Brussels urged to become hub for new MDG fund
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Unless it acts soon, EU will be left behind as an aid donor
London, 27 June 2006 (ODI) Brussels should become the hub for a new 5 billion fund to address the Millennium Development Goals (MDGs) according to Simon Maxwell, Director of the Overseas Development Institute (ODI). Through greater collaboration, the European Union (EU) could become one of three major global players, taking its place alongside the World Bank and the United Nations. Maxwells comments come as the first anniversary of the G8 commitments to Africa approaches, and in the wake of the formation by British Prime Minister Tony Blair of an Africa Progress Panel to monitor the aid pledges made at Gleneagles last year. The EU offers the possibilities of economies of scale over the many bilateral programmes of member states, states Maxwell. And it has other advantages, associated with its trade and foreign policy mandates. Those advantages are linked particularly to the role of the Commission as a development actor. Though the European Commission is already a major donor (7 billion of official aid in 2004), it accounts for only 20% of all aid from European countries, with most (about two thirds) still being bilateral, and the rest channelled through the UN or the multilateral development banks. The multilateral share varies a great deal between countries: in the case of Italy for example, it is close to three quarters, in the case of Sweden, only one quarter. Maxwell finds the apparent reluctance of the EU to take a larger, more central role surprising: If Europe doesnt route more money through its own multilateral channel, the EU will be left behind as an aid donor. Indeed unless action is taken, the market share is likely to decrease. With the European Development Fund fixed in monetary terms, and the recent budget settlement fixing the size of the external budget to 2013, there seems to be little scope for the EC to absorb its share of increasing aid volumes. As the MDG target dates move closer, and with so much still to achieve in reducing global poverty, Maxwell asks: Isnt it time for Europe to step up its response? Globally aid is increasing rapidly, but it needs to be appropriate, untied and directed to the needs of the poorest. He goes on to warn: If we dont do something like this fund, the European role in the aid industry will inevitably shrink. This special fund would be open to poverty-reducing activities in all poor countries, and governed in a transparent and accountable way. Donors could contribute to the fund on a voluntary basis. A new role and new Fund could make us truly proud. (ENDS) Notes 1. Simon Maxwells new ODI Opinion, Where Europe Stands in the New Aid Architecture and Why We Need a New 5bn European MDG Fund is available at: http://www.odi.org.uk/publications/opinions/70_eu_mdg.pdf 2. ODI is Britains leading independent think-tank on international development and humanitarian issues. Its mission is to inspire and inform policy and practice which lead to the reduction of poverty, the alleviation of suffering and the achievement of sustainable livelihoods in developing countries. Locking together high-quality applied research, practical policy advice and policy-focused dissemination and debate, ODI works with partners in the public and private sectors, in both developing and developed countries. Further details can be found on the ODI website: www.odi.org.uk. Overseas Development Institute 111 Westminster Bridge Road, London SE1 7JD Tel: +44 (0)20 7922 0300 | Fax: +44 (0)20 7922 0399 | E-mail: media |
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