DEVELOPMENT: EU to Increase Aid

DEVELOPMENT: EU to Increase Aid
By Stefania Bianchi

BRUSSELS, May 24 (IPS) - European Union development ministers agreed Tuesday to raise the level of the bloc's aid spending by 20 billion euros (25.3 billion dollars) by 2010.

In a landmark decision, European Union (EU) foreign and development ministers meeting Tuesday (May 24) approved proposals by the European Commission, the EU executive, on how the bloc can meet a pledge of 0.7 percent of gross national income (GNI) in official development aid (ODA) by 2015.

Under the plans drafted by Louis Michel, EU Commissioner for development and humanitarian aid, the EU's 15 older - and richer - member states will make up the bulk of the effort to reach the objective with a commitment to spend at least 0.51 percent of GNI on aid by 2010 and at least 0.7 percent by 2015.

The bloc's 10 newest member states from mainly eastern Europe pledged they would strive to pay at least 0.17 percent by 2010 in order to reach a goal of 0.33 percent in 2015.

This would raise the joint average level of aid for all 25 EU member states from 0.33 percent of GNI to an average of 0.56 percent by 2010.

In real terms, such an increase in aid will mean 20 billion euros (25.3 billion dollars) more in aid for developing countries and will cost EU taxpayers in the 15 old member states only an additional 49 euros (61 dollars) a year.

Both goals are designed to revive the momentum towards achieving a United Nations target of spending 0.7 percent of national wealth on development by 2015, and are a part of a bid to achieve the Millennium Development Goals (MDGs) by the same year. Only four EU states - Denmark, Sweden, the Netherlands and Luxembourg - have so far fulfilled a promise made in 1970 by the world's rich countries to reach the 0.7 percent figure.

Britain, France, Finland, Ireland, Belgium and Spain have fixed timetables to reach the 0.7 percent target before 2015, but other countries such as Italy and Austria are falling short of their longstanding commitments to fight poverty.

Belgium and Finland are committed to reaching the target by 2010, France and Spain by 2012, and Britain by 2013.

Announcing the decision Tuesday, Luxembourg development minister Jean-Louis Schiltz, whose country currently holds the EU presidency, said the decision marked the "biggest commitment" of aid since the MDGs were agreed in 2000.

"I consider this to be an essential development, an extremely important advance in international solidarity. Europe has shown today that international solidarity is not an empty phrase," he told media representatives.

Michel added that the deal "positions the European Union as the veritable global leader in development policy ahead of the high level meeting in New York" and would pressure other rich donors such as Japan and the United States, who currently lag behind the EU's more generous member states, to do more.

"If we lead the way, if we show that we are committed and ambitious to this extent, then other international partners will be obliged, I think, to follow suit and mobilise additional resources," he said.

World leaders will gather in September to discuss the slow rate of progress towards the MDGs, which include halving the world's most abject poverty by 2015.

Whilst signing the deal, Germany, Italy and Portugal stressed in separate statements that they are facing financial problems trying to keep their budgets within EU deficit limits, and highlighting EU rules that limit members' ability to borrow.

But Schiltz denied that these declarations could be seen as an escape clause.

"Some member states have expressed difficulties...but the main thing is that despite those difficulties, those countries have committed themselves," he said.

The 'Global Call to Action against Poverty' (GCAP), a worldwide alliance of non-governmental organisations (NGOs) committed to making a breakthrough on poverty in 2005, welcomed the agreement and said the new accord could have a "persuasive effect" on the United States, Japan and Canada to honour commitments they have already made..

"With only weeks to go to the G7 finance ministers meeting in London and the G8 meeting in Scotland, it clearly lays down the gauntlet to the U.S., Japan and Canada," the group said in a statement shortly after the announcement.

However the alliance insisted that EU can still go further, and urged finance ministers to strengthen the pledge at a meeting due June 7.

"We want them to strengthen today's deal and show even more ambition to make poverty history. GCAP is specifically calling for EU member states to honour their commitments to reach the 0.7 percent target and agree binding timetables to actually meeting this objective," the group added. The aid targets are part of an overall package aimed at boosting the EU's aid to developing countries and they are expected to be endorsed by the bloc's leaders at the summit in June. (END/2005)

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