDGs), whose implementation was already lagging behind before the onset of the covid-19 pandemic, needs a new approach. Fiscal space would benefit from increased efforts on combating tax evasion, profit shifting, and money laundering, and on reforming existing tax systems, to strengthen the fiscal contract between the citizenry and public administration. A reformed global cooperation system would probably be more effective and coherent and better equipped to mobilize private finance for sustainable infrastructures and business models which promote productivity growth and decent wages.

Knowledge for sustainability transformation

A last word on the role of research and science: They are crucial for enabling a transition towards inclusive and sustainable economies and societies, and scientific evidence should be used strategically for advising ministries in policy design, implementation and learning. More international cooperation in research and science is needed, for strengthening local research infrastructures and local knowledge generation and thus investing in the capacities of citizens and public administration for change. Effective international cooperation benefits from research and from impact evaluation to understand what works and what doesn’t, and under which circumstances.

The incoming German government includes an independent ministry of economic cooperation and development with full powers to define policies and action. With its expertise and motivation, it will be able to push forward a more effective global cooperation system that supports local action towards global public goods and makes globalisation more sustainable and equitable. The coalition treaty affirms the 0.7% target for development finance, increases in international climate finance, the elaboration of climate and development partnerships and a pro-active climate diplomacy. The treaty also states the ambition for developing a coherent strategy for the EU-Africa partnership that goes beyond development cooperation. We are eager to see how these innovations prosper!


Authors

Imme Scholz, Deputy Director, German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE)

Heidemarie Wieczorek-Zeul, Vice-President of Friends of the Global Fund Europe, former Federal Minister for Economic Cooperation and Development

Vera Songwe, United Nations Under-Secretary-General and Executive Secretary of the Economic Commission for Africa (ECA)

Andrea Ordóñez, Director, Southern Voice

Sébastien Treyer, Executive Director, Institute for Sustainable Development and International Relations (IDDRI)

Ariane Hildebrandt, Director General, Federal Ministry for Economic Cooperation and Development of Germany (BMZ)

Anna-Katharina Hornidge, Director, German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE)

 

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