With nationalism on the rise, are aid donors becoming more selfish?

WASHINGTON — On Wednesday Tim Burchett, a Republican in the U.S. House of Representatives, suggested to Secretary of State Mike Pompeo that the administration might consider using foreign aid as a stick, instead of a carrot. “Will the U.S. be leveraging American foreign aid to encourage countries to stand with us at the U.N. as has been suggested?” Burchett asked Pompeo, who was on Capitol Hill to defend the administration’s third straight proposal to enact deep cuts in international affairs spending. “We talk about the carrot or the stick. It seems like we're always giving them the carrot, and the stick might be in order at some point," Burchett observed. Pompeo did not disagree. In fact, he suggested that the Trump administration has used the threat of withholding foreign aid to convince other countries to support its diplomatic positions. "We’ve certainly done that in terms of using all the tools at our disposal to make [our case] to partners on the Security Council, not only the permanent members, but those who are there for a shorter time, as well as folks in the broader U.N. general assembly that they would support us and vote with us,” Pompeo said. “Development doesn’t run in the same timeframe as the political cycle does.” --— Nilima Gulrajani, author of the Overseas Development Institute’s principled aid index The exchange highlighted a key tension for global development donors, one that has come into stark relief as more governments appeal to populist messages and inward-looking priorities. While all donor governments presumably believe development assistance serves their national interests to some degree, some donors want to see aid more closely linked to their own economic and political ambitions. And when it comes to what they expect to get in return, not all aid donors are created equal. Some governments, even while spending billions on development programs abroad, are more self-interested in their expenditures, while others tend to take a more principled approach, according to a new study by the Overseas Development Institute. This week the British think tank released its first-ever principled aid index, which ranks donors according to whether their aid spending supports a principled approach to development, or prioritizes their own narrowly-defined national interests. Among the 29 members of the Organization for Economic Cooperation and Development’s Development Assistance Committee, the researchers found that Luxembourg, the United Kingdom, and Sweden offer the most principled approaches to aid spending. The U.S. ranks ninth, Germany 16th, and the Slovak Republic is the least principled of the group. Notably, since the study was limited to DAC members, it does not include some major emerging development actors such as Turkey, China, and Middle Eastern states that are occupying larger — and in some cases, overtly geopolitical — places in the development funding picture. The report’s authors raised concerns that while donors overall grew more principled between 2013-2017, on one measure of principled aid — which they termed “public spiritedness” — some major donors are moving in the wrong direction. Public-spirited donors avoid “instrumentalizing” aid by minimizing the amount of tied aid they deliver, delinking aid from U.N. voting, delinking assistance from arms exports, and localizing their spending as country programmable assistance. The U.S. saw its public-spiritedness ranking fall by eight places from 2013 to 2017, landing at 20th. “The decline in this principle [public spiritedness] suggests that many donors are adopting a more short-sighted approach to aid, targeting it to help domestic constituencies and firms and supporting short-term foreign policy objectives, rather than taking a longer-term, principled approach,” wrote authors Nilima Gulrajani and Rachael Calleja, in the report. If global development outcomes are in every country’s interest, then over the long-term a principled approach to development assistance is what will realize those goals. The report’s authors don’t suggest that donor countries should ignore their own interests, but that they should “advance their national interest by pursuing a principled aid allocation strategy.” The problem is that governments don’t always take that long view. “One of the challenges is the timelines. Development doesn’t run in the same timeframe as the political cycle does,” Gulrajani told Devex. Politicians, she added, “want a clear sense of that domestic return.” Gulrajani said that she hopes the ranking might help start a conversation about the differences between principled and self-interested aid expenditures, and she hopes donors might hold each other accountable for delivering assistance that puts development outcomes first. “We need a new normative consensus around this,” she said, adding that the entrance of “nonconventional donors” into the funding landscape might offer an opportunity to set higher expectations. Adva Saldinger contributed reporting to this story.