Dov Zerah, chief of the French Development Agency, or AFD, likes to say he has brought a bit of Africa into the organization.
Born in Tunisia, Zerah, 55, is, in fact, a proud product of the French establishment. Educated at the Ėcole Nationale d’Administration, the training ground for France’s governing elite, Zerah is a career civil servant who was a long-time official at the Treasury and managed ministerial cabinets in Paris and Brussels.
Like many French public officials, Zerah is a savvy political operator. He has long maintained close relations with French President Nicolas Sarkozy and currently holds a city councilman post in the posh Western suburb of Neuilly-sur-Seine, where Sarkozy was once mayor. In his new position as head of the agency that manages French assistance to the developing world, it helps to have friends in high places.
Zerah is no stranger to development issues, having served as associate chief executive officer of the Caisse Française de Développement, from 1993 to 1995. He then managed France’s complicated commercial cotton dealings with former colonies in Africa from 1999 to 2002.
He took the helm of AFD on June 2, inheriting executive authority over an agency with more than 1,400 staff and the ability to commit billions to development aid as it did in 2009 when it pledged 6.2 billion euros (USD8.1 billion) to aid financing.
Devex spoke with Zerah in July about his vision for the AFD. Not surprisingly, he explained that he hopes to keep Africa at the center of AFD’s activities while working to boost pan-European aid cooperation.
You’ve been [head of] AFD for six weeks now but you already know your way around the place, right?
That’s the least thing you can say! I’ve gotten into the habit of [stating at] board meetings that I’ve practically held every post here. I’ve been an observer, a nonvoting director, a director. And now I’m the chief executive officer, sitting at yet another place at the table.
With that kind of experience, you know that AFD is a relatively stable organization. But since you’ve just arrived, you must have some ideas about putting your own vision into action.
AFD has gone through a profound mutation, if not a revolution, over the past 10 years. Its geographic zone of action has expanded. The sectors in which it can be involved have grown and the scope of its operations have risen five-fold. Any new director-general who arrives after a period of profound mutation like this is necessarily going to be responsible for consolidation regardless of who he is.
In this context, I see two key shifts that we have to consider. Neither calls into question the work that has always been done here but instead seeks to evolve in the right direction. The first shift concerns Africa, which is growing at around 5 percent annually. We have to do more to accompany this growth and help it accelerate. Reinforcing African economic growth will require greater support for activities that create value, like agriculture. I’m trying to put the [emphasis] there, and we’ll definitely take initiatives toward the development of agro-industry across the south. Now, obviously, if farm products are going to get out, you have to have roads. So, we’ll also be more involved in infrastructure projects. And to transform agriculture products you need energy. So, we are going to support projects across the energy sector, particularly solar energy. These are the first steps we’re going to take to try to reinforce growth trends underway since 2005 across Africa.
The second shift is in the methods we use. The AFD has grown so fast in the past few years that it has not necessarily taken the time to explain what it does. To explain what it does to MPs and senators, to the ministries that oversee its work, to the public. There’s a disconnect between public opinion about who we are and reality. So, we’re going to seize the opportunity of the 70th anniversary of the creation of the agency, in 1941 in London, to launch a substantial communications campaign.
Are there any specific institutional or administrative reforms planned? Any specific programs or processes that may be re-evaluated?
No. I think we could spend a lot of time discussing whether to put more emphasis on the different geographic areas where the agency operates, or whether we should put more resources into better acquisition of themed transversal organizational skills.
That doesn’t mean we won’t do some adjustments here and there. Of course, we will. We’ll be obliged to make some changes to take financial constraints into account. But we’ll handle these as they arrive.
Speaking of financial constraints, the last few years have been fairly good for AFD in budgetary terms. But today the key message coming from the French government is “austerity.” Just recently, we heard Foreign Affairs Minister Bernard Kouchner talking about billions of budgetary savings. How do you see the current financial situation of the AFD, particularly in light of the financial crisis?
During a meeting with African heads of state, just prior to the Bastille Day celebrations, President Sarkozy reaffirmed that France will maintain its development aid efforts. So, we should have a subsidies budget that will allow us to continue working on our principal priority areas. As for concerns about interest on the funding we offer, [interest] rates may be a bit higher, but we’ll continue to offer loans.
You mentioned the different types of state funding you receive – direct funding to subsidize projects and financing assistance. Can you briefly explain how AFD is funded and overseen and what the agency’s relationship is with the French Foreign Ministry?
It’s actually quite simple. The government is our unique shareholder, represented by the ministry of economy and finance, that verifies what we do and how we manage our operations. What we do is linked to French foreign policy, so we obviously have to work in close coordination with the foreign ministry. But, we also intervene across France’s overseas territories, so we also cooperate with officials in the overseas territories. Everything we do is discussed and negotiated with representatives of the concerned ministries, who are part of the AFD board. We also have a more informal strategic oversight council where the different public authorities coordinate their actions and [express] what they expect from AFD.
The French foreign ministry also has its own development assistance budget.
Yes, there is one part of French aid which is multilateral, and another which is directed to us via the foreign and finance ministries. And then the foreign ministry has a small budget for its own direct actions.
There’s a lot of discussion here in France right now about reducing the size of the public sector. Where are you in terms of employment?
We are not directly concerned by this discussion. We will continue hiring. That said, the agency has recruited a lot [of staff] over the past five years: 500 people. And one-third of all employees now have less than five-year seniority. So, we’re currently studying, in line with budgetary expectations, further adjustments that may have to be made. But, otherwise, we’ll continue hiring. If anything there may have been a bit too much interim hiring in the administrative and financial sectors and not enough of legal experts or project managers.
How is AFD participating in the preparation of the French contribution to this September’s Millennium Development Goals summit in New York?
We are feeding into the work being done by the foreign ministry and the Treasury on a comprehensive French position. There are clearly areas of specific importance for us, such as global public goods, that didn’t really exist in 2000. There’s also climate change. When you look at the last 10 years, since the adoption of the MDGs, a lot has changed and we have to take that into account, notably as concerns on global public goods, climate change and projects are designed to create value.
Creating value is very much a private sector concern. Are there specific countries or regions where you think development projects can help the private sector do more?
Take Africa, for example. There are a number of countries where there’s strong economic activity today coupled with a growing private sector: Burkina Faso, Mali, Senegal, Ghana, Nigeria, Uganda and, of course, South Africa. But there are also other countries across the world where we think we can do more to accompany private sector growth.
You mentioned earlier three linked priority sectors in Africa — agriculture, infrastructure, and energy — for AFD. It’s well-known that you have some specific experience and interest in the cotton sector, which seems to bring all of that together.
You know, I was head of the French government’s cotton sector company for three years. So, it’s something that’s really important to me. We have a great opportunity today. Cotton prices are rising and exchange rates are more favorable, so we’re in a very positive position toward jump-starting the cotton sector. We’re going to do all we can to accompany that growth. But it’s also a political question, reducing subsidies in industrialized countries.
France has always been a major player in the Middle East. Do you see any potential changes in the French development assistance policy given the slowdown of peace talks between Israel and the Palestinian Authority and the blockade of Gaza?
There is no change planned. As part of its plan to facilitate the peace process, France will continue supporting economic development and seeking to reduce inequalities and tension. We will continue to finance projects across the region.
How do you see the future of European development cooperation?
It continues to develop. We have partnerships with the European Development Fund and the European Investment Bank, which are increasingly important. But we also have partnerships with our German, Spanish, or British colleagues. We’re working together more and more. We’re trying to create an agriculture development fund. I think the European development sector – what you could call the Europe of development agencies – is already in motion.
Really? Because it still seems today that most European countries are actually working on their own. One government agency may ask another government agency to join a project but the project will still be run from one capital or another. Does a European development cooperation policy really exist today or is it still a work in progress?
You know, something as big as the European integration project is going to be called into question, from time to time, and we have to constantly work to reinforce it. [We do not want] to exaggerate, [but] there are elements of cooperation and there are forms of partnership underway. Personally, I would like there to be more. I’m going to do my best to see [to it] that there’s more through a series of contacts and meetings that are already planned and underway. But, I do understand the demand for more and that there’s skepticism from some [sectors] about the reality of European development cooperation.
Any last thoughts on where AFD is going?
She’s going to celebrate her 70th birthday next year but she’s still a young old lady that is prospering. The agency did well over the last 10 years and should become even more aggressive at 70.