Early this year it was Canada and most recently Australia.
In the past few years, several traditional donor countries have re-integrated their foreign aid portfolios into the foreign affairs and trade department to produce synergies and cut costs. This is not new for Denmark, whose Ministry of Development Cooperation has long been under the broader Danish Ministry of Foreign Affairs. But now there’s concern that the development ministry may be taken over by the trade department.
“We fear that the ministry of development will be merged with the ministry of trade,” said Lehnart Falk, secretary general of the Adventist Relief and Development Agency.
The idea was prompted by aid groups’ observations of an increasing interest in the Danish government to engage the private sector in development cooperation. This was strengthened with the recent launch of Opportunity Africa, under which the European donor aims to combine its development cooperation efforts with foreign policy and trade. Falk told Devex he thinks this will be a “disaster” for civil society, as aligning humanitarian policy with trade priorities may leave CSOs out of development efforts funded by the Danish government — a similar concern expressed by several aid groups in Canada and Australia.
He thinks “aid for trade” is a misnomer: “While we do believe trade is important, there is plenty of documentation saying that the trickle down effect will not take place. We fear that [with a merger], this will be further strengthened, leaving … civil society out completely.”
Falk explained how in the current setup, money from the traditional pools is going to new funding mechanisms guided by trade priorities, rather than humanitarian or development needs.
“We, as most Danish CSOs, are scrambling to find new ways to handle this relationship. Right now we are reshaping our business [model] in order to go in and work with the market in some way or another. We are considering how we may find a place in the value change, having our strength working with the people on the ground,” he said.
Nathalia Feinberg, who heads the department of development policy and global cooperation of Denmark, however clarified with Devex that there “no plans for DANIDA (or its development assistance) to be taken over by the Ministry of Trade,” and added that any change of ministers “has no organizational implications.”
Denmark — a member of the OECD-DAC group of top development donor countries since 1963 — contributed almost $3 billion in official development assistance in 2011, and remains one of only five DAC donors that meet the goal of spending 0.7 of its GNI on overseas aid.
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