Development aid contributes to economic success in both developing countries and in Europe, Development Commissioner Andris Piebalgs tells in an exclusive interview.
You just made a speech at a conference on food and nutrition, one day after the Commission presented the new EU policy to improve nutrition across the world. It appears that it’s not only about feeding the hungry; it’s also the quality of food that matters. But this is a problem not only for the poorest countries, but also for richer countries…
Yes, I think for some time it was seen as if it there were enough calories, you could guarantee a decent life for anyone. And that was the main focus for us to provide people with enough food.
But in recent studies we have seen the influence of nutrition in particular early ages which has an impact on the rest of people's life. If you look at South Africa as an example, you can see it as an upper-middle income country but still struggling with challenges from the past, with some black communities severely affected on the employment front, for instance.
Also they invest in education but on some parts of the country and for some part the population results on access to education are worse compared to some parts of Zimbabwe, for example. And one of the problems behind this is the lack of sufficient nutrition for some pregnant mother and children. And the South African government now recognises this is actually a priority they need to address and deal with it; because if you do focus on the issue of nutrition you are facing the impossible task of improving the life of each and every citizen.
But you recognise that nutrition problems exist even on the European continent; I’m thinking of countries covered by the EU’s Eastern Partnership and maybe some candidate countries?
Yes, within the EU there are people affected by nutrition. But if I see the EU as a whole it’s not at problem of the scale that you could compare with the poorest countries because in Europe we have very sound healthcare systems starting from early pregnancy until children [are] going to school and children are accompanied through their growth. That is why I would say that in Europe I don’t see nutrition as major a challenge than in least developed countries.
In times of austerity when it’s not easy to sell to the European public the idea that a lot has to be done to help developing country, what is your communication strategy? On EU enlargement, we are told that older members also benefit from enlargement, that western companies profit from activities in the new member states in the East. But we don’t hear that so much when it comes to development aid?
The main focus of the European Commission supports towards the neighbourhood countries and Africa. These are territories closer to the European Union. And I agree that we do not make enough the case that development aid is also contributing to economic development in both development countries and in Europe.
Africa has approximately 5% growth a year, so it’s a growing market for our goods and services. If things in Africa continue on a positive trend, this is an enormous opportunity for European employment and growth.
If things go like in Syria with conflicts, this will only increase the costs, for instance in humanitarian aid. The EU has already invested humanitarian aid to Syria of up to €400 million; the reconstruction of Syria will cost a lot more than that. So it’s very clear that non- action on the development side to fight poverty and support stability actually means more costs at a later stage.
You can therefore explain the issues related to development not only with moral arguments. Moral arguments, the defence of values and the heart should be part of it. But also the mind, by explaining that investments towards developing countries create benefits also within the European Union and decrease the cost for some actions that we have to do later to manage crisis.
A research done on the commission proposal budget for next seven years for development aid has estimated that EU aid would create 0.1% of GDP for the European Union. If I extrapolate and if the money is cleverly invested, EU aid could generate a growth potential for the European Union over the next seven years of 0.5% of its GDP.
It is not an argument often used. And that’s why I mentioned to you earlier the example of nutrition and the South African plans to improve it. If you look at their programmes you can clearly see that they also link the need to improve nutrition in relation to its impacts on education and employment. Because you can invest a lot in education and still not get results if you do not invest in nutrition – you can train teachers but the kids can’t cope with it if they do not have access to nutritious food. And if the kids can’t cope with it they can’t have access to employment in the future and if they can’t find the jobs, you have to pay for their unemployment benefits for them to survive. So the costs are enormous.
But the issue of how to improve nutrition is complex and needs to be integrated in overall countries efforts to promote their development. For instance, I was recently in Malawi where you almost don’t find any milk given to children. Milk is not such a bad product because of micro nutrition. But it is realistic to expect that there will be milk for every child at school in Malawi? Not really, because they don’t have enough cows to begin with. So tackling nutrition is linked to agriculture, how you diversify the production in order to improve people's access to nutritious food.
You don’t just bring pills and say take each day. It’s more complex than that. It requires a lot of change in countries’ structure. Particularly for poorer countries but also middle income countries, like Pakistan where it is also an issue.
The private sector in developing countries says that education is a problem because they need to find well trained and well educated people. How does the commission see the relation with the private sector?
We have some ideological discussion inside the Commission. I am of the opinion that someone's ability to find employment is very much decided very early when one is at preschool age and when one learn to read and write and do elementary math. And I would argue that for development partners anything else that providing everyone with the basic services should not be our main focus.
We have to focus on the basic. I never expect that I would be a commissioner when I was a kid and I would never expect to be I trained to be a commissioner, same for you as a journalist. It’s much more complicated and I could end up somewhere else. But you and I have managed first of all because we’ve had access to the basics such as food, education and health at early age without that no one can find have access to a decent life and find access to employment.
So in relation to your question on the role of private sector, I believe that if companies want to establish in a country they need to be in contact with the labour force. If you have a labour force that has basic skills it’s not so difficult to provide training. It takes some activities and you invest basically on the basis of assumptions that you have well prepared labour force. If there is no decent basis like is the case in some for the poorest countries, then it’s really difficult to expect that you will manage to find the labour force you need.
From the Ethiopian example, when I met investors, they confirmed me that the possibility to attract more investment in the country is clearly related to the improvement of the poorest people's access to nutrition and basic education. That’s another reason to say don’t neglect nutrition, health of children and pregnant mothers and basic education. I believe in the need for development aid to focus on providing access to basic services for everyone
The development committee in the European Parliament has estimated the difference between what the commission had envisioned as a budget and what has been agreed at the level of heads of state is a difference of €10 billion. Do you think this is correct?
Yes it is, unfortunately. It’s easy to calculate. We had asked for around €100 billion all together for external action and we got around €87 billion. Not all was foreseen as just for development aid. But they are right, over €10 billion was lost in discussions at the Council. To be honest towards heads of states, they put the 0.7% target [0.7% of gross national income for development aid by 2015] in their conclusions, so I will expect that they will increase their national budgets because they committed to do it.
Today [14 March], for instance, I met the Latvian prime minister [Valdis Dombrovskis]. And despite Latvia is going though challenging times, his government is building the development policy of Latvia. They plan this year to increase the budget to finance bilateral development aid. My only advice was to establish development cooperation on very stable legal basis, and to Use existing channels of delivery of aid channels that exist and work.
It is very encouraging news because Latvians can often be sceptical and development aid is the last that they would favour, some would say. But what also has helped in Latvia is that development issues through my current responsibilities have started to get some attention from some media organisations. And when they cover my official visits to countries sometimes the main shock for Latvian citizens is the lack of access to basic healthcare for people.
When they compare healthcare centres in African countries with the ones they have in Latvia, they understand it’s two different worlds we live in. And then the people start to see the world is unfair. So I believe that there is a possibility to bridge the gap – or at least to make it smaller.
People are much more open to the world if they are properly explained what the money is for and that money will reach the final destination. I think then the people are much more open and governments need to take much more leadership. Because there will not be demonstrations in Brussels with 10,000 people saying “give more money for the developing world”. It’s difficult to imagine it.
But European citizens say OK, it’s 1% of our budgets, if there is accountability and transparency, I am ready really to support it. And I think that’s the value of solidarity in Europe that bringing people together in Europe. They had these public opinion polls Eurobarometers we did who say that 85% of European citizens said yes that the EU should help the poorest people of the world.
The scale and modalities make a difference, but basically people are not negative about it, especially as it goes through transparent procedures that we use to deliver our development aid.