Article, Global

“Poverty is a political choice”

05.10.2020, International cooperation

The outgoing UN Special Rapporteur on extreme poverty leaves behind an alarming report. It posits that the narrative of declining global poverty is based on questionable figures. And the role of development cooperation is being overrated.

Kristina Lanz

Expert on international cooperation

Philip Alston, former UN Special Rapporteur on extreme poverty and human rights during a visit to the village of Kampung Numbak in Sabah province, Malaysia.
© Bassam Khawaja

The final report by UN Special Rapporteur on extreme poverty and human rights, the Australian Philip Alston (70), Professor of International Law and Human Rights at the New York University School of Law, opens an urgently needed debate. We are repeatedly told by governments, the media and development organisations that recent decades have seen a massive decline in global poverty, thanks not least of all to the generous aid of the wealthier countries.

The narrative regarding a substantial decline in poverty is generally based on World Bank parameters, which set the extreme poverty threshold at 1.90 US dollars per day. This arbitrary figure is derived from the average of the national poverty thresholds established for 15 of the world’s poorest countries. On this basis, the number of people living in extreme poverty is thought to have declined from 1.895 billion in the year 1990 to 736 million in 2015, or from 36 to 10 per cent of the world’s population. What is often left unsaid is that this by no means indicates a global trend — in sub-Saharan Africa and the Middle East, the number of people living in poverty even increased by as many as 140 million during this period. What is better known is that poverty reduction occurred predominantly in China where, by World Bank measurements, the number of people living in extreme poverty dropped from 750 million to 10 million over the period concerned.

A closer look at the statistics behind these estimates is warranted. The aforementioned poverty yardstick makes no allowance for the differing basic needs of individual countries or regions, but is treated as an absolute and constant value – adjusted only for purchasing power parity.[1] Hence, the purchasing power-adjusted poverty threshold in Portugal, for example, is 1.41 euros, which of course is hardly enough for mere survival. But in most developing countries as well, national poverty thresholds are set well above the World Bank’s 1.90 US dollars, with the result that national statistics show poverty rates much higher than those based on World Bank calculations. Two examples are Thailand and South Africa: the former has no extreme poverty by World Bank standards, whereas the national statistics show 9 per cent; for the latter, the difference is 18.9 per cent versus 55 per cent.

If we take a more realistic but no less arbitrary poverty threshold of 5.50 US dollars per day, global statistics look less rosy. The number of people affected by poverty will have fallen from 3.5 to 3.4 billion between 1990 and 2015 (or from 67 per cent to 46 per cent of a world population that grew strongly over that period). This reckoning too overlooks the fact that many people affected by poverty such as the homeless, migrant workers, refugees or domestic workers are not even included in poverty statistics, which are derived essentially from household surveys. Nor do the statistics reflect gender-specific poverty differences.

Climate change, the corona crisis and the accompanying sharp economic downturn in many countries are compounding extreme poverty even further. The World Bank anticipates that climate change will plunge an additional 100 million people into extreme poverty (measured by 1.90 US dollars per day) and that the corona crisis will cause as many as 60 million people to fall back into extreme poverty. With more realistic yardsticks these figures would be considerably more depressing.

Has development cooperation failed?

One could conclude that development cooperation has failed if there is a persistently high level of extreme poverty. This argument, however, credits development cooperation with power and influence that it simply does not have. The Alston report shows that for the year 2019, OECD countries disbursed 152.8 billion US dollars in the form of grants or favourable loans to developing countries. At the same time, the poorest countries as well as middle income ones made annual debt repayments of 969 billion US dollars. Some 22 per cent of that amount, or 213 billion, represented interest alone, which therefore produced no development benefits at all. Perhaps even more dramatic are the billions that developing countries lose each year as a result of profit shifting by multinational corporations[2] and illicit financial flows, or losses that they suffer as a result of unequal trade relations.

Development cooperation has demonstrably helped many people escape dire poverty and considerably improved living conditions for the most needy. Much has been achieved over recent decades, especially in education, healthcare and the reduction of maternal mortality. But all this means very little if at the same time, rising numbers of people are losing their livelihoods to make way for commercial agriculture, the extraction of raw materials or the building of gigantic infrastructure projects most often one-sidedly oriented towards export promotion. Countries are still being compelled through World Bank and International Monetary Fund (IMF) loans, or more precisely the attached conditionalities, to cut back social spending, deregulate their trade and guarantee fiscal privileges for foreign investors. Even in today’s post-colonial era, most developing countries continue to be commodity suppliers to the rest of the world, finding themselves trapped in a web of debt, unequal trading relations, tax flight and corruption. In these circumstances, the relatively modest resources of development cooperation remain woefully inadequate.

UN Special Rapporteur Alstom puts it succinctly: “Poverty is a political choice”. People remain in poverty as long as others continue to profit from it. Companies domiciled in the rich countries are still allowed to generate massive profits on the backs of the poorest, and we consumers are expected to buy goods produced cheaply elsewhere (such as food, clothes, or electrical appliances).

Focussing on inequality

Alston logically advocates placing not just poverty but also inequality at the centre of the debate. Alston is by no means the only one making this call. In a recently published paper, German World Bank Executive Director Jürgen Zlatter urged the Bank to focus more strongly on inequality within and between countries. He cites the economist Thomas Piketty, for example, to illustrate the appreciable worsening of inequality over the same period in which the World Bank measured a massive decline in poverty. Hence, between 1980 and 2014, the post-tax incomes of the bottom 50 per cent of the world’s population grew by 21 per cent, while those of the upper 10 per cent rose by 113 per cent. Over the same period, the incomes of the top 0.1 per cent of the world’s population skyrocketed by as much as 617 per cent! The upshot is that today, the world’s richest 1% have more than twice as much wealth as the poorest 6.9 billion people.

Zlatter highlights how the policies pursued in many countries during the 1980s and 1990s weakened trade unions, curtailed social benefits and reduced the progressivity of income taxes. The ever greater liberalisation of trade and the emergence of global value chains are believed to have significantly boosted the market power of individual companies and sparked a global race to the bottom with respect to wages. At the same time, the liberalisation of the financial sector did much to exacerbate inequality, writes Zlatter. Although the author stops short of any direct criticism of the World Bank, these are the very liberalisation and deregulation measures still being imposed on developing countries by the World Bank and IMF.

World Bank economist Zlatter and UN Special Rapporteur Alston both agree that inequality and social redistribution must be placed at the centre of the debate – not only within the World Bank, but also in the broader debate on poverty. For them, the main starting point is a strong focus on tax justice. The alternative looks gloomy: not only will the accelerating climate change and the disastrous economic impacts of the corona crisis plunge huge numbers of people into poverty, but we must also expect mounting social unrest, conflicts and protest movements.

[1] Purchasing power parity is calculated starting with what 1.90 US dollars can buy in the USA and determining how much money is needed in other countries to purchase the same things.

[2] According to a Research project in which the economist Gabriel Zucman was a key participant, in 2017 multinational enterprises shifted 741 billion dollars to tax havens, of which 98 billion flowed into Switzerland. Unfortunately, we have only insufficient data on most of the profit shifting from developing countries – the data available, however, are disturbing. Nigeria, for example, loses about 18% in profit and tax revenue each year, South Africa 8% and Brazil 12%.

global

The Alliance Sud magazine analyses and comments on Switzerland's foreign and development policies. "global" is published four times a year (in german and french) and can be subscribed to free of charge.

Article, Global

Global solidarity in crisis

07.12.2021, International cooperation

Despite vaccines and economic recovery in Switzerland: globally, the corona crisis is far from over and inequality is on the rise. An interim assessment and a plea for more global responsibility.

Kristina Lanz

Expert on international cooperation

A Catholic priest with soldiers disinfecting the statue of Christ in Rio de Janeiro, Brazil.
© Ricardo Moraes / REUTERS

In December 2019, Chinese media reported the spread of an unknown virus in Wuhan, at the end of January 2020, the World Health Organisation (WHO) declared a global health emergency. The virus has meanwhile spread rapidly around the world and brought the international economy and the social lives of many people to a standstill virtually overnight. Since then, many things have no longer been the same. More than five million people around the world have died from the virus (the estimated number of unreported deaths is much higher), while countless others continue to suffer the health-related, social and economic consequences of the pandemic. Although the development and approval of several Covid vaccines offered a glimmer of hope on the horizon, the pandemic is far from over in many places and several of its economic and social impacts are only now becoming really apparent.

In April 2020 Alliance Sud published an article entitled "A global crisis needs global solidarity", highlighting the fact that the crisis affects everyone, but not equally. Alliance Sud argued for more support for the poorest countries in overcoming the crisis, for global debt forgiveness and for reconstruction guided by the "build back better" principle. But what has happened in the meantime and where do we now stand after almost two years of Corona crisis?

Do we really have the pandemic under control?

Western health systems have also repeatedly come close to breaking point over the last two years. Crisis-weary health personnel, overcrowded intensive care units and many tragic personal stories have dominated the headlines. But the most serious catastrophes were being played out elsewhere – in India, Brazil or Peru, where the spring of 2021 witnessed countless families driving around cities for hours in search of oxygen while their loved ones slowly suffocated in hospital or on the way there; or in the refugee camps of Bangladesh, Colombia or Turkey, which saw not only the rapid spread of the virus but also appreciable spikes in food shortages and hunger.

Millions of people lost their jobs during the covid pandemic. This has led the International Labour Organisation (ILO) to estimate the 2022 unemployment figure at 205 million, compared to 187 million in 2019. Unemployment has skyrocketed over the past year, especially among young people and women. The number of working poor – workers who live on less than 3.20 dollars a day – has also risen by 108 million since 2019. The situation is most disastrous, however, for the more than two billion informal sector workers who have no social security at all. For them, lockdowns and other restrictions have meant losing their livelihoods in many instances.

The World Bank too finds that extreme poverty has again risen for the first time in 22 years on the back of the Corona crisis. It estimates that to date, some 121 million people have been pushed into extreme poverty as a result of the crisis. But as Alliance Sud has reported in a background article, the World Bank's 1 dollar/day poverty line is set extremely low and has several methodological flaws. A more realistic definition of extreme poverty would perhaps convey an even more dire picture.

Food insecurity and hunger have also been considerably exacerbated by the Corona crisis. In 2020, for example, one in three people lacked access to adequate food. In the space of just one year, the prevalence of malnutrition rose from 8.4 to about 9.9 per cent, having remained virtually unchanged for the five preceding years. Compared to 2019, hunger affected an additional 46 million people in Africa, 57 million in Asia and roughly 14 million in Latin America and the Caribbean in 2020.

Through an extensive survey of 16,000 people in 25 countries, Helvetas and seven other European NGOs have verified the massive decline in income, food security and access to education confronting many people. The study shows that those who are already most vulnerable – the elderly, people with disabilities, single mothers, women and children – are the ones being hit the hardest by the pandemic.

Global economic upheavals

While the economies of many Western countries, including Switzerland, seem to be recovering at a remarkable pace, the recovery in the Global South is proving much slower. The International Monetary Fund (IMF) projects world economic growth of 6 per cent in 2021, but a mere 3.2 per cent for the African economy. Compared to those of the 2008 global financial crisis, the economic repercussions of the Corona crisis have been considerably more devastating for most of the poorer countries – especially those in Africa and South Asia.

The global spike in commodity prices has driven up the cost of many basic products: metal and oil prices have been rising since mid-2020, and annual food price inflation reached almost 40 per cent in May 2021, the highest in a decade. While rising metal and oil prices pose a problem mainly for industrialised countries, rising food prices have significant implications for poverty and hunger in poorer countries. In Nigeria for example, food prices have surged by almost a quarter since the onset of the pandemic, driving 7 million people into extreme poverty.

Tourism has been another sector hit especially hard by the pandemic. International tourist arrivals in the poorest countries plummeted by 67 per cent in 2020. The UN estimates that it will take at least four years for the number of tourist arrivals to return to 2019 levels. This is jeopardising the livelihoods of individuals, households and communities as well as the survival of businesses all across the tourism value chain.

Burgeoning debt

While most developed countries have rolled out massive stimulus packages to attenuate the economic impacts of the Corona crisis, poorer countries lack both the resources and the policy space needed to emulate the West. This is so because a) their creditworthiness renders them unable to borrow on international capital markets at reasonable interest rates; b) they cannot print money owing to spikes in inflation; and c) international tax evasion impedes them from raising sufficient funds in their own countries.

The IMF estimates that low-income countries would have to spend some USD 200 billion over the next five years in the ongoing battle against the pandemic and another USD 250 billion to speed up economic recovery. Yet most of these countries have no room for manoeuvre to increase their spending. According to the IMF, 41 low-income countries even cut back their overall expenditure in 2020. This notwithstanding, 33 of them still saw a rise in their public debt-to-GDP ratio. The external debt of developing countries thus hit a record USD 11.3 trillion in 2020, 4.6 per cent more than in 2019 and 2.5 times the 2009 figure in the wake of the global financial crisis.

Where is the global solidarity?

Despite numerous calls for generous support and debt relief, little has been done to date. The Debt Service Suspension Initiative (DSSI) agreed on by the G20 countries, the World Bank and the IMF in the spring of 2020 led only to the temporary suspension of bilateral debt servicing for some countries. Not only did China, as a major lender, not participate in the initiative, but neither did the numerous private lenders support the DSSI.[1] Moreover, barely more than half of the "eligible" countries participated, for fear of displeasing their private creditors. Ultimately, the DSSI increased the financial leeway for 46 debtor countries in 2020 and 2021 (by USD 5.7 billion and USD 7.3 billion). However, as the suspended debt payments will have to be reintroduced into the repayment schedules as of 2022, the looming debt crisis was at best postponed rather than eliminated. Furthermore, the emergency loans granted by the IMF and the World Bank for dealing with the crisis are hardly the solution to the problem, as they only generate further indebtedness.

Although Official Development Assistance (ODA) increased by 3.5 per cent in 2020, it still represents a mere 0.32 per cent of the combined gross national income (GNI) of OECD-DAC member countries. This is less than half the internationally reaffirmed target of 0.7 per cent of GNI, which is supposed to be allocated to ODA and represents just about 1 per cent of the funds mobilised for domestic stimulus packages. Although Switzerland did quickly release additional funds for humanitarian projects and for the Covax Alliance, even in 2020, as one of the world’s richest countries, it only allocated 0.48 per cent of its GNI to ODA – a far cry from the internationally agreed target of 0.7 per cent.

Global vaccination apartheid

Former OECD Secretary-General Angel Gurría too has emphasised that far more will have to be done in the future to help developing countries with vaccine distribution, health care and assistance for the poorest and most vulnerable.

Unfortunately, the selfishness of Western countries is apparent not only in their economic stimulus packages, but also in the distribution of Covid vaccines. While many Western countries are already vaccinating children or administering third, so-called booster shots, in the poorest countries, just 3.1 per cent of the population have received at least one vaccine dose.

A study by the Airfinity research institute shows that at current vaccination rates, 80 per cent of adults in G7 countries will be vaccinated by the end of 2021. At the same time the G7 will have amassed nearly 1 billion surplus vaccine doses. These would be enough to vaccinate a large part of the population in the 30 countries with the lowest vaccination rates (most of them are in Africa). Set up to ensure more equitable worldwide vaccine distribution, the Covax initiative has so far delivered less than 10 per cent of the 2 billion doses promised to low and middle-income countries. Part of the reason for this is that richer countries have signed priority contracts with vaccine manufacturers, thereby squeezing Covax out of the vaccine market. Absurdly, several rich countries (including England, Qatar and Saudi Arabia) have themselves also obtained vaccines under the Covax programme.

With a population of 8.6 million, Switzerland too has so far signed contracts with five vaccine manufacturers for a total of almost 57 million doses (although only three vaccines have been approved by Swissmedic to date). Although Astra Zeneca is not licensed in Switzerland, 4 million doses of that manufacturer's vaccine were promised to Covax, of which only about 400,000 have been distributed up to now.

Alongside the Covax initiative, it is also crucial to build vaccine production capacity in low- and middle-income countries. To that end, however, pharmaceutical companies would need to share their vaccine technology and know-how with manufacturers in these countries. A proposal submitted by India and South Africa at the World Trade Organisation (WTO) seeking a temporary waiver from certain provisions on intellectual property rights for tests, treatments and Covid vaccines has been supported by China, Russia and in part by France, the USA and Spain, as well as by the WHO and Pope Francis. The pharmaceutical industry and Switzerland oppose it and are still arguing for voluntary measures.

Back to normality?

While it may well appear that the Corona crisis will soon be behind us in Switzerland, the world as a whole is still far from that point. It will take more than ad hoc support for humanitarian projects, the donation of "old" or "unwanted" vaccine doses and the granting of more loans to poorer countries to combat the current crisis and its underlying structural causes.

Only when we admit that we are all interconnected and bear a common responsibility to make the world a liveable place and to keep it that way, will we be able to move forward and overcome not just this crisis but also its underlying systemic crises, including the global climate crisis. For the Corona pandemic has made one thing abundantly clear: where there is a (political) will, there is a way.

[1] An Alliance Sud study, based on data from the Swiss National Bank (SNB) and the Bank for International Settlements (BIS), finds that the public debt owed by the 86 poorest countries to 40 Swiss banks amounts to 5.7 billion Swiss francs.

Switzerland's responsibility

As one of the world's richest and most globalised countries, Switzerland has a particular responsibility. Alliance Sud therefore calls on the country:

as the world's leading low-tax jurisdiction and seventh-largest financial centre, to act without delay to halt tax evasion from poor countries involving Swiss corporations, financial service providers and law firms. Only then will poor countries be able to mobilise sufficient public resources to fight the Covid crisis;
to make the case for the 40 Swiss banks with currently outstanding loans to the 86 poorest countries to write off all loans to these countries in the light of the social and economic circumstances prevailing in these debtor states;
to finally honour its international promise and gradually increase its ODA quota to 0.7% of GNI and make the rights, needs and aspirations of the poorest and most vulnerable people the principal focus of its development cooperation programmes.
and to hand over its surplus vaccine doses to Covax as soon as possible and cease stonewalling the WTO proposal by India and South Africa.

global

Article, Global

Chronicle of a death foretold (or perhaps not)

21.06.2022, International cooperation

Does the brutal military attack on Ukraine signal the beginning of the end of globalization, as is being put about by many sources? An attempt to take stock.

Andreas Missbach

Director

Kristina Lanz

Expert on international cooperation

Dominik Gross

Expert on finance and tax policy

Laura Ebneter

Expert on international cooperation

Chronicle of a death foretold (or perhaps not)

The difficulty of talking about globalization stems from the fact that the concept is used to mean very different things. The German “global historian” Juergen Osterhammel writes: “Everyone talks about ‘globalization’, tacitly assuming that its meaning is clear. An unrealistic assumption.” He therefore suggests that it would be better to speak of “globalizations”. As such, globalization would no longer signify the “single, all-embracing, worldwide process that encompasses all of humanity”, but a number of different processes in the world, whether concurrent or not, which may somehow be interconnected – or perhaps not.

Roughly speaking, there are two perspectives in the discourse on globalization, which are rarely distinguished well enough from each another, and which explain why there is so much talking at cross purposes on this subject. On the one hand, globalization means economic policy prescriptions that are based on an economic theory, or better yet, an ideology. That was how the “critics of globalization” of the noughties understood the concept. This ideology and the (often unpalatable) prescriptions were garnished with tales about the promises of globalization. On the other hand, the “globalization” label is given to real processes, e.g., the growth of international trade, the expansion of cross-border capital flows, or the weight of multinational enterprises – and the list could go on.

This is often premised on the assumption that the ideologically-inspired prescriptions constitute a linear path to the real and measurable processes such as the dismantling of trade barriers and capital controls that brought about the rapid expansion of global trade. It is not that simple, however, as a substantial part of the growth in world trade goes back directly or indirectly to the fact that China has become the “workshop of the world”. But China has been highly selective in its dismantling of trade barriers, it has never liberalized capital flows, and has also retained state control in other sectors.

The truth is that there is a complex mix of ideology, prescriptions, and real developments, which may be summed up as follows. Since the 1970s, the restructuring of global capitalism has been driven by an economic ideology that was eagerly embraced by multinational enterprises and Western governments. The economic policy prescriptions derived from it and applied by governments favoured the rise of global corporations and unleashed four key global processes: the rapid expansion of international trade, the relocation of industrial production to less “developed” countries (including China), the surge in South-North migration (more pronounced in the USA and in Europe, including from east to west) and – most critically – since the 1970s, the exponential growth of the financial sector and its significance for the economy and financial policy within countries and across borders.

The ideology

The economic ideology is commonly referred to as neoliberalism, and with “neoliberalism”, the situation is exactly the same as with “globalization” – two people in a room have three different interpretations of it. But help is at hand from the US historian Quinn Slobodian. In the book titled “Globalists – the End of Empire and the Birth of Neoliberalism” (2018), he distinguishes between two neoliberal concepts, the better-known one being from Chicago, and the other from Geneva. The first stands for more “laissez-faire” and less and less state (national) boundaries, i.e., it favours self-regulating markets, which increasingly replace smaller government in the role of structuring a society. Or, to paraphrase the Swiss FDP of the 1970s: more markets, less State. Neoliberal economists of the Chicago school associated with US economist Milton Friedman dreamt of a single, all-encompassing world market. In their view, politicians should retain a role only where this market fails to function. For Friedman and his followers, this ought never really to be the case, except in matters of security (army and police).

Slobodian establishes a contrast between this notion of neoliberal globalization as a worldwide process in which free market forces by themselves can deploy their full potential, and the Geneva group of neoliberal forward thinkers. This latter group came together in the 1930s at the University of Geneva – precisely where the UN also has its second home. Unlike the Chicago School, these members of the Geneva School, coalescing around the German economists Willhelm Röpke, Ludwig von Mises or Michael Heilperin, did not wish to liberate “the market” from “the State”, but instead to place the State at the service of the market, with the uppermost goal of securing the right to private ownership not only in a particular nation-state, but all around the world. Slobodian writes that what the “Geneva boys” wanted was for the State to provide the market with a global (private) law framework, thereby elevating to a supranational level the mechanisms that serve to encourage more private ownership – without also having to take on board the onerous, restrictive rules of a redistributive welfare state.

The prescriptions

In 1989, the prescriptions inspired by the economic ideology of neoliberals of varying hues was labelled the “Washington Consensus”, because it was embraced by the International Monetary Fund, World Bank, and the US Department of the Treasury, all institutions located in that city. In reality, “Consensus of Washington, Geneva (WTO – trade), Paris, (OECD – fiscal policy) and Brussels (EU)” would have been more appropriate. Emerging initially as a reaction to the Latin American debt crisis, the core of this programme consisted of competition (above all, the dismantling of the welfare state), deregulation (trade and capital flows), and privatization. In the 1980s, and in exchange for new loans, this “consensus” was imposed on debt-ridden Latin American and African countries through so-called structural adjustment programmes – a period that was later to be often called “the lost decade”, as poverty had increased substantially in many countries.

The driving force and the beneficiaries of this agenda were the multinational corporations and, more particularly, the banks and other financial players. In the year 2000, ABB Chief Percy Barnevik summed up the corporation’s programme as follows: “I define globalization as the freedom of our group of companies to invest wherever and whenever it wants, to produce what it wants, to buy and sell wherever it wants, and to keep all restrictions emanating from labour laws or other social regulations as minimal as possible.”

The collapse of the Soviet Union in December 1991 marked a major turning point. The end of the “East Bloc” left just one superpower, and the prescriptions could then be applied across the world. After the Global South, other prominent victims of these prescriptions were the countries of the former Soviet Union. US economic advisers persuaded their governments to apply the Washington Consensus as a shock therapy. The outcome was that domestic industry all but disappeared, and a handful of people were able to help themselves to some of the national wealth and to the commodities that had survived as the dominant sector of the economy. There would have been no oligarchs without the Washington Consensus.

The promises of globalization

The ideologies of globalization and its prescriptions went hand-in-hand with a series of narratives and promises, which – despite evidence to the contrary – are still to some extent being upheld to this day. They include, for example, assertions to the effect that the world economy will bring lasting prosperity to all countries that fully and consistently embrace free trade and the free movement of capital. Economic development driven by globalization is leading to the spread of Western values and ultimately to a world of democratic States cooperating peacefully with one another. Or, that “global governance” will raise the power of governments to the next level, and solve the world’s common problems.

It is now becoming increasingly evident that none of these promises has materialized. Whereas poverty has indeed fallen in some, mostly Asian countries (which embraced the Washington Consensus only partially, if at all), global inequality has been worsening in parallel. The economist Thomas Picketty points out that between 1980 and 2014, the incomes of the bottom 50 per cent of the world’s population rose by 21 per cent, while the incomes of the top 0.1 per cent of the world’s population rose 617 per cent over the same period. And even as trade liberalization and the emergence of global supply chains massively boosted the market power of individual enterprises, trade unions the world over were being weakened, social benefits were being curtailed, and many places witnessed the start of a race to the bottom with respect to wages.

And rather than peace, democracy and human rights as in the narrative, the reality is that ever more people today are facing oppression and repression. The Freedom House NGO, for example, finds that all across the world, democracy is currently under attack from populist leaders and groups, often accompanied by the repression of minorities and other contrived “enemies”. At the same time, autocratic regimes have been able, over the past two decades, to extend their influence ever further beyond their own national borders, in an endeavour to silence critics, overthrow democratic governments and reshape international norms and institutions to suit their own interests. This is also rendering cooperation in global bodies such as the UN ever more difficult.

End, what end?

Even if none of the promises of globalization has come true, the war in Ukraine is hardly likely to mark the “end of globalization” as an ideology and its associated policy prescriptions. On the one hand, even before the war, none of the institutions of the Washington, Geneva, Paris and Brussels consensus any longer represented, without differentiation, the same prescriptions as before the 2007 financial crisis. On the other hand, the still Western-dominated international financial institutions are just as happy to continue propagating aspects of this ideology, even though the ever worsening climate crisis, constantly recurring economic and food crises, and the fast deteriorating debt crises have in fact long demonstrated the unsuitability of these prescriptions. Regrettably, it cannot be assumed that the war will change this.

Is the war on Ukraine bringing real world economic integration to a standstill or even reversing it? This too is highly unlikely, even though some supply chains will be altered or truncated. The prospect of a Russia under sanctions coming together with China and a few vassal States to form an insulated Eurasian economic area can be ruled out. The West (including Japan) is economically much too important to China.

What next?

There is now an ever greater need to justify the ideology of globalization. The various crises clearly demonstrate that the present world economic model is not one that can bring about peace, freedom, health and well-being for all. That it is destroying the planet is glaringly obvious anyway. So where do we go from here?

First, we need a new ideology which, instead of relying on “perpetual” economic growth, profit maximization and short-term self-interest, focuses on our inter-dependencies, our integration into the natural environment and our shared, long-term interests.
Next, we need an economic and development policy aimed at realizing the universal human rights for all people on earth, and which promotes rather than hampers their achievement around the globe. Second, this new development policy must be able to demonstrate how it can achieve the latter in harmony with the planet’s natural limits. The UN Sustainable Development Goals enunciated in the 2030 Agenda should provide guidance in this respect.

There is no blueprint or roadmap for the major transformation required, it will take countless experiments, search processes, projects and policy debates, from the grassroots all the way to international global governance forums. Like the anti-globalization movement of the noughties in their response to former British Prime Minister Margaret Thatcher’s assertion that “There is no alternative”, we say, “There are thousands of alternatives.”

global

Article, Global

Who is afraid of the NGOs?

23.03.2021, International cooperation

The Responsible Business Initiative failed in November because of a majority vote by the cantons, conservative economic associations could heave a sigh of relief. The backlash came nonetheless: Chronicle of a political attack on NGOs.

Kristina Lanz

Expert on international cooperation

Written admission test at the HSG St. Gallen for foreign applicants. Swiss civil society is also being put to the test, although it has long since passed the democracy test.
© Ennio Leanza / Keystone

Rarely has a popular initiative caused the kind of furore triggered by the Responsible Business Initiative (RBI). For months or even years ahead of the vote, it regularly made headlines and had a very high public profile thanks to the orange flags and the many activities organised by countless local committees. For the first time in Swiss political history there was concerted action by a broad coalition comprising 130 NGOs, numerous church and business representatives, parliamentarians of all political stripes, and thousands of volunteers. Although the initiative ultimately failed owing to the majority cantonal vote, it did show what civil society in general and NGOs in particular can achieve when they join forces (the initiative achieved a popular vote of 50.7%). What could really be construed as a positive sign of a vibrant democracy and an interested population seems not to be to everyone’s liking.

Liberals want NGOs banned from politics

Even before it came to a referendum, Ruedi Noser, Councillor of States (FDP.The Liberals) and opponent of the RBI from the outset, tabled a motion urging the Federal Government to examine whether non-profit organisations (NGOs) that engage in political work still met the eligibility criteria for tax exemption, or whether their tax-exempt status could be revoked in some way. But in a legally sound response, the Federal Council calls for the motion to be rejected. It lays out the activities that are deemed to serve the common good, namely: “social work, the arts and sciences, teaching, human rights promotion, the defence of homeland, nature and animals, as well as development aid.” It further points out that “in the case of tax-exempt organisations, there can also be interfaces with political topics (for example with environmental organisations, organisations for the disabled, health organisations, human rights organisations, etc.)”. The Federal Council goes on to state that “material or moral support for initiatives or referendums does not in principle stand in the way of tax exemption.” The motion will be discussed first in the Economic and Tax Committee (EATC) of the Council of States and then go back to the Council of States.

The RBI vote ignited a firestorm in Parliament, generating a deluge of questions, interpellations, postulates and motions, all of them questioning the political role of NGOs. National Councillor Elizabeth Schneider-Schneiter (Christian Democrats / CVP), for instance, has submitted a postulate requesting a report from the Federal Council on the question of which NGO activities were being funded from which sources and on what legal basis, and which political representatives sat on the steering committees. The rationale given for her initiative is that “development aid organisations are becoming ever more involved with development policy demands in Switzerland rather than occupying themselves with concrete development aid abroad.” A motion by National Councillor Hans-Peter Portman (FDP.The Liberals) calls on the Federal Council to review government support for international cooperation projects run by non-governmental organisations (NGOs) that have taken part in political campaigns and, if necessary, to cease that support.

These initiatives are apparently meant to avoid any critical discussion of the political role of private sector-based associations and think tanks, which as non-government players also in fact count among NGOs. Hence the express reference only to NGOs in the realm of development cooperation. The only thing is that NGOs have always been contractually prohibited from using funds from the Swiss Agency for Development and Cooperation (SDC) for political work. It does make sense for the Federal Government to be unwilling to put tax monies into political campaigns – but a blanket ban on political involvement by NGOs that receive federal funding would be as absurd as it would be problematic.

Democracy thrives on diversity of opinion

The lifeblood of our democracy is the fact that a diverse range of players can bring their expertise, opinions and concerns into the political debate. In addition to a variety of private sector players and other civil society groups (such as trade unions or education sector players), NGOs working for the common good also contribute to the democratic debate in our country. Unlike private sector representatives, who generally lobby for their own interests, NGOs under their mandates champion charitable, environmental or social causes. Political activities are funded from member contributions as well as from donations for specific political purposes.

While various conservative politicians sit on private sector boards of directors, regularly appear at lobbying events mounted by private sector associations and often vehemently oppose greater transparency (as that would reveal certain connections even more clearly), NGOs involved in development cooperation are now expected to undergo close scrutiny for any political connections and representation of interests. In parallel, it would seem that the same politicians so keen on the political muzzling of NGOs are not bothered by the fact that other players and associations that likewise benefit from public subsidies and other contributions also launch information campaigns and get involved in referendum battles.

A blanket “ban from politics” for NGOs that receive public funding would indeed effectively silence many critical voices and undergird the supremacy of business sector lobbyists. However much some conservative politicians may be hankering for this, it would be a declaration of bankruptcy for a country that readily highlights its democracy, world openness and humanitarian tradition. At the same time, should a political ban be placed on NGOs, other government contributions and subsidies would consequently have to be re-examined as well to see whether their recipients are politically active and, if necessary, such government contributions would also have to be stopped. That would hardly be in the interests of the politicians concerned.

Education as the key to the 2030 Agenda

In the aftermath of the RBI referendum, however, it was not just the political work of NGOs that came in for strong criticism – their educational and awareness-raising work in Switzerland also drew fire from all sides. In December, the SDC (presumably under pressure from the head of the Department) announced at the very last minute that with immediate effect it would no longer be able to fund educational and awareness-raising work by NGOs in Switzerland. This decision was all the more surprising, considering that just a year ago the SDC adopted new guidelines for cooperation with NGOs, which, among other things, noted that an important task of Swiss NGOs was to “sensitise the Swiss public, in particular young people, to global challenges and to raise awareness about the close links between peace, security, sustainable development and prosperity”[1].

Moreover, awareness-raising and education on sustainable development topics (including development cooperation) are a key component of the 2030 Agenda for Sustainable Development, to which Switzerland has also signed up. With its 17 Sustainable Development Goals (SDGs), the 2030 Agenda is addressed to all countries, not just developing one. It envisages a paradigm shift in international cooperation in that it calls on all countries to incorporate sustainability into all areas of policy-making and to take account of global interconnections in the process. Awareness-raising and education are indispensable to achieving the SDGs: SDG 4, for example, urges all countries to ensure that, by 2030, all students acquire the necessary knowledge and qualifications to promote sustainable development. This encompasses education on human rights, sustainable lifestyles, gender equality, a culture of peace and non-violence, world citizenship and the valuing of cultural diversity, as well as the contribution of culture to sustainable development. Education for sustainable development also plays a vital role in Switzerland’s 2030 Sustainable Development Strategy (SDS), the consultation procedure on which has just ended.

Switzerland ignores OECD recommendations

Even if NGOs may continue to engage in educational and awareness-raising activities in Switzerland (provided they can raise the funding by other means), the official exclusion of education and awareness-raising from SDC programme contracts with NGOs amounts to a huge backward step in the understanding of development cooperation. As is also the wish of National Councillor Schneider-Schneiter, NGOs should in future go back to focusing on “aid” abroad and cease drawing attention to global connections. What this really means is that NGOs may campaign against child labour in Côte d’Ivoire for example, but should make no mention of the fact that Swiss corporations too are profiting massively from child labour; they may build wells in Tanzania but are not allowed to report that irresponsible mining operations by multinational corporations are a major contributor to the water shortage; NGOs may care for climate crisis victims in Bangladesh but must refrain from pointing out that our lifestyle, our financial centre and our industry are massive contributors to global warming.

In what is termed a peer review, the OECD Development Assistance Committee (OECD-DAC) assessed Switzerland’s development cooperation and offered a range of suggestions for improvement.[2] First, the OECD points to the lack of analysis and above all, of debate on the impacts of Switzerland’s domestic policies (such as financial, agricultural or trade policy) on developing countries. It urges Switzerland to “disseminate and debate such analyses, both in the government and broader Swiss society.” The OECD further points to Switzerland’s continuing poor record when it comes to communication and awareness-raising among its population on development cooperation topics. It therefore urges the Federal Department of Foreign Affairs (FDFA) to develop, resource and implement communications and global awareness-raising strategies for its development programme, and to enable SDC to communicate proactively to strengthen political and public support. Yet the recently issued decision indicates that the FDFA is moving in the opposite direction, a criticism also voiced by former Federal Councillor Micheline Calmy-Rey in an opinion piece in the “Weltwoche” newspaper. The SDC continues to be patronised in matters of communication and NGOs are expected to have as little to say as possible on matters of policy coherence. We may yet hope that the view will prevail in Parliament that Switzerland’s democracy can only be the better for an enlightened, well-informed and politically active population and a strong civil society.

[1] See: SDC guidance for engagement with Swiss NGOs

[2] See: OECD DAC (2019). The DAC’s main findings and recommendations. Extract from: OECD Development Co-operation Peer Reviews Switzerland 2019,

global

Article

Striving for "responsible communication"

01.10.2020, International cooperation

Together with its member and partner organizations, Alliance Sud has drawn up a manifesto for responsible communication on international cooperation. Learn more about it here.

Marco Fähndrich

Responsible for communications and media

Striving for "responsible communication"

British songwriter Ed Sheeran in Liberia: Celebrities frequently make themselves available for good causes (and photos), including in Switzerland. This helps to entrench a paternalistic concept of development.
© Foto: Comic Relief.

Besides media and political circles, non-governmental organizations (NGOs) also contribute to shaping the public perception of the Global South through their fundraising and public relations work. The content of the communication also frequently perpetuates stereotypes – paternalistic images of development portray developed countries as showing "underdeveloped" countries how things are done properly. People of the Global South are often represented as objects and recipients of aid or support, while development organizations and their staff, in contrast, are portrayed as doers and experts.

Many communications activities rarely address the context in which development cooperation takes place, more particularly the structural causes of poverty and exclusion. The systemic interconnections too, in other words the general political, economic and social environments, are often overlooked. The upshot is that the public at large has very limited concrete notions as to the workings and impacts of development cooperation. Frequent contradictions and inconsistencies also arise between development policy campaign work and fundraising, and carry the risk of eroding trust in NGOs.

This manifesto offers some guidance for the staff of NGOs engaged in international cooperation. The core comprises sector-specific guidelines for responsible communication in international cooperation, which represent an undertaking to the public. Our goal is not perfection, but a self-critical and transparent reflection about our own work of communication.

Interested?

Other organizations working in international cooperation are also welcome to sign the manifesto and use it as a guide for their own communication. To do so, please get in touch directly with the Alliance Sud Media and Communications Officer (marco.faehndrich@alliancesud.ch).

Global, Opinion

An excess of neutralities

29.09.2022, International cooperation

Corona, climate and conflict are now exacting their price: the UN observes that for 90 per cent of all countries, the "Human Development Index" will decline for 2020 or 2021. During the global financial crisis, just one in ten countries was affected.

Andreas Missbach

Director

The view of Andreas Missbach, Director of Alliance Sud

Cassis, Pfister and Blocher[1] – all three gentlemen are vying to score points with the adjective they use to qualify the n-word. Before we come to the adjective, the noun. Switzerland's neutrality was vital while neighbouring countries remained at war. This was so at the time of the Franco-German War of 1871, and even more so during the First World War, when the country was riven by differing sympathies with the warring parties.

During the Second World War, neutrality notoriously went hand-in-hand another element – that of profiteering from business with the warring parties. Up to 1944, Swiss firms supplied enormous quantities of military materiel to Nazi Germany. During the war years, the situation could still have been described as an emergency, but the business dealings continued thereafter, as neutrality morphed into a fig leaf. "Neutrality", meaning "we do business with everyone and do not care about sanctions", was one of the three factors (together with the financial centre and tax legislation) that propelled Switzerland to global dominance as a commodity trading hub.

As a non-UN member, Switzerland has not adopted UN sanctions, including those imposed on Rhodesia (today Zimbabwe) or apartheid South Africa. Mark Rich, the godfather of Swiss commodity trading, whose firm became Glencore and whose “Rich boys” established companies like Trafigura, described his oil deals with the racist regime in southern Africa as his "most important and lucrative business". But the grain traders on the shores of Lake Geneva also profited from the USA's grain embargo against the Soviet Union and stepped into the breach, although ideologically and practically, Switzerland was by no means neutral during the Cold War.

Now to the adjectives: Ignacio Cassis' "cooperative neutrality" would have put the profiteering into perspective, in that it would have cemented the new status quo created by the Russian invasion (EU sanctions are being adopted). Yet the Federal Council rejected the Federal President's adjective.

Gerhard Pfister's "decisionistic (concept of) neutrality" is less clear. To go by his interview in the Le Temps newspaper, "human rights, democracy and the free expression of opinions" keep profiteering in check. According to an interview with the Tamedia newspapers, it is more about the values of the "western economic and social model", in other words, "rule of law, security of private property and social welfare". Pfister has also failed with respect to a specific matter; in the Council of States, his party The Centre rejected the proposal that Switzerland should also be able to impose its own sanctions.

Christoph Blocher's "integral neutrality" favours a return to unbridled profiteering. He once defended this approach against the critics of apartheid. The “Working Group on Southern Africa” (ASA), which he founded and chaired, fulminated against sanctions and provided South African right-wing politicians and military officers with a platform for their inhumane messages. The ASA also organised propaganda trips: "In the footsteps of the Boers".

I would also like to put forward some adjectives, as Switzerland would be best served by neutrality that is "compassionate (refugees) and globally sustainable (human rights before profiteering)".

[1] Ignazio Cassis of the Liberal Party is Federal Councillor, head of the Federal Department of Foreign Affairs and President of the Swiss Confederation in 2022. Gerhard Pfister, member of the National Council, leads the Centrist Party (Mitte). Christoph Blocher is a former federal councillor and éminence grise of the far right xenophobic Peoples Party (SVP).

global

Article, Global

"We must be tenacious in seeking solutions"

03.10.2022, International cooperation

Former National Councillor Regula Rytz continues her engagement on the international stage, as the new President of Helvetas. She sees today's multiple crises as an opportunity for global cooperation.

Andreas Missbach

Director

Kristina Lanz

Expert on international cooperation

Marco Fähndrich

Responsible for communications and media

"We must be tenacious in seeking solutions"

Regula Rytz can look back on a long political career. It began in the cantonal legislature, led her to the executive of the city of Berne and finally to the Federal Parliament as National Councillor and President of the Swiss Green Party. The former elementary school teacher and committed historian is now self-employed and active in various foundation councils and boards.
© Daniel Rihs / Alliance Sud

Interview by Kristina Lanz, Andreas Missbach and Marco Fähndrich

Until the spring you were still in the National Council, since June you have been the new President of Helvetas. What do you find most stimulating about your new job?

Regula Rytz: The world is reeling from crises. I am deeply concerned about the social impacts, both here in Switzerland and, most importantly, in places where people have long had to struggle to survive or to keep a roof over their head. Helvetas brings concrete improvements. To me that is more crucial than ever.

Will you miss anything about day-to-day politics in the Federal Palace?

The work in the committees, as that is where you work with colleagues from other parties to find solutions. I will not miss the increasing polarisation, however. I am happy to be engaged in an area that involves cooperative work.

Are there countries in the Global South with which you have a personal connection?

As a child my husband had lived with his parents in Nepal, where they worked for the organisation that was the predecessor to the Swiss Agency for Development and Cooperation (SDC). Helvetas too was already there at the time. Personally, I have been able to visit Nepal three times and have seen the way development cooperation has evolved over the years. Previously, investment went mostly into infrastructure projects such as road building; today, much more is also being done to stimulate the local economy, through vocational training, for example.

Will Helvetas be more politically engaged in Switzerland in the future?

That task falls to Alliance Sud, and it is doing a marvellous job. Our priority remains working on the ground: we collaborate with SDC and local authorities, and also with local NGOs and the private sector. Besides, building popular awareness in Switzerland regarding global interconnections and calling for greater political coherence has always been a matter of course for us.

You are also on the Board of Trustees of the "Gobat pour la Paix" Foundation. What can we still learn today, in a time of war, from Albert Gobat, a forgotten Nobel Peace Prize laureate and former Government Councillor of the canton of Berne?

Before the First World War, Albert Gobat was instrumental in setting up the Inter-Parliamentary Union in order to bring together people from all countries and parties to prevent further escalation. This shows us that there are always people seeking a way to resolve conflicts peacefully and constructively. We need this today more than ever. And by the way, Gobat came from the Liberal party and can also be an example to today's FDP.The Liberals.

Do you mean to today's Foreign Minister and Federal President Ignazio Cassis? Listening to him, one gets the feeling that Switzerland is world-class…

That depends on which Switzerland we're talking about. I find the level of solidarity of the Swiss people remarkable when it comes to donations or families hosting Ukrainians displaced by the war. Politicians too have taken action – the Confederation, for instance, has endorsed the sanctions and has so far made more than 100 million francs available for humanitarian aid. Of course we could and must do more, especially in implementing the sanctions. The Lugano conference for the reconstruction of Ukraine was also a positive signal. But Switzerland should now take an active part in the European reconstruction platform.

Foreign Minister Cassis missed the international conference on the hunger crisis held in Berlin in June – is there a risk that, like the hunger or the climate crisis, other crises could be forgotten?

It is true that public attention is focused on the war in Ukraine, because of its global dimension and the fact that it concerns a nuclear power. But the dramatic nature of the hunger and climate crises cannot be overlooked. People here are becoming ever more aware that everything is interrelated. According to an ETH study, this is why the majority of the population favours expanding international cooperation. It brings stability and prospects for the future.

Citizens are showing solidarity, but not the Parliament, which wants to increase military spending substantially. The coming years could therefore witness cutbacks in international cooperation owing to the debt brake. What can civil society do about this?

There are major financial challenges stemming from the overlapping crises. Our task is to show that in this situation, development cooperation should be strengthened rather than weakened. If we fail to do enough against global poverty and hunger, the resulting costs will be enormous. Let us not forget that Switzerland has still not yet reached the 0.7% target.

Federal elections are set for next year. Could global issues play a role in them?

I hope and expect that the parties will address the global risks, as they concern us all. Everything that happens in the world today also has something to do with us. The corona pandemic has made this abundantly clear. Today we live in a highly networked world, where it is imperative to enhance equal opportunities worldwide.

Where do you currently see the greatest challenges to international cooperation?

The burgeoning number of violent conflicts and extreme weather events – we need look no further than Pakistan – is creating great demand for humanitarian aid. It saves lives and fulfils people's immediate and basic needs. At the same time, we can ill afford to neglect long-term development cooperation and peace building. Ultimately, these are the only means by which to create long-term prospects and fair opportunities for all, so that people can lift themselves out of poverty. Helvetas brings all these dimensions together. In refugee camps, for example, we provide not just emergency relief, but also educational opportunities.

Time and again we hear the criticism to the effect that the development cooperation work being done by so-called "white saviours" is perpetuating post-colonial patterns. Does this also apply to Switzerland?

The criticism applies less to Switzerland than to major international organisations. Switzerland's development cooperation work is more locally embedded. Helvetas too has always worked closely with local partners and the local people.

But couldn’t the important work being done with local organisations be better communicated?

Absolutely. But we are already very transparent about the impacts of our work and the key role of the local people in it.

What is your view of cooperation with the private sector? Is it more of an opportunity, or is it a risk?

This has always been one of the priorities of Swiss development cooperation. We too have had good experiences in many countries in terms of promoting small and medium-size enterprises and local value chains. The rules are the all-important factor: if all enterprises respect labour and environmental rights, injustices will also diminish. International corporations, in particular, have enormous leverage in this regard.

And what is the role of the political class in this?

For the Swiss public, it goes without saying that Swiss companies abroad should observe environmental standards and human rights. The discussion surrounding the responsible business initiative has borne this out. If the Federal Council takes its promises seriously, then Switzerland must now follow through in the realm of oversight and accountability.

The 2030 Agenda and its sustainable development goals have so far had little impact. Not much is known about them in Switzerland, and companies are exploiting them ever more frequently for "green washing". Should we perhaps concentrate more on implementing individual goals?

Broadly speaking, people feel more drawn to concrete issues. This is why it undoubtedly makes sense to highlight the individual goals. If the climate crisis, for example, is preventing other countries from producing enough food, that is also a problem for us here in Switzerland. The solution lies in dovetailing global and domestic food policy.

And how can Switzerland be persuaded to assume more responsibility in climate foreign policy?

We have to draw attention to the size of our footprint and the degree of influence exerted by the Swiss financial and commodity trading hub. Regrettably, many negative impacts can no longer be averted. Switzerland bears some responsibility here: the country must better assist the poorest countries with implementing resilience and adaptation measures. That will not be possible without additional sources of funding.

Are today's crises an opportunity for our work?

Paradoxically, yes. Raising the profile of the problems can lead to greater readiness to act. If supply chains are suddenly paralysed, if there are food shortages and energy bottlenecks, then there is only one way out – more cooperation, justice and fair opportunities. What is needed now is for us to highlight and elucidate the potential benefits of development cooperation.

But most people in Switzerland are more concerned about their own pension arrangements or rising health costs than about the situation in East Africa, for example…

Our quality of life is also dependent on how people are faring in the poorest countries. A world in which there are many losers is not a pleasant one. A world in which many people have nothing left to lose is a dangerous one. As a historian, I know that times of crisis are often marked by outbreaks of violence. This makes international solidarity all the more crucial. It is the prerequisite for peace and stability.

And what is your message for young people who have lost all hope?

I am a child of the cold war. When I was 20 years old, I spent every day anticipating the possibility of a nuclear war; that motivated me to get involved in politics. I know from experience that tenacious engagement pays off and that there are many positive developments and solutions.

global

Article, Global

The age of white saviours is over

05.12.2022, International cooperation

Power inequalities are still a major problem in development cooperation. Change is under way where decolonization is seriously being promoted.

Kristina Lanz

Expert on international cooperation

Doctor, philosopher, theologian, organist, Nobel Peace Prize winner - and a "white saviour"? Albert Schweitzer (1875 - 1965) in Lambarene, Gabon.
© The Granger Collection, New York / Keystone

Development cooperation (DC) has changed radically over the past 30 years. However, despite progress on many fronts, many people still retain a very colonial image and understanding of development aid: on one side there are mostly dark-skinned, poverty-stricken people, seemingly incapable of lifting themselves out of poverty on their own; and on the other, overwhelmingly white, altruistic helpers, who are using their knowledge and expertise as best they can to help the poor.

Correcting this (self) perception and shifting the power to define and make decisions about development from the North to the South is at the heart of discussions on the decolonization of aid, which have gained considerable momentum in recent years. Launched by humanitarian organizations in the Global South, the debate is now also taking place in academia and has long found a place in the work of many international non-governmental organizations (NGOs).

This article highlights three aspects that are pivotal to a new, decolonized understanding of development aid: the historical and political contextualisation of development cooperation, a complete revision of the images and narratives that are being conveyed by development actors, as well as the ongoing evolution of the modalities of cooperation.

Altruism or self-interest?

In an address to the nation in 1949, US President Truman spoke for the first time of rich, "developed" nations having to use their progress to assist poor "underdeveloped" countries with their development. Poorer countries – with the assistance from the richer nations – needed to create the general political and economic framework conditions, which would bring them closer to the living standard of the latter. Whereas Truman's primary motive at the time was to curb the rise of communism in poorer countries, European colonial powers also embraced the concept of development aid, as it allowed them to preserve their influence in the now independent colonies, while burying the horrors of the colonial era behind a smokescreen of altruistic aid.

From the very beginning, development policy frameworks propagated by the West were designed to preserve Western political influence as well as access to the vital commodities and resources of poorer nations. This so-called development aid furthermore often had conditions attached to it in order to secure markets for Western companies in poorer countries – a practice that has come to be known as "tied aid".

As of the 1960s, the Western-dominated global financial institutions (World Bank and IMF) also played a key role in the realm of global economic policy. After many of the newly independent governments contracted massive debts with the World Bank and the IMF in the 1960s and 70s, most often to build major (generally export-oriented) infrastructure projects, new lending in the 1980s was tied to strict conditions regarding market and trade liberalization and a roll-back of the state. While these so-called structural adjustment programmes (SAPs) promoted global economic liberalization, poverty and hunger increased exponentially in most of the "structurally adjusted" countries. In parallel, numerous NGOs emerged and took over the work of States weakened by the SAPs, for example in the areas of education, health or water and sanitation (WASH).

It was only in the 1990s that an initial phase of self-reflection in the development sector took shape – on the back of massive civil society protests against World Bank and IMF policies, as well as increasing internal and external criticism of the top-down agenda of the development industry and its failure to alleviate poverty. From then on, more attention started to be paid to topics such as human rights, governance and political context analysis and measurable poverty reduction was now given a central place. Furthermore, the issues of coordination among donor countries, as well as the increased cooperation with various players in the Global South (ranging from governments to civil society organizations) started to gain relevance. As a result of these deliberations, at least officially, the term “development aid” was replaced by “development cooperation”.

Outdated images of development

While the practice of "tied aid" is frowned upon in development cooperation today much more emphasis is being placed on human rights and the rule of law, and the principle of “cooperation” has become more important, the colonial image of the "white saviours" still persists. This image also stems from the conviction that development is something linear and that we in Western industrialized countries have achieved an ideal state of development thanks to efficiency, intelligence and innovation. Forgotten are slavery, imperialism and colonialism, as well as unfair global trade and economic relations, which are still in place today and without which Western prosperity would not exist in its present form.

Whether knowingly or not, today's development cooperation still continues to reinforce an outdated image of development through its communication and fundraising activities – an image inspired by stereotypes of poverty, white saviours and a lack of contextualization. Even the language used in development cooperation can reinforce these images – for example, the frequently used term "capacity building" implies a lack of knowledge and capacity on the part of local people and organizations. In a recently published open letter, 93 Ukrainian organizations and more than 100 individuals sent a clear message and a challenge to international organizations and NGOs: Stop speaking on our behalf, and stop spinning narratives in such a way that they promote your own institutional interests! The member organizations of Alliance Sud and other NGOs have recognized this problem and have jointly launched a manifesto for responsible communication in development cooperation.

Cooperation modalities

Besides the urgently needed revision of the images and narratives being disseminated by development actors, the modalities of cooperation between Western donors and local recipients are also eliciting criticism in the current decolonization debate. Civil society organizations from the Global South, who are doing crucial work in numerous fields – from protecting human rights and combating poverty to environmental protection and the fight against corruption – feel sidelined in present-day development cooperation. They denounce the fact that decisions are made mostly in the West, that they often act as mere implementing partners for projects decided by Western development actors, who do not trust them and that their local knowledge is hardly ever valued.

The fact is that international development is still dominated by Western "experts" and that there are huge disparities not only in the salaries of expats and local collaborators, but also in their powers of decision-making and action. Furthermore, an OECD study published in 2019 shows that only about one per cent of overall bilateral development funding directly went to local organizations in developing countries. The study also shows that civil society organizations are used preferably as implementing partners for donor-country projects and priorities and are seldom regarded as autonomous development actors in their own right. Access to funding, especially for small, local organizations, is being massively hampered by complex bureaucratic procedures and requirements and competition from larger international organisations.

The future of development cooperation

The debate around the decolonization of aid is crucial, in that it demonstrates that development cooperation is not free of outdated colonial thought patterns and behaviours. However, it is also important to avoid generalizations in this debate. The history of the World Bank and the IMF is different from that of the UN, of bilateral development cooperation, or of NGOs. And while development cooperation as a whole may still fall far short of a fully decolonized, partnership-based cooperation, much has changed for the better in recent years. Human rights and democratization have become more important, the localization and decolonization of development aid are now being seriously discussed and promoted at various levels. Several NGOs, for example, hire mainly local staff in their offices abroad or work exclusively with local organizations, in keeping with the principle "locally led and globally connected". Besides, the work of many international organizations and NGOs has become more political: global injustices are being denounced and tackled jointly with NGOs in the South.

It is also important to always situate development cooperation in an overall context. While many policy areas still effectively facilitate the transfer of resources and value creation from the Global South to the Global North, as well as the exportation of unwanted waste back to the South, development cooperation constitutes one of the few policy areas in which funds) can flow back from the North to the South in a manner more or less devoid of self-interest (depending on the country and institution) and in which global problems can be jointly tackled.

For the future of development cooperation, it is now important to ensure that words are followed by deeds, that existing patterns of funding, knowledge generation and cooperation are broken in order to truly share decision-making power and make room for non-Western ways of thinking and acting: only in this way will true cooperation among equals become possible. Furthermore, a clear, new narrative must be constructed – shifting away from "aid" towards Western responsibility and compensation, away from "developed" countries and countries "to be developed", from "helpers" and "beneficiaries" towards shared global learning and development processes that work towards global sustainability and justice.

Many of the problems currently facing poorer countries originate in the Global North: unsustainable commodity extraction that involves human rights abuses, tax avoidance, illegitimate and unlawful financial flows, or the worsening climate crisis are but a few examples. Now more than ever, tackling the root causes of these problems will require cross-border networking and cooperation on the basis of partnership.

global

Article, Global

The future of Development Effectiveness

20.03.2023, International cooperation

The third High Level Meeting (HLM3) of the Global Partnership for Effective Development Cooperation (GPEDC) ended with mixed results, says Vitalice Meja, Executive Director of Reality of Aid Africa.

Vitalice Meja is the Executive Director of Reality of Aid Africa – a pan-African organization with a focus on poverty eradication through effective development cooperation policies. He is currently one of the GPEDC Co-Chairs representing non-executive members of the GPEDC.

Held in Geneva Switzerland in December 2022, the meeting brought together several hundred government officials, development partners and other development players. It endeavoured to take critical steps to strengthen the impact of development cooperation in delivering on the 2030 Agenda for the benefit of those most left behind. The meeting also took place at a time when the COVID-19 pandemic had not only led to the loss of hard-won development gains, but also when questions about the relevance of the effectiveness principle in the current crisis-ridden context were gaining momentum. The onus on the summit was to demonstrate how development effectiveness principles could help bring more resilience to development results and impacts, for the purposes of the SDGs. In this regard, the summit attempted to place trust building at the heart of the GPEDC agenda and its outcomes. The objective was to secure a political commitment from all actors to change the way they partner, by resolutely making the effectiveness principles more central to outcomes and accountability at the country level.

State of Play

It is safe to say that the GPEDC’s mandate and effectiveness principles are as relevant as ever. It was on this basis that the GPEDC rolled out a new monitoring framework and an overhauled delivery model that was unanimously endorsed at the summit. By the time of the summit, over 36 developing countries had signalled their intention to participate in the next monitoring round. The country dialogues, partner country caucus and thematic focus approved at the summit also provide considerable impetus for launching the new delivery model at the national level. All indications are that there is still a high level of interest in accountability and in making progress on GPEDC commitments.

We must, however, act decisively and not selectively to implement the new monitoring framework and the new delivery model if we are to strengthen the platform in the context of the 2030 Agenda. Sustained efforts are needed to make the GPEDC more operational and results-oriented at the national level, and also to promote inclusiveness through a whole-of-society approach. The GPEDC leadership should capitalize on the opportunities offered by the bold political outcome document to spur progress towards country-level action. There must be increased uptake of GPEDC outputs and products to inform and guide changes of behaviour on the part of countries and at headquarters, and adequate financial resources must be allocated for this purpose.

Challenges

We must nevertheless address the fact that the persisting external perception is that the GPEDC is donor-driven and that whatever is funded by donors attracts attention and investment from the global platform. This perception does nothing to strengthen ownership among partner-country governments. Creating a global community dedicated to pursuing the principles will require bold political action across all constituencies, and development partners will have to be willing to engage in the political debate.

Funding and capacity constraints have persisted throughout the decade-long existence of the GPEDC. However, there are new demands for all actors to assess their capacity to deliver. With the new monitoring exercise and delivery model, the GPEDC must urgently consider members’ capacity gap and the support needed to spur action, including at the country level. If we are to succeed, both responsibilities and the relevant resources must be clearly designated, for the sake of better pursuing the aims of the GPEDC at the country level.

An inclusive and sustainable GPEDC will depend on a shared understanding of how to respond to new risks, trade-offs and tensions in partnerships at the country level. This requires continued multi-stakeholder dialogue to rally all actors around agreed actions that are guided by the 2030 Agenda and national development priorities. Concerted investment by all stakeholders will be needed to address persisting and new challenges of effectiveness, and to ensure a focus on agreed development priorities, and on first helping those who are furthest behind. Underpinned by collective approaches to accountability, this could generate much-needed momentum for harnessing the strengths of governments, citizens and other partners in order to ensure greater deliverables and speed up progress along the path of sustainable development.

global

Article

"We do not want an endless war"

15.06.2023, International cooperation

There is little evidence of a move towards peace in the context of the war in Ukraine. Perhaps because no one knows what "making peace" would mean in this instance.... Interview with Thomas Greminger, Head of the Geneva Centre for Security Policy.

Isolda Agazzi

Expert on trade and investment policy / Media relations French-speaking part of Switzerland

At the organisation for Security and Cooperation in Europe (OSCE), Thomas Greminger played a key role in managing the crisis spawned by Russia's annexation of Crimea in 2014. Prior positions held included serving as Head of the Human Security Division of the Federal Department of Foreign Affairs (FDFA), and also as Head of the South Cooperation Department of the Swiss Agency for Development and Cooperation (SDC). Between 2017 and 2020, Thomas Greminger was Secretary-General of the OSCE. In international Geneva, he is a proven expert on peace in Ukraine.

Alliance Sud: You have been a powerful advocate of mediation and peace promotion in the OSCE framework, especially in Ukraine following Russia's annexation of Crimea. Isn't Russia's invasion of Ukraine in 2022 proof that those efforts have failed?

Thomas Greminger: In the years 2014 and 2015, we successfully averted the escalation of the crisis in Ukraine; but it has never been possible to eliminate the conflict between Russia and Ukraine and its underlying tensions between Russia and the West. The West has always insisted that NATO is a defence alliance with no interest in attacking anyone, and that many countries were keen to become members out of fear of Moscow. Yet the west has failed to recognize that Russia has harboured legitimate security concerns and an age-old feeling of being threatened by the West, and which has its roots in the age of Napoleon and in Hitler's Germany. While Putin has indeed exploited all this as a pretext for pursuing a revanchist agenda, Russia's security concerns should be treated as legitimate. Lastly, we must admit that no international organisation is in a position to prevent a superpower from going to war – not the UN, not the OSCE.

Is a peace agreement conceivable in the present circumstances? And if so, would that mean surrendering 20 per cent of Ukrainian territory to Russia?

Calls are now being heard for a Plan B. Plan A consists of supporting Ukraine on the battlefield, for as long as it is willing to fight. The dominant opinion at present is that we should await the outcome of the spring offensive for both sides, after which it may be possible to return to the bargaining table to work out a ceasefire and perhaps even a peace agreement. Owing to a range of problems, primarily issues of territory on which neither party is prepared to compromise, that would be a major challenge. It is most unlikely that either of the two positions will prevail, neither that of Ukraine, which wants to liberate all the areas occupied since 2014, nor that of Russia, which is keen to consolidate all the territory it has annexed. We have no wish to reward Putin by approving his redrawing of the map by military means, but nor do we want an endless war. The transitional solution would be the temporary cession of territory similar to what took place between East and West Germany after the Second World War, or between the two Koreas. What is at stake is therefore not the surrender of territory in the narrow sense of international law, but agreeing to a temporary cession, which could be renegotiated under a future Russian government.

What would happen next?

The second issue would be the security guarantees that would be given to Ukraine against future attacks by Russia, and whether the country joins NATO or declares itself a neutral State. The Ukrainian Government would like NATO membership in order so that the country would enjoy the guarantees available under Article 5 of the Washington treaty. It seems politically difficult, however, given the resistance from certain NATO members, and considering that Russia would find NATO membership for Ukraine unacceptable. Then there is the question of compensation in connection with the adjustment of sanctions, and the matter of war crimes. There are four sets of issues that would have to be negotiated in the framework of a peace agreement.

At present, both Heads of State are keen to prosecute the conflict on the battlefield. they have no interest in sitting at a negotiating table, as both believe in a military victory. Should either side develop a different viewpoint, this could change.

Switzerland's renowned good offices seem non-existent in this instance. Are they, and if so, do they need to be reinvented?

The warring parties are showing no interest in traditional arbitration and mediation. Turkey's offer of mediation is based on power interests; the country is playing its role as a regional power, and President Erdogan enjoys access to both Heads of State. That is not the type of mediation that Switzerland or Norway could offer, and even if Switzerland had not adopted sanctions, its services would not be called upon.

According to Russia, sanctions have placed us on the list of "unfriendly" countries; the Syrian Constitutional Committee can now no longer meet in Geneva. But international talks on Georgia are continuing in Geneva, with Russia's participation. The Russians are highly pragmatic, they come to Geneva if they have the feeling that there is something in it for them. This also applies to a whole range of informal dialogue platforms provided by the Geneva Centre for Security Policy (GCSP).

The West is finding it ever more difficult to understand Switzerland's neutrality. Is it still in step with the times?

It is true that our neutrality has come under attack especially from Western countries. But from the standpoint of international Geneva, neutrality is much appreciated by all other countries, including those in the Global South, and Western nations welcome the dialogue frameworks we provide for controversial topics such as the Arctic, Syria, and nuclear weapons. In a highly polarised world, even the West has an interest in neutral States that can provide space for dialogue and negotiations. Neutrality has by no means lost its raison d'être, despite the pressure being exerted on it.

Meanwhile, Switzerland has most unequivocally endorsed the western values of human rights, the rule of law and democracy. In that connection, Switzerland underlines the view that neutrality is not a matter of values. At the same time, it is gratifying that Switzerland has not joined the camp of those providing military support to Ukraine, a move that would undermine the impartiality of a country that is host to so many international organisations.

According to the Ukraine Support Tracker, compared to other countries, Switzerland is not doing much to help Ukraine. Should the country step up its involvement, and if so, how?

In terms of the overall sum of the support being given to Ukraine, Switzerland seems not to measure up particularly well in this ranking, as it also covers military aid (weapons, munitions), which is very costly. It is hardly surprising, therefore, that Switzerland ranks a mere 28th. Things look much better when refugee spending (17th place) is included.

This is an indication that over the near-to-medium term, Switzerland will be under pressure to offset the lack of military support in some other field. By way of burden-sharing, we could find ourselves forced to contribute substantially in other areas such as humanitarian aid and reconstruction in Ukraine. Switzerland will come under growing pressure to do more than is presently the case. There will also be greater pressure to make savings in other areas; many countries in the South are nonetheless suffering as a result of the war and it would be unwise to cut back development cooperation in other parts of the world. Beyond the realm of humanitarian aid, this would enable authoritarian countries like Russia and China to expand their influence in countries of the South.

Should Switzerland authorise the re-export of war materiel?

We would do better to concentrate on the things we do well, as described above! The re-export of weapons will never significantly impact the war in Ukraine. As a country guided by the rule of law, we are required to apply current law. If the Federal Act on War Materiel prohibits this, we cannot permit re-exportation – unless the law is amended. If there is the will to do so, then we can, but it takes time. As things stand, we are bound by current law.

Alliance Sud is calling for a global security policy to avoid future wars. What do you think of this?

In my career I have always stood up for development, peace and security, and constantly underlined the linkages between these fields. As a country whose economy is so internationally oriented, Switzerland is dependent on stable international relations. This also includes fragile States. The countries hardest hit by the consequences of warfare, food and energy insecurity, political unrest, inflation, etc., are fragile States. Economies with below-average development are more vulnerable to ethnic, social and international conflicts. Investment in cooperation reinforces the resilience of fragile States, and can reduce State failure and the potential for conflict, with the result that less people are forced to leave their homelands. Development policy is conflict prevention policy.

Interview: Isolda Agazzi

An independent, federally funded foundation

The Geneva Centre for Security Policy (GCSP) is an independent foundation comprising 53 countries and the Canton of Geneva. The foundation was set up by the Swiss Confederation, which funds 70 per cent of its budget. It is headed by Swiss career diplomats (like Thomas Greminger at present) on whom the Federal Council confers the title of ambassador in that role. It is therefore both international and Swiss in character, but depends on Switzerland's political and financial support, "although we do enjoy a high degree of independence that is respected by Berne", says Greminger. "We abide by the three principles of independence, impartiality and inclusiveness – and this latter principle in regard to gender, geography and political persuasion, as we bring together people with a range of opinions."

Since the outbreak of the war in Ukraine, the GCSP has maintained its unbiased and integrative training programme for leaders, in spirit and in practice. Courses are still being run with Russian and Ukrainian participants. The GCSP provides room for informal dialogue and tackles issues relating directly to the war, and indirectly to topics no longer being discussed at government level, such as the nuclear weapons dialogue between the USA and Russia.

Subscribe to Development cooperation