UN Finance for Development conference -
Monterrey - jump to summary of the conference key
' Always look on the bright side!'
Campaigner's can 'look on the bright side' as
both the EU and USA promise up to $12bn/a of additional aid funding!
Whilst this is far short of the $54bn/a aid needed to meet the MDGs, it
represents a significant increase in aid and could deliver five times as much
new cash / year as the Jubilee campaign has delivered so far.
Prior to the conference, the USA had been
adamant that there would be no more aid and had lobbied to block reference to
the 0.7% target etc etc. In Europe Germany led a campaign to limit any EU
commitment, with the support of Italy and Spain.
So the 'step in the right direction' in which
aid promises have been made by both USA and EU must be seen as a sign that
campaigning does affect politics. The first announcement was that EU would
increase aid significantly, the reported figures were 0.39% of GDI, which would
increase aid by $7bn from $30bn....but by 2003. see EU
Then there appears to have been almost a
comedy act, with Dubya announcing $5bn over 3 years (i.e. $1.6bn/a). To be
followed by what was claimed to be clarification which more than doubled
it. Who will ever know whether it was just Dubya getting the script wrong
or a some very fast footwork in response to the howls of protest at the
parsimony of the initial offer. The new offer is a 50% increase !! from $10bn/a
to $15bn/a see USA statement
As ever the USA aid is prescribed by onerous conditionalities, will
largely be spent on USA goods and services, but it’s a ‘small step for
Even now it's not that clear - see the
report from Eurodad below
To put this aid in perspective, Jubilee 2000
campaigned for the debt cancellation of the 52 heavily indebted poor
countries. The G7 governments only ever accepted 42 countries and although
they promised $100bn in debt stock reduction, the progress so far has seen
actual debt service payments reduced from $23bn to $21bn/a, just $2bn/a less.
From: "Eurodad" <firstname.lastname@example.org>
When a 5 billion USD increase in aid suddenly becomes a 10 billion USD rise. A
simple clarification, or the result of pressures by NGOs?
From today's WB development news:
MONTERREY: U.S. ADDS BILLIONS TO AN INCREASE IN FOREIGN AID.
Ahead of President Bush's visit to a development meeting in Monterrey, the US
administration substantially overhauled a proposal to increase foreign aid
Tuesday, doubling what the president had promised to spend to fight world
poverty in coming years, the New York Times reports.
The revision came as many officials from both rich and poor nations, while
welcoming the first commitment to increase American foreign aid in more than a
decade, criticized Bush's original plan as tepid, especially in comparison with
his much more robust commitment to increase military spending.
Officials in both Monterrey and Washington said Tuesday that the administration
now planned to increase foreign aid spending by 50 percent over three years
beginning in the 2004 fiscal year. The proposal would raise development
assistance to $15 billion, from $10 billion by 2006, the officials said, and
would not decrease it thereafter.
When Bush announced the original plan last week, he described a $5 billion
development fund that would disperse grants for anti-poverty projects. Officials
said then that the plan would increase foreign aid by 15 percent each year
during the three-year life of the fund, and they made no commitment to keep
spending more money after 2006.
While the Bush administration called the new total a clarification, it would
entail a great deal more spending than the president and his top advisers first
stated. If the foreign aid budget is to grow in equal yearly increments of $1.65
billion from 2004 through 2006, as officials said Tuesday was likely, the
cumulative increase in spending would amount to about $10 billion over those
three years, double the initial estimate. Late Tuesday in Washington, Ari
Fleischer, the White House spokesman, confirmed that the administration now
favored a cumulative $10 billion increase over three years, bringing the foreign
aid budget to $15 billion by 2006. Fleischer said the White House and the
Treasury Department miscommunicated details of the package last week.
Also reporting, the Wall Street Journal says it was unclear whether the aid
increase was the result of a botched public-relations campaign, in which Bush
and his aides undersold the generosity of their own plan, or a last-minute
response to criticism from the developing world, Democratic lawmakers and
The president is traveling to Monterrey, Mexico, this week for a United Nations
conference on development aid, and the administration wants him to arrive on a
positive note. "I welcome this clarification," said Sen. Patrick Leahy
(D., Vt.), chairman of the appropriations subcommittee that handles foreign aid.
"The need for a stronger U.S. role -- especially after Sept. 11 -- is
clear, and it is urgent. . . . Foreign aid will not solve the world's problems,
but it will make a difference, especially combined with U.S. leadership."
Meanwhile, reports Reuters, US Treasury Secretary Paul O'Neill, testifying to a
Senate appropriations subcommittee, said the US could increase its aid budget as
early as the current fiscal year, if the right measurement tests have been put
in place. "We should not rule out the possibility of beginning this idea in
the fiscal year 2003," O'Neill said. "It is not out of the question
that we should come to agreement among ourselves about the measures."
The 2003 budget has already been sent to Congress for approval with a Treasury
request for $1.4 billion for international programs, but the administration can
request supplements to it at any time. The so-called millennium challenge fund
will be tied to "clear, concrete and objective" criteria Bush has
directed O'Neill and Secretary of State Colin Powell to draft, in order to
measure economic and political reform progress in poor countries.
Bloomberg adds O'Neill said the Bush administration wants Congress to reduce
restrictions on votes that U.S. officials cast at the World Bank and IMF.
"There are 32 directed-vote mandates and over 100 policy mandates, plus
numerous reports, certifications and modifications,'' O'Neill said in the text
of remarks to a Senate Appropriations subcommittee. "I would like to work
with you rationalize and focus our mandated reports and requirements."
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