March 16, 2018

Development Cooperation in the EU: Estonia’s Views as Presidency

AP/Scanpix
Local residents wait for humanitarian aid distribution by EU humanitarian program in Semonovka, Eastern Ukraine, Thursday, March 17, 2016.
Local residents wait for humanitarian aid distribution by EU humanitarian program in Semonovka, Eastern Ukraine, Thursday, March 17, 2016.

The topic has become increasingly important among Estonia’s priorities

The topic has become increasingly important among Estonia’s priorities

If there were one field in which Europe is the unequivocal world leader, what would it be? No, not national defence, of course. Nor trade, even though the EU is the largest economic bloc in the world in terms of both economic and trading volume.
The EU, together with its member states, is the clear leader in development cooperation and humanitarian assistance, providing over two-thirds of globally recognised development assistance—99 billion US dollars out of 143 billion dollars, according to 2016 statistics from the OECD’s Development Assistance Committee (DAC). After the United Kingdom’s withdrawal from the EU, it will still be significantly over half of the world’s contribution to development cooperation and humanitarian aid. The EU’s contribution has increased in recent years and will probably increase further in the future. This is surely a fact every European can be proud of.
So it is even more ironic that the field of development cooperation does not receive much attention in Estonia, and not very much in Europe either. (For example, Politico—which, as far as the author is aware, provided the most thorough assessment of Estonia’s Presidency—did not cover development cooperation in its summary of the work Estonia did in that six months; the same holds true among larger areas, e.g. defence cooperation.)
Let us clarify some terminology. What is commonly referred to as development assistance actually encompasses two different activities—development cooperation (the term itself hints that the process is bilateral, where the parties are cooperating; furthermore, it is less stigmatising for the partner than being a receiver of assistance); and humanitarian assistance, where actual aid really is provided to those in need and which is a much more unilateral activity: this is the provision and acceptance of assistance. There is a transition between the two processes, of course—from humanitarian assistance after a crisis to development activities which should ensure the society’s resilience and a greater readiness to handle future emergencies, for example.
Estonia’s Presidency provided a rare opportunity to see behind the curtain of the processes that shape the EU’s policies in the field of development cooperation. Estonia’s own views and priorities have to this day somewhat deviated from those of the EU as a whole and will remain so for some time but, thanks to the Presidency, the understanding is much better on both sides.
The EU views the world from a global perspective; Estonia’s view is influenced by its historical experience and relies on this as well as on its own skills and resources, and also on a risk assessment of the future, which, from close up, is mainly targeted towards the East. Europe’s activities are guided by a mutually agreed global strategy that places importance on EU expansion (in the Balkans, i.e. basically within Europe, in the near future) as well as the neighbouring regions (Eastern partners are a clear and long-term priority).
The field of development cooperation is regulated by the European Consensus on Development, which concentrates on supporting the objectives for sustainable development, and places more emphasis on the importance of partnership and working at different levels of society. Europe as a whole, and increasingly Estonia too, sees major problems in the global South, meaning primarily Africa and the Middle East (which have been turned into everyday topics by the migration crisis). Global stability is also important to Estonia’s security. Societies can only be stable when their minimum needs are met—let us remember that, in the case of the migration crisis that has been giving Europe a scare, only a fraction of those who were forced to leave their homes arrived in Europe: some 90% of people remain near their homes, since they have no money to travel farther, or hope to return home soon. As a rule, this means that other developing nations (transit countries for the migration streams)—which have their own troubles as it is—must host millions of refugees. Looking at the rapid domestic developments and changing opinions, it is therefore likely that, within a decade, Estonia’s views will align more with those of Europe’s mainstream. This means that Estonia, too, will begin to pay more attention to Africa and the Middle East, especially if the Eastern Partnership countries—which Estonia has prioritised up to now—develop quickly.
Until last summer Estonia was still considered a recent entrant to the EU, being a small development assistance donor in absolute terms and still settling into some of the EU’s processes in its second decade of membership. However, the priority of development cooperation has increased significantly for Estonia in recent years; in terms of contributions (0.19% of GNI as of 2016) Estonia is in close second place to Malta among countries that have joined since 2004, and even ahead of some of the longer-standing member states. (Relevant OECD DAC statistics can be found online.)1
How did Estonia perceive things during its time in the limelight due to the Presidency, and how does it now? For the public, the most important event was the informal meeting of ministers responsible for development held in September in Tallinn. This was the first such meeting held in a Presidency’s capital for several years (the last was in 2016 in the Netherlands), which certainly increased the visibility of the topic’s important to Estonia as well as the bond between the ministers. The meeting involved the first discussion at ministerial level of digital solutions in EU development cooperation, as well as talks about cooperation with middle-income countries, commonalities between humanitarian assistance and development cooperation, and the EU’s External Investment Plan.
It is also worth mentioning the informal meetings, in June in Tallinn, of two very important working groups (CODEV and COHAFA—respectively the Working Party on Development Cooperation and the Working Party on Humanitarian Aid and Food Aid; the former meets in Brussels several times a week, while the latter is a monthly format based in the Presidency capital). Special attention should be paid to COHAFA’s field mission to eastern Ukraine (on the Ukrainian side of the contact line) in October, which Estonia organised to draw the attention of other EU member states to that area of humanitarian crisis, which is losing visibility. The effort was worth the contribution, because there is now discussion about other cooperation bodies planning to visit Ukraine this year.
Of the events that took place outside Europe, the most important was the African Union-European Union Summit in Abidjan (Côte d’Ivoire), with the Estonian Prime Minister in attendance, which will also open doors and offer cooperation opportunities to Estonia in the future. Under Estonia’s Presidency, the European Fund for Sustainable Development was created, which, as an innovative financial instrument, should help to involve private-sector investment in dealing with the primary causes of the migration problem in the vicinity of Europe—primarily Africa—while at the same time helping to achieve the goals of the UN 2030 Agenda for Sustainable Development.
How development cooperation is performed in practice—i.e. the activities and practices as well as the agents and workers: the so-called ecosystem of development cooperation, which includes the member states, EU institutions, NGOs and think tanks, as well as volunteers—has long been Europe’s forte and has been shaped over decades. The effectiveness of assistance has been discussed and problems examined for almost as long as development cooperation has been undertaken. There is still room for improvement in these activities, as probably in every other field of life.
It is impossible to formally assess or credibly prove that, without assistance, the situation would be far worse causing immense suffering, but this is quite clear just from looking at what is being done. The children of refugees would have remained without education, the mortality of babies in developing countries would be significantly higher, and the rule of law weaker—the list could extend to almost every area of society. Against this background, general progress can be seen. A longer perspective could be based on the statistics of the Oxford professor Hans Rosling, who died last year. (The author recommends watching his presentation on YouTube, titled 200 Countries, 200 Years, 4 Minutes, which is based on millions of data points.) If this is correct, the questions remain: who is developing and how, and can Europe be of help (to accelerate development): The answer is clear: yes, it can! In 2017 the author visited the poorest countries in Europe and in the Western hemisphere (Moldova and Haiti, respectively), and, rather than a feeling of hopelessness, a clearer picture of development needs there emerged. Estonia has provided assistance to both countries, and one of them is a priority in our bilateral development cooperation.
The need to “sell” and “prove” the result to funders as well as to the public steers assistance providers inevitably towards more risk-averse or tried-and-tested solutions. A road, bridge, school or hospital will still be there in years to come; everybody can go and look at it themselves or in a photo. On this basis, it is clear that nobody would want to justify the failure of a more innovative project. At the same time, there are plenty of occasions when locals cannot manage even maintenance tasks, whether due to lack of skills or lack of resources. This is how an assistance project may become a white elephant. When the first Estonian medical consultant arrived in Afghanistan, they found a decades-old hospital, built with aid money, where the oxygen system was not working. This means that in the world of development cooperation there is always a question of how to move forward.
In the light of long experience, new technological solutions seem very promising. Things can be done more efficiently, at best even skipping a stage in some narrow sector—this being a major leap in development. But how to persuade the assistance providers, whether private donors or taxpayers, that the supplied software and its implementation/training is really worth tens or hundreds of thousands and really moves the country forward much more than a couple of metres of asphalt road for roughly the same amount of money? Here, Estonia has it a little easier, because its assistance in absolute terms is so small (due to the size of the country and its economy) that it would be hard for Estonia to find an effective and complete infrastructure project in which to plant its flag for decades to come.
Thus, Estonia has believed for a few years that so-called e-development cooperation is a field in which it is possible to predict a tremendous amount of resources for the coming years and, it is to be hoped, a step forward in other matters. Based on its experience, Estonia has a clear advantage here to get involved. So what could be done? Estonia has a number of solutions ready to hand. It has built the first e-state with very limited resources, and knows that the process is long but that the sooner you begin the farther you can go. The relationship between citizens and the e-state is precisely the field in which Estonia has some of the best and deepest experience.
There follow some examples of what could be done and, in some countries, is already being done. This is all based on Estonia’s experience, so it is also recommended to our partners in addition to technological solutions to think about the legal environment, cultural differences, the educational level of the population and availability of technology.
One of the main things around which the e-state revolves is the citizens/population register, i.e. an overview of to whom the e-state provides services. According to the UN Sustainable Development Goals (SDGs), every country—even the poorest—has the obligation to document its citizens. Nowadays, why not do it electronically right from the start? When the population register already exists, one can move from there to other services. On the basis of a population register, a secure digital identity can be created, which is the foundation for e-communication between the state and the citizen (and also between a company and its clients), as in Estonia. Alas, such a simple, clear and secure solution is not the norm even in developed countries, to say nothing of developing nations. From there it is possible to move towards e-healthcare. Here the author is reminded of a statement by Margaret Chan, former Director-General of the World Health Organization, that if a cause of death is not known in the case of two-thirds of the world’s population, then how can medications be developed when we do not know what causes the most irreversible consequence in the therapy process?
There are more examples of how digital solutions can be viewed in the context of development cooperation. A citizens’ register would be a good foundation for an electoral register (to develop these separately seems a double expense, as the EU uses its resources each year to support the process of preparing electoral rolls). Participation in elections is a real opportunity for people to have a say in the political process and is the foundation of a society’s democracy and legitimacy. This is a problem in many countries—and technical capability alone will doubtless not resolve the democratic deficit when an undemocratic government is not interested in it. However, it creates the opportunity if there is a wish for transparent governance. With more courage and innovation, we can move from there to e-elections and other activities involving citizens.
An overview of the population is certainly important for the functioning of a land register/cadastre, i.e. the unequivocal identification of land ownership. All calculations show that public-sector funding is never enough to cover the gaps in development; it is therefore necessary to involve private capital by any means. The best option would be loans on reasonable terms. Interest rates in developing countries are often too high and this weakens business activity. One of the reasons for high interest rates is the absence of market-worthy and realisable security, which raises the lender’s risks. Most adults in developing countries possess only one piece of property with an actual price—their piece of land, which they cultivate. A loan could be taken out at a reasonable interest rate if the land could be reliably taken as security—so that it would be known where the land is located and who is its owner. As people in Estonia know, registers are the most effective way to ensure this.
If these things are already functioning, one can proceed, for example, to e-taxation. If the state has decided to tax its people this shows that the citizens have earnings and in turn creates the so-called institution of the taxpayer, or the citizens’ expectations of the government, which they receive in return for the tax paid. It is also important for the country to monitor the use of taxpayers’ money more effectively, decreasing or eliminating corruption and misuse—in turn creating the preconditions for the country that received the assistance to one day start operating on its own on the basis of its tax revenue.
In more developed countries the activities could be expanded by, for example, moving to an vehicle e-register and e-medicine—the first considers vehicles as capital eligible as security, the second enables medical services to be provided much more efficiently.
To which countries does Estonia provide assistance? Current priority partners are the already well-known Ukraine, Georgia and Moldova; it has also projects in Belarus, Central Asia and Armenia. Yet those are middle-income countries (MICs). It has been agreed on a global level that to raise the effectiveness of assistance, the nations most in need—i.e. the least developed countries (LDCs)—should receive the most assistance. Estonia now has the experience and knowledge, and the language proficiency, to be active in the above MICs. The author predicts that in the years to come the picture will change and Estonia will start to carry out more projects in the LDCs. However, in today’s environment, of utmost importance is an issue brought up by several EU member states concerning the continuance of support for the MICs, which was confirmed during Estonia’s Presidency. It is clear that there is no reason to stop contributing to save money in the short term, as this could lead to the deterioration of those countries, which in turn would mean more problems for Europe.
One of the most important results of the work of the Presidency in the field of development cooperation is the Council Conclusions that were adopted. Although the conclusions are too complex to be fully understood even by those with an average understanding of the EU machinery, these are the policies agreed by the EU that should function as a soft measure to guide all member states to act systematically and avoid duplication of operations.
If this is undertaken by a union that represents 500 million people and that can spend almost 100 billion euros a year, then this will have an effect. In the field of development cooperation, four Council Conclusions were agreed; the three most important were on digital solutions and development cooperation, a gender action plan, and trade support. The most important and visible of these was certainly digitalisation. The principles of a gender action plan, which were partly carried over to Estonia from the previous Presidency of Malta (although the rights of women and children is one of Estonia’s high-priority issues in development cooperation) and trade support will continue to influence the EU’s activities during the next several Presidencies.
Estonia wanted to help with the modernisation of the EU’s development cooperation and the improvement and efficiency of providing assistance—and digital issues, MICs, and resilience and innovation in humanitarian assistance (better cohesion of resilience, humanitarian and development assistance was one of the priorities of Estonia’s Presidency) support this broader objective. Estonia understood the need for the modernisation (the digital issues are an ideal example, where much more activity can be expected soon) and simplification of the EU’s development cooperation, and that to achieve the goals of sustainable development one must work on several levels and even small countries have a place in this process.
Estonia also “bequeathed” some pieces of work to the next Presidency, Bulgaria. Perhaps the most important of these is the agreement of a mandate for the post-Cotonou negotiations, which was impossible to achieve during our Presidency because the EU institutions did not come up with a mandate proposal until mid-December (it had been expected in the summer or autumn). The goal of the negotiations, which will begin at the end of the Bulgarian Presidency and must yield results within a year, is to agree on a cooperation relationship for the next period (the original Cotonou Agreement was for 20 years) with at least 79—perhaps more—African, Caribbean and Pacific states (the “ACP countries”). (The partnership may be expanded, for example, to North Africa and other Caribbean territories, or to Central America.) Although these countries are distant and Estonia knows little about them, a small country can never have enough friends and Estonia’s candidacy for a seat on the UN Security Council has put relationships with those countries on our agenda too.
We can also take satisfaction from the fact that the Presidency gave Estonia the opportunity to make the topic of development cooperation more comprehensible to the Estonian public—several conferences were held, Estonia was visited by European NGOs, and the European Commission ran a project to increase the visibility of development cooperation issues in Estonia.
In conclusion, the last six months of leadership in the field of development cooperation in the EU, together with the preceding preparations, can be seen as a thoroughly successful component in a very important field that has previously been undeservedly left in the shadows.
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1 A good starting point is www.oecd.org/dac/.