Abstract
The European Commission (EC) launched a new aid instrument: the ‘governance incentive tranche’, to incentivise African, Caribbean, Pacific (ACP)-governments to carry out governance reforms. This new initiative fails to incorporate the principles spurred by the aid effectiveness debate, to which the EC has committed itself. This article sets out to understand the gap between discourse and practice and argues that in order to fully grasp the complexity of donor behaviour, domestic issues and political arrangements have to be brought into the analysis. The incentive tranche illustrates how the complexity of the European construction makes the formulation of a coherent policy exceptionally difficult.
La Commission Européenne a introduit un nouvel instrument d’aide, ‘la Tranche Incitative pour la bonne Gouvernance’, afin d’inciter les gouvernements des pays in French ACP à mettre en œuvre des réformes de gouvernance. Cette nouvelle initiative n’intègre pas les principes émanant du débat sur l’efficacité de l’aide, principes que la Commission s’est engagée à respecter. Cet article cherche à comprendre ce décalage entre le discours et la pratique et soutient que pour appréhender pleinement la complexité des comportements des pays donateurs, il faut prendre en compte dans l’analyse les questions locales et les accords politiques. La tranche incitative illustre bien à quel point la complexité de la construction Européenne rend difficile l’élaboration d’une politique cohérente.
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Notes
With the exception of the United States and Japan, who command large aid budgets but have not been so eager to commit themselves to the approach.
The whole EDF amounts to €22.6 billion (EC, 2006).
Important to mention is that for this study we specifically focussed on the EDF-committee and how the ECGIT set-up and implementation was influenced by interventions of member states within that committee. In order to get this information, we interviewed people from the EC but also civil servants from specific member states taking a seat at the EDF committee. However, given the very confidential nature of the EDF meetings, we were asked not to cite or refer to people or specific donor (positions).
See, for example, the recent blog posts of the Center for Global Development (blogs.cgdev.org/globaldevelopment/2010/07/what-is-the-counterfactual-for-cod-aid.php) and Paolo de Renzio (efareport.wordpress.com/2010/07/13/the-problem-with-cash-on-delivery-aid/). In this article, we will not give a full account of the debate because this would bring us beyond the scope of this article.
These highly selective mechanisms for aid allocation can or cannot be aligned or harmonised. The case of the Millennium Challenge Corporation, for example, is one of no harmonisation and no alignment. The Cash on Delivery concept on the other hand pleads for harmonisation and alignment.
Important to mention is that an additional 5 per cent can be gained by countries that have concluded the African Peer Review Mechanism. The six Portugese-speaking African countries that agreed to supplementary commitments in the cooperation with the EC in the domain of governance also receive up to 5 per cent extra. Furthermore, the special situation of fragile states is taken into account during the assessment as a corrective factor, although according to several sources they also receive a 5 per cent bonus.
These Country and Regional Strategy Papers are the end-results of the EDF programming process. They lay out the foundations of the cooperation between the partner countries and the EC. The EDF is funded directly by the Member States and is not a part of the EC budget. All decisions about the use of the EDF fund must go through the EDF committee, comprising representatives from the Member States (EC, 2008c). The EDF committee decides with weighted voting (votes per country based on size of contribution to the EDF) on the CSPs.
The intermediary score is as follows: three countries at 10 per cent, 11 countries at 20 per cent, 41 countries at 25 per cent, five countries at 30 per cent.
‘The challenge now is to bring together different instruments […] [including] the European Development Fund’ (European Council 2003, p. 13).
For example, the establishment of the European Community Humanitarian Aid Department in 1992 is regarded as an attempt to guarantee the EC more visibility in a highly mediatised activity, that is, emergency aid delivery (Olsen, 2004).
Exemplified by the use of €250 million from the EDF for the African Peace Facility (Woods, 2005; Olsen, 2007).
The EC is one of the donors often criticised for letting geographical proximity and domestic interest weigh heavily on aid allocations. The top five of EC aid recipients in 2004 included Serbia and Montenegro, Turkey and Morocco. The 2007 EC DAC Peer Review also stresses the weak poverty focus of the EC's aid allocation (OECD/DAC, 2007b).
Performance criteria are, together with indicators of recipient need, integrated into the aid allocation mechanism of the 10th EDF. This, however, concerns the initial allocation, which is allocated separately from the ECGIT.
For the same reason, Member States have voiced concerns over a possible future budgetisation of the EDF – it limits the visibility of their aid and weakens their special relationship with the ACP states. It would also mean giving up the special power they possess because of the intergovernmental nature of the EDF – budgetisation would entail a greater transparency and democratisation, but also a power-sharing with the European Parliament (Orbie and Versluys, 2008).
In over 40 countries, mostly located in Sub-Saharan Africa, the EC and the EU Member States jointly deliver more than 50 per cent of Official Development Assistance (ODA) (EC and DAC, 2006). Together, the Member States and the EC are the biggest suppliers of ODA in the world (OECD/DAC, 2007b). It is obvious that the potential is enormous: harmonisation of the EC and all the EU Member States present in a given country would in most ACP-countries imply that already almost half of the donor community is bringing their aid in line. This would immensely diminish transaction costs for highly burdened governments.
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Molenaers, N., Nijs, L. Why the European Commission Fails to Adhere to the Principles of Good Donorship: The Case of the Governance Incentive Tranche. Eur J Dev Res 23, 409–425 (2011). https://doi.org/10.1057/ejdr.2011.5
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DOI: https://doi.org/10.1057/ejdr.2011.5