NGOs seek 'hope' in new EU multidonor trust fund for CAR

Nongovernmental organizations welcome the European Union's initiative to set up a multidonor trust fund for the conflict-ridden Central African Republic, but they are still waiting how the mechanism will play out in practice, and if it will be able to meet its objectives. The trust fund — named Bêkou, which means hope in the local language Sango — was launched Monday in Florence, Italy, followed Tuesday by the signing by the different donors of the constitutional act that allows it to start operations. The fund will have an initial 64 million euros ($86.69 million) in pooled resources, the bulk of which comes from the European Development Fund. An EU spokesperson clarified that the funds pledged by the European Commission are new and not pulled from other allocations, one of the concerns posed to Devex by several NGOs. It's unclear, however, if this is also true for the contributions of the other EU member states. Bêkou, the official explained, will allow other donors — member states, private organizations and even individuals wishing to send help in CAR but have no means to do so — to support the EU-led humanitarian and recovery efforts in the country. The goal is for the fund to help provide a comprehensive response in the country that covers not just relief, but also rehabilitation and long-term development. NGOs have been lobbying for such a mechanism globally for over a year now, Michael McKean, Mercy Corps' director of programs based in Edinburgh, told Devex. "Providing predictability of early recovery and long-term development mechanisms at this juncture in CAR's crisis will allow our teams to design programs with longer-term planning in mind, therefore building local capacity and ensuring the transition from relief to development is a factor in all phases of the crisis response," he said. The Central African Republic has been in turmoil since late 2012, and the conflict between government and rebel forces has not only not dissipated but escalated into a show of violence between Christian and Muslim militias and led to one of the world’s most neglected humanitarian crises. Faced with growing insecurity, many humanitarian groups opted to pull out of the country, while the few NGOs that decided to stay are struggling to continue their operations with very limited funds. "For decades, CAR has been an 'aid orphan' with very little investment in LRRD, but this announcement looks set to overturn that trend," Save the Children EU Representative and Director Ester Asin told Devex, adding that the trust fund could offer a "more flexible alternative to a multilayered crisis" in the nation. How the fund will work Details on how the fund will play out or who will be able to have access to it remains limited, as well as the information currently available to aid groups. Following the signing ceremony, the European Commission is expected to set up a board that will decide on how the fund will be used, as well as an operational committee that will be in charge of project selection, rules for implementation and follow-up. According to the official we spoke with, the range of funding modalities to be incorporated in Bêkou will be tailored to specific needs and objectives, and funding "may be provided" to NGOs, CAR authorities, international organizations or private foundations. "Preliminary work is ongoing to identify projects to be funded as soon as possible in the areas of the concentration of the fund," the spokesperson added, noting that some of the priorities is focused on restoring national and local administrations, and re-establishing economic activity and essential services like electricity, transport, health and education. The trust fund is not meant to address security issues — there's a separate EU instrument for that, but the official said "as much flexibility as possible" will be built in chosen projects to allow adjustments in case of dramatic changes in field situation. "Also as in the case of any project, it is normal that a project establishes an office, recruits a secretary, a driver and a security company to ensure the security of the offices. This is a normal part of project implementation," the EU spokesperson added. Bêkou is set up for a maximum duration of five years. The Commission will apply the same reporting and accountability features it employs in its development projects, and just the same, carry out annual external and independent audits of the fund. The European Commission's internal audit and the European Court of Auditors exercise the same competences vis-à-vis the trust fund as for other activities of the Commission. The EU is planning a donor conference for CAR in late 2014 to mobilize more resources for the fund, which “if structured appropriately, will be very useful," McKeann said. Pros and cons During the launch, EU Development Commissioner Andris Piebalgs called the fund "innovative" and a product of an "outside the box" thinking in dealing with a huge crisis. While multidonor trust funds are not new, this is the first time the EU is using one. And in a context like CAR, the European Commission thinks this will be a more effective mechanism that will allow actors to quickly respond on the ground and help combine donors' resources, expertise and respective strengths, whether they currently have a presence in the country or not. The fund also hopes to reduce administrative costs incurred by the government in coordinating international partners, and ensure the conflict-ridden country will continue to have sufficient funds for its recovery period. The usual danger is that when donors withdraw, funding dries up even when the government has not yet reached full capacity. In addition, as the fund pools resources, it can finance projects that require huge sums of money that otherwise are not as available when donors work individually. Alain Coutand, Action Against Hunger director of operations for Central and West Africa, agrees with the idea that this will provide a unique platform for donors not present in the CAR, but he is concerned that donors may concentrate most of their money through it, "hence limiting the diversity of analysis and the diversity of responses." He hopes, though, that the fund would be implemented as soon as possible, with full transparency and accessible to all actors. More than 500,000 people remain internally displaced and about 388,000 have fled to neighboring countries, which the fund also aims to help. "The humanitarian situation remains dire, but the root causes driving the crisis will require investment in social services," Asin argued. Read more development aid news online, and subscribe to The Development Newswire to receive top international development headlines from the world’s leading donors, news sources and opinion leaders — emailed to you FREE every business day.