Told you so... Relief monies for tsunami-stricken Asia are part of a bait-and-switch package(*): the "switch" being the impending escalation against Iran.
Open purses with strings attached
By Alan Boyd
SYDNEY - Stung by United Nations criticism and eclipsed by a global outpouring of private aid, the world's wealthiest nations on Thursday assembled a massive financial package for the 5 million victims of South Asia's tsunami.
Meeting with their Asian counterparts in Jakarta, leaders of the United States, Japan, Australia and Western Europe pledged US$3.7 billion in immediate help and reconstruction funds for 13 affected countries. And more is expected as development needs are assessed.
The biggest contributors were Australia and Germany, with pledges of $764 million and $674 million respectively. Canberra will split its aid between emergency relief and long-term development assistance, while Berlin's package will be spread over three to five years.
Washington earlier pledged $350 million, and has also committed 13,000 armed forces personnel and an armada of naval vessels and helicopters for emergency operations.
But suspicions linger over the motivations of the US and its allies, which were collectively labeled "stingy" by UN relief coordinator Jan Egeland last week because of their slow response to the tsunami calamity. Comments by US Secretary of State Colin Powell and Australian Prime Minister John Howard reinforced the notion that while humanitarianism undoubtedly has played a part in shaping relief policies, it probably comes second to the time-honored practice of peddling influence.
So extravagant have been some of the aid pledges that European Development Commissioner Louis Michel cautioned the Jakarta participants against making promises that might not be delivered. "We have to be careful and not participate in a beauty contest where we are competing to give higher figures," he said.
Even the recipients, who are mostly in no position to refuse the offered cash, privately acknowledged that foreign-policy objectives - in particular the alliance against terrorism - had helped to loosen the purse-strings.
Relief organizations have calculated that as much as 75% of foreign aid is directly tied to trade access or other economic and political strategies. Some comes with so many strings attached, including preferential tendering on contracts and the hiring of consultants, that only 30-40% of dollar value is ever realized.
US policy dictates that much foreign aid be spent on costly imported medicines, weapons, agricultural produce or manufactured goods. Some European nations have a similar approach.
In the US, it was counter-terrorism activities and military cooperation that consumed most offshore funding through the first term of President George W Bush, in a period when other foreign development assistance from Washington stagnated.
As a proportion of gross national product (GNP), the US was the lowest aid contributor among the industrialized nations in 2001-03, allocating only 0.12% of total income in this period. Although Washington paradoxically displaced Japan as the largest donor in dollar terms, this was primarily due to its terrorism response.
"Most of the United States' increase in 2001 was due to a $600 million disbursement to Pakistan for economic support in the September 11 aftermath," the Organization for Economic Cooperation and Development (OECD) noted in a study of foreign-aid commitments.
Bush has requested an increased foreign-aid budget in the current financial year, but mostly to cover security upgrades at embassies and other overseas missions. Untied aid will account for only 5% of combined military requests.
While the tsunami victims have to make do with $350 million worth of assistance from Washington, at least until the US comes up with a better offer, there is so much money swilling around in Iraq that $18 billion tailored for "reconstruction aid" is still unspent.
According to the US Agency for International Development (USAID), "US foreign assistance has always had the twofold purpose of furthering America's foreign-policy interests in expanding democracy and free markets while improving the lives of the citizens of the developing world."
However, the balance has shifted as conservatives, convinced that official development assistance (ODA) has little or no impact on improving livelihoods or opening new export markets, have seized the budgeting agenda in Washington.
Private donations abroad by Americans, including pledges to charities and churches and disbursements from corporate foundations, now are three times as large as the ODA contribution of $16 billion, and there is every indication this trend will continue.
Washington's contribution looks even more miserly when the ODA data are broken down. Most goes to loyal Middle East allies Israel and Egypt, with Indonesia the only significant recipient among the tsunami victims.
Not that most other countries are doing any better. The British-based relief agency Oxfam reported last month that the foreign-aid budgets of wealthy countries had been falling since the mid-1960s, and that at current spending levels it would take more than 50 years to make any impression on global poverty.
Last year only five of the 22 countries classed as industrialized - Norway, Denmark, the Netherlands, Luxembourg and Sweden - achieved the donor benchmark of allocating 0.7% of GNP to ODA. The benchmark was adopted at the Earth Summit in Rio de Janeiro in 1992 under the UN Agenda 21 program for eradicating poverty through development assistance. No other countries have even come close to meeting the target.
France managed 0.41% of GNP last year, the United Kingdom 0.34%, Germany 0.28%, Canada 0.26%, Spain 0.25% and Australia 0.25%. Japan, the only Asian participant, came in a lowly 19th with a paltry 0.2%, maintaining a reduced ODA commitment that dates back to 2001.
"With the added dollars, Thailand, Indonesia and the other tsunami-ravaged countries could have developed their own early-warning systems. They would have the means to provide speedier and greater relief and emergency services when disasters strike," said American analyst Earl Ofari Hutchinson, a longtime critic of foreign-aid policies. "The United States and other rich nations must be applauded for their outpouring of dollars for food, medical supplies and support teams for the tsunami-stricken countries. But it shouldn't take a tragedy, or the eyes of the world, for wealthy nations to do more to alleviate human suffering."
Tokyo may be able to make amends with a separate call for creditor nations to freeze the debt obligations of countries hit by the tsunami. The UK, France and Germany have agreed but several others - including Australia, a close economic partner - have refused, putting the initiative in doubt. Freezing up to $3 billion a year from debt payments would ease the reconstruction burden, which the UN expects to cost at least $14 billion, though other studies suggest it could be as high as $20 billion.
The proposal did not make the agenda in Jakarta, but it is due to come up for discussion at next week's meeting of creditors known as the Paris Club, which links the Group of Seven industrialized nations.
Alan Boyd, now based in Sydney, has reported on Asia for more than two decades.
atimes.com
(*) Message 20910298 |
