South South Development Cooperation

Tue, 03/23/2010 - 00:00 -- content_manager02

To coincide with the High Level Event on South South Cooperation and Capacity Development in Bogota this week, The BetterAid Coordinating Group has produced a policy paper proposing a set of recommendations for South-South Development Cooperation.

These recommendations are to be prioritized, addressed and elaborated upon in new commitments by all development partners in the preparations for the Fourth High Level Forum on Aid Effectiveness 2011 and the 2010 United Nations Development Cooperation Forum.

The paper is open to comments and will continue to be consulted with civil society in the lead up to the HLE in Seoul and in conjunction with emerging work done on South-South cooperation. Comments and contributions may be sent to the BetterAid Secretariat: secretariat@betteraid.org.

Download the paper:

English: Policy Paper on South-South Development Cooperation

Spanish: Documento de Posicionamiento Político sobre la Cooperación Sur-Sur para el Desarrollo

South-South Development Cooperation in context

The world today faces multiple interlinked financial, economic, food, climate, energy and care crises, with the most serious consequences affecting the already impoverished and marginalized groups in developing countries, of which a disproportional number are women. With the prospects of economic stagnation looming on the horizon in the developed world, poor countries are increasingly looking towards other developing economies for greater trade, investments and development cooperation as they seek individually and collectively to meet the profound challenges they face at present.

Developing countries today are building on a long and notable history of South-South Cooperation which began in the 1950s in the context of the common struggle of former colonies to attain genuine independence and development. South-South cooperation, then and now, takes many forms, ranging from economic integration, regional cooperation, the formation of negotiating blocs within multilateral institutions, humanitarian assistance, technical cooperation, cultural exchanges, military alliances and so on.

Although in terms of financial flows North-South Development Cooperation accounts for the far larger share of international development assistance, South-South Development Cooperation (SSDC) has been attracting more attention lately as Official Development Assistance (ODA) from so-called emerging donor countries has risen from around 5% of total ODA flows in the 1990s to between 7.8 and 9.8% in 2006 according to estimates by the United Nations Economic and Social Council (ECOSOC).

SSDC is seen by various development actors as a vital complement to North-South Development Cooperation. At a time when net financial flows are moving out of Southern economies towards the North rather than the reverse, SSDC may represent the strengthening of broader South-South cooperation and the promotion of alternative visions of development – such as the Andean indigenous “Buen vivir cosmovision”. It may also represent the fertilization of a debate on how ODA flows relate to broader financing for development flows, not only as North-South and South- South flows, but rather as what is increasingly more pervasive and representative of unequal international relations: South-North flows.

But while SSDC may mean a more balanced development partnership than in the case of North-South development cooperation, ODA and aid embody fundamentally unequal relations that need to be addressed through affirmative mechanisms of equality and mutuality in order to avoid the recurrence of common problems inherent to such power-based relationships.

In that sense, BetterAid welcomes the role SSDC might play in development partnerships that are more understanding of developing country problems and realities, given that middle-income donors share many of those same problems. However, it is critically important to guard against the threat of creating or reinforcing existing dependencies, especially in the case of countries that are regional powers and which might develop SSDC programs to carve their own zones of influence.

Broad South-South cooperation in recent years has been reflected in at least two types of initiatives: the formation of emergent country alliances such as through IBSA (India, Brazil, South Africa) and most recently BRIC (Brazil, Russia, India and China) meetings, on the one hand; and the creation of regional blocks, such as ALBA (The Bolivarian Alternatives of the Americas), UNASUR (South America Union), the African Union and the Association of Southeast Asian Nations (ASEAN), on the other. In some of these cases, an alternative South agenda was at the center of the initiative, creating a space for thinking politics differently.

Yet, the entry of some emergent countries into the G20 might represent a loss of interest in investing in South-South cooperation. It remains doubtful that emergent countries have any strong influence inside G20 decision-making processes. Yet, the sense of “belonging to the club” may lead Southern leaders who are now part of the G20 to invest less effort in deepening regional integration and South-South cooperation inspite of the uneasiness of their smaller regional partners.

Aid through SSDC is one part of South-South cooperation and can easily create or strengthen relationships of dependencies. To prevent this, it must be framed by a broad agenda drawn from South-South political alliances that are based on alternative models of Southern development, taking a more holistic vision and encompassing all forms of cooperation and financing for development including aid, trade, debt relief, foreign investment, domestic resource mobilization, etc.

SSDC- helping or hindering development?

The 2008 Accra Agenda for Action (AAA) of the Third High Level Forum HLF3) on Aid Effectiveness affirms the view that (in § 19.d): "South-South cooperation on development aims to observe the principle of non-interference in internal affairs, equality among developing partners and respect for their independence, national sovereignty, cultural diversity and identity and local content. It plays an important role in international development cooperation and is a valuable complement to North-South cooperation."

However, experience on the ground reveals that SSDC has a mixed record. On the one hand, SSDC certainly brings in important additional development assistance for poor countries, especially for important sectors that are unfunded or underfunded by traditional Northern aid sources at present. Moreover, such assistance from Southern donors does not usually impose stringent requirements on program countries in contrast to the restrictive and often socially harmful policy conditionalities associated with most donors of the Development Assistance Committee (DAC) of the Organisation for Economic Co-operation and Development (OECD) and the Bretton Woods Institutions (BWIs). Southern assistance also comes with less procedural requirements which can translate to quicker disbursements and more predictable financing, which are two characteristics of more effective aid. Technical assistance from Southern countries is also seen as more appropriate to local conditions and the needs of program countries compared to Northern expertise, which is often more expensive and less attuned to the realities on the ground.

On the other hand, while the principle of mutual benefit is a central tenet of South-South cooperation, middle-income donor countries often have markedly unequal relationships with the poorest countries in which the foreign policy thrust or strategic interests of the former, e.g. access to raw materials, energy supplies and markets may take primacy – much like traditional North- South aid relationships.

While Southern donors are wise to avoid interfering with the domestic economic policies and political processes of partner countries, civil society groups are concerned that human rights, gender equality, decent work, accountability and other social and environmental considerations that have been enshrined in international agreements are too often set aside in many SSC undertakings.This is further compounded by the serious lack of transparency in the terms and conditions of many SSDC transactions that precludes any meaningful citizen participation in shaping policies and holding development partner governments accountable for their aid interventions.

Southern donors – with immense development challenges of their own - are understandably reluctant to be judged by the same criterion that Northern donors have adopted for themselves, whether as expressed in DAC guidelines, the Paris Declaration principles or the AAA. Nevertheless, the BetterAid Platform, an open platform of civil society organizations (CSOs) from around the world, believes that SSDC should adhere to certain norms and principles to ensure that Southern development assistance truly impacts positively on the lives of poor and marginalized populations and upholds international promises made. Furthermore, these principles should ensure that SSDC does not reinforce existing relationships of dependency between major emerging economies and other developing countries, especially those that are in their regional area of socio-economic influence. Quite the contrary, SSDC should promote the leveling of intra-regional and inter-regional disparities.

Recommendations

BetterAid, recognizes the need for international development cooperation that is equitable and focused on social and economic justice for people living in poverty. It calls for fundamental reforms in prevailing aid priorities and practices of donors, including those from the South, guided by principles and approaches to ensure that international development cooperation promotes sustainable change that addresses the root causes as well as the symptoms of poverty, (gender) inequality, marginalization and injustice; and affirms the role of impoverished and marginalized populations as central actors and owners of development.

The following set of recommendations is BetterAid’s contribution towards the crafting of norms and principles that should guide SSDC in the future. We urge all development partners to discuss and translate these into clear and monitorable commitments in the lead up to and during the 2010 United Nations (UN) Development Cooperation Forum (DCF) and the 2011 HLF4 in Korea.

<!--[if !supportLists]-->1. <!--[endif]-->Promote human rights, social justice and sustainability as the fundamental principles and goals of SSDC, ensure the application of international humanitarian laws and covenants as the basic framework of SSDC.

• SSDC should explicitly incorporate strategies aimed at the progressive realization of human rights, gender equality, civil society participation, decent work and sustainable development with timeframes for measuring progress on specific dimensions of these rights and which are aligned with those outlined by global agreements on the topics.

· <!--[endif]-->SSDC partners should make use of existing monitoring and reporting systems for international commitments. Human rights bodies including the UN Committee on Economic, Social and Cultural Rights as well as CSOs should also be involved in monitoring the implementation of SSDC initiatives in addition to joint reviews or peer review mechanisms and internal evaluations.

2. Promote SSDC as a strategy by which all people and countries of the South pursue economic independence and self-reliance based on shared interests, common objectives and solidarity.

• SSDC is an expression of solidarity borne out of shared experiences and interests. SSDC recognizes that developing countries have similar problems such as widespread poverty, wide income and social disparities, mass unemployment and underemployment, environmental degradation, constricted policy space and unequal relations with Northern countries. At the same time developing countries have diverse experiences and capacities – financial, technical, institutional - for dealing with these problems. SSDC thus allows developing countries to share these capacities and learnings with one another in a mutually beneficial way.

• Developed countries and international organizations such as the EU and the UN should systematically support these undertakings through trilateral arrangements or at the regional, inter-regional, sectoral or multilateral levels. SSDC should be encouraged as an important complement and supplement to North-South development cooperation, especially for areas not prioritized by the latter. But SSDC should not be seen as a replacement for Northern development assistance or used to rationalize cutbacks in Northern ODA budgets. Rather it should contribute to reshaping discussions of aid effectiveness and to re-focus them on development effectiveness.

<!--[if !supportLists]-->3. <!--[endif]--> Abide by the principles of mutual benefit, equality and solidarity in SSDC in an affirmative manner.

• To ensure mutual benefit, SSDC should be based on joint assessments of development needs and capacities conducted by partner countries through an open, transparent, accountable and inclusive process involving citizens, elected officials, parliaments, CSOs - including women’s rights organizations, academic institutions and media on both sides of the partnership.

• However, it is also important to recognize disparities among Southern countries that may translate to unequal relations between participants in SSDC. Genuine solidarity requires that the development needs of the weaker development partner are the foremost consideration rather than donors’ strategic interests. This means aligning SSDC to the democratically-determined national development and poverty reduction strategies and priorities of the program country.

4. <!--[endif]--> Adhere to the highest standards of openness and transparency.

· Governments on both sides of SSDC should disclose information on the terms and conditions of SSDC programs, projects, loans and export-credit arrangements from proposal stage to post-implementation and evaluation. This should be done in a comprehensive, timely, accessible, predictable and pro-active fashion.

· <!--[endif]--> Indicators for evaluating the social and environmental risks and actual impacts of SSDC should be developed, with disaggregated figures for different sectors of the population, including sex-disaggregated data. Also, the consistent integration of a gender and social analysis in all phases of projects or programs is paramount.

· <!--[endif]--> Citizens audits should be encouraged and allegations of corruption should be reported and investigated. This work should be supportive and reflect the commitments made by signatories to the UN Convention against Corruption (UNCAC).

5. Strengthen democratic local ownership and accountability to all citizens in program countries as well as partner countries.

· <!--[endif]-->SSDC program countries and partner countries should set up mutual assessment reviews to jointly assess progress of SSDC. But accountability mechanisms must move beyond donors and partner country governments to all citizens and parliaments. States must fulfil their obligation to enable consultation with communities and CSOs and to promote and ensure their participation in transparent decision-making processes.

· The process of defining appropriate indicators and measurements of the development effectiveness of SSDC should be an open and participatory process. Institutional mechanisms to promote accountability should be established and funded to ensure the meaningful involvement of civil society and other stakeholders, especially those from impoverished and marginalized communities and groups, in monitoring and evaluating SSDC initiatives.

· States must also establish mechanisms, including judicial means, through which victims of rights violations associated with SSDC undertakings can seek effective remedies in order to ensure that their rights are adequately protected.

6. Work for debt cancellation, not add to debt accumulation.

· There is concern among civil society that loans from Southern donors are also contributing to debt build-up in low income countries. Southern donors and program country governments should reveal the terms and conditions of loans and export credit transactions in a transparent, timely and predictable manner, and through accessible platforms. Anomalous, illegitimate debts and odious debts should be cancelled.

· Southern governments should support the establishment of fair and transparent sovereign debt work-out mechanisms that are independent from international financial institutions. This new binding institutional framework should revise the current debt sustainability framework so as to include domestic debt, human development and environmental and climate justice considerations.

7. Establish a more equitable, transparent and inclusive aid governance system encompassing DAC donors, emerging donor countries, developing country governments and civil society representatives.

· A multilateral and multi-stakeholder forum at the international level can help enhance harmonization in aid policies in line with human rights obligations and internationally agreed development goals while respecting democratic and local ownership of the development process.

· Such a forum can be an important platform for studying and promoting best practices and scaling-up cooperation, not just among developing countries, but also with developed countries and multilateral institutions.

· Such a body is also important for enhancing policy coherence in order to ensure that the broad range of development-related policies implemented by donors and program countries - in foreign investment, trade, migration, industry, agriculture, energy, environment and so on – are mutually supportive and development effective in the sense that they contribute to and not undermine human rights, gender equality, decent work and environmental sustainability.

· It is of great urgency and need that a common system and standards for sharing aid information and measuring impacts is developed, similar to international work being done through the International Aid Transparency Initiative (IATI) and Publish What You Fund. This will help to increase accountability and transparency of SSDC and create stronger incentives for improving its development effectiveness by reducing corruption, waste and misinformation about flows.

8. Ensure meaningful participation of CSOs in the DCF 2010 and HLF4 2011.

· The DCF has the potential for a more legitimate, holistic and balanced approach to reforming international development cooperation for the fulfilment of the right to development. It can be the focal point within the UN system for mutual learning and greater harmonization in aid and development policies of donors and program countries together with development agencies such as the International Labor Organization, the Food and Agriculture Organisation, United Nations Development Fund for Women, etc. as well as human rights treaty bodies.

· But meaningful multi-stakeholder participation by other development actors (CSOs, parliamentarians) in the preparations and deliberations of the DCF must also be strengthened as full and equal participants. Their perspectives should be brought to bear on reforms on the development cooperation system being contemplated at the DCF and the OECD/DAC.

Conclusion

The rise of South-South Cooperation introduces new dynamics to international development cooperation. SSC challenges traditional donor-aid relationships inasmuch as it promotes economic independence and collective self-reliance of developing countries, and aspires for cooperation on the basis of equality, solidarity and mutual benefit. On the other hand, SSC practices, especially of some of the major emerging donors from the South, distort some of these tenets and mirror the highly unequal relations of dependency that characterize traditional North- South aid.

In any case, there is a need to re-orient SSDC, along with international development cooperation more broadly, to adhere to norms and guidelines that consistently takes into account human rights, equity, gender equality, decent work, ecological sustainability, democratic ownership and other key elements of social justice.

For this shift to happen there must be a commitment on the part of all development actors – donors, program countries and civil society -- to reforming international development cooperation for development effectiveness. BetterAid challenges all stakeholders to take advantage of ongoing processes such as the WP-Eff and key moments such as the DCF and the HLF to push forward this agenda so that international development cooperation truly responds to the profound challenges faced by humanity today and in the future.

Notes

Buen vivir is the world vision of the Andean indigenous population that is now included in the new constitution of Bolivia. It is based on the idea that the goal of life is not living “better” in a continuous search for profits and new consumerist desires. On the contrary, it is about “living well” (“buen vivir”), with people’s sovereignty over resources and placing the environment at the centre of life.

This can be observed in the foreign aid practices of China, India and Saudi Arabia which are among the largest Southern contributors of ODA. See Dane Rowlands, Emerging Donors in International Development

Assistance: A Synthesis Report, International Development Research Center, Canada, January 2008; and Espen Villanger, Arab Foreign Aid: Disbursement Patterns, Aid Policies and Motives, CMI Report 2007, Chr.

Michelsen Institute, Norway

For instance, Human Rights Watch has raised issues with recent Chinese investments in Angola, reporting that Angolan troops stationed in the oil rich Cabinda area torture civilians to control their movements. CSOs have also voiced concern over poor working conditions of workers and non compliance with environmental safety regulations. Regular mine accidents in Zambia have come under scornful assessments while environment activists in Mozambique have also opposed Chinese timber buyers who get tropical hardwoods from Mozambique’s semi –arid forests. In the same vein, a proposed dam in Mozambique, Mphanda Nkuwa has been criticised for weak social and environmental assessment with fears that it has potential negative impacts for the Zambezi delta. See F. Manji and S. Marks (eds) African perspectives on China in Africa, Nairobi and Oxford: Fahamu.,2007: 67, 147

BetterAid also calls for significant changes in international global governance structures at all levels, including trade, financial markets, foreign direct investment and debt. In practical terms, this means empowering the poor and respecting, protecting and fulfilling international human rights standards. This includes economic, social and cultural rights and means that gender equality and women’s rights are explicit in every sector, rather than only “mainstreamed”, which can result in the interests of women becoming invisible. These objectives must guide policy discussion and legislation, orient participation and underpin priorities in aid budgeting, planning and monitoring. See BetterAid Policy Paper, “Development Cooperation: Not Just Aid Key Issues: Accra, Seoul and Beyond.”