Who’s going to pay for the SDGs?

In July, Addis Ababa will host a crucial summit on financing for development. If September’s summit on sustainable development goals (SDGs) in New York is when governments will decide what they want to achieve on poverty and sustainability by 2030, Addis is where they must set out how they will do so.

There’s much to do, with a bewildering array of potential issues on the table – aid, trade, tax, the private sector, climate, sustainability and technology transfer are all possible focus areas – and too little clarity on what success would look like on each. Politicians are not yet feeling pressure to make serious offers.

Yet, if Addis disappoints, the fallout could be extensive. Prospects for achieving the SDGs – such as ending poverty by 2030 – would dim significantly. Frustration among developing countries could feed in to the September summit and the December climate summit, threatening a cascading failure that could damage prospects for international cooperation on defining global issues for a decade.

How can we avoid this scenario and ensure that Addis is a landmark?

First, there needs to be a clearer narrative on what the summit is for, that focuses on three or four core areas. At least one of these needs to be about politicalimpact, with a big story that leads the next day’s news agenda. In practice, this probably has to be about aid – even though it now accounts for only around a 10th of development finance.

Timetables for countries to give 0.7% of national income to aid are unlikely to work, given past promises: in 2005, 16 countries pledged to meet 0.7% by 2015, but only five have delivered. A pledge to give at least half of all aid to least developed countries, on the other hand, may cut more ice – but the politics look tough.

Other contenders could include a major push on addressing the “financing gap” faced by many middle-income countries, through scaling up official financing other than aid. And a strong focus on financing highly effective cash transfer schemes in lower income countries would go a long way towards ending poverty.

The Addis outcome could also help key “work in progress” agendas with longer term development impact.

One area where there’s plenty of buzz is the contribution the private sector can make – for instance, through scaling up foreign direct investment (the single biggest source of development finance), new public-private partnerships, or in key sectors like infrastructure. Less clear, though, is exactly how Addis may contribute.

Instead, a better candidate may be international tax cooperation – the most important thing that rich countries can do to help developing countries mobilise their own resources.

One step would be to spend more aid on developing countries’ tax administration efforts – an area with breathtaking rates of return. Faster progress on recovery of stolen assets from abroad is another priority for many developing countries, as is access to the automatic exchange of tax information that G8 and G20 countries have already agreed among themselves.

Above all, Addis could help close tax loopholes that allow multinational companies to report profits in tax havens – rather than where their workforces, assets or sales are. Country by country reporting requirements would be one important step; a unitary tax system would be even better.

Addis could put emerging issues on the development map by including these in the outcome document – even if the time is not yet ripe for agreeing concrete actions. It could put down a marker on the need to do more to tackle inequality, echoing the SDGs’ emphasis on the issue. Or, it could flag up the potential wins that would result from fair shares for developing countries in any future global emissions budget.

Most of all, Addis needs more agenda-setters to help its Norwegian and Guyananco-facilitators, and Ethiopian hosts, to champion its potential. UN secretary general Ban Ki-moon and World Bank president Jim Yong Kim could both do more. Germany and Turkey, hosts of this year’s G7 and G20 summits, could be key players too.

Addis needs more voices to make the moral case for why countries need to raise their game. Civil society has a crucial role here. And it may be that Pope Francis emerges as a leader, given his commitment to justice – and the fact that a papal encyclical on climate and development is expected soon.

Perhaps most of all, the summit will depend on commitments from finance ministers to attend (as IMF head Christine Lagarde has already done). They, far more than development ministers, have the power to unlock real progress.

Burkina Faso, Blaise Compaoré and the Secret of [Almost] Eternal Rule

My book The Ringtone and the Drum turned two last Sunday. Conveniently, one of the countries it covers, Burkina Faso, promptly had a revolution. Yesterday a great crowd of protesters set fire to parliament, invaded the state television studios, and may have succeeded in dislodging long-serving president Blaise Compaoré. It is still unclear who is in control in the country, with the army announcing the formation of a transitional government and the president inflaming the ire of the protesters and opposition parties by saying he will hang around to oversee it.

I wrote quite a lot about Compaoré and his ill-fated predecessor Thomas Sankara in the book (by this stage of my journey around West Africa I was too busy having a nervous breakdown to do much actual travel writing). Here’s an excerpt analysing how and why Compaoré and dictators like him cling to power for so long: Continue reading

Bruce Jackson: the man who took NATO east

Bruce-Jackson-DELFI-Photo-by-K.-ČachovskisThis is a piece I wrote 11 years ago for this crappy financial magazine I used to work for. The piece is good though. It’s about Bruce Jackson, an American spy-banker-arms-dealer-policy-wonk, who helped lobby for the eastern expansion of NATO in the 90s and Noughties. I thought I’d post it here considering this week’s NATO conference on further eastern expansion and Russia’s response. The piece was written in 2003, in the middle of the second war in Iraq.

IT WAS THE deal of the year in central and eastern Europe – not a sovereign Eurobond, a corporate high-yield issue or an IPO, but a transaction that emerged from the heart of the military-industry complex. It was the biggest debt financing of the year – a $5.5 billion off-balance-sheet deal arranged by JPMorgan and guaranteed by the US government. You haven’t read about it, because it was to finance Poland’s acquisition of 48 F-16 military aircraft from Lockheed Martin.

That deal was signed in March 2003. The same month it went through, Poland agreed to send about 3,000 troops to Iraq. Euromoney spoke to a banker involved in the syndication of the financing. “We understood what the deal was,” he said. “The US government finances the deal at good rates. In return, Poland supports the US in Iraq.”

Every other eastern European country that has either recently joined or is waiting to join the Nato military alliance also supports the US campaign in Iraq, leading US defense secretary Donald Rumsfeld to praise the birth of “new Europe” and French president Jacques Chirac to tell these countries to shut up.

Man of influence

The figure at the centre of all these events is someone you probably haven’t heard of, but who wields extraordinary political influence in the region – Bruce Jackson. He is a Washington neo-conservative, a member of the Project for the New American Century, and friend and colleague of other prominent neo-conservatives such as deputy defense secretary Paul Wolfowitz and Gary Schmitt, executive director of the Project for the New American Century.

A former investment banker, he’s also president of a private NGO called the US Committee on Nato, one of the most influential in eastern Europe. He has also headed a neo-conservative think-tank called the Committee for the Liberation of Iraq. And he’s a former vice-president at Lockheed. Is he the military-industrial complex conspiracy figure par excellence?

Jackson, through his work for the NGO, has done more that anyone else to get eastern European countries into Nato. First, he lobbied hard in Washington to get the Czech Republic, Hungary and Poland invited in 1999. He advised the heads of these states on how to reform their military forces and civil societies so as to get the invitation, and testified in their support to the US Senate committee on foreign affairs.

In the past two years, he has been equally active in getting most of the other eastern European countries invited to Nato. He has travelled relentlessly, meeting heads of state and foreign ministers in every eastern European country, advising them on how to reform, and helping, this year, Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovakia and Slovenia to get invitations to join Nato.

None of the accessions was by any means inevitable. It took vision, will and hard work. Jackson recalls: “When we started in 1995, around 70% of editorial boards and 80% of think-tanks were on the record as being opposed to Nato expansion. There was concern Russia would go ballistic if we did expand Nato east. So effectively people were suggesting we do another Yalta, and sacrifice the region to Russia’s interests. So it took us considerable amounts of work. We organized well over 1,000 meetings with senators and Congress. By 1999, we won 89% of the vote. With the second round, almost all the effort came from the countries themselves, trying to accelerate their own reforms and not be left out.”

The fact that in 1995 so many in the west were against Nato expansion makes it all the more remarkable that one man, apparently operating in a private capacity at an NGO he set up, should have had such an influence. As one diplomat in the region says: “All these countries getting into Nato – this was Bruce’s work. He’s a real player in this process.” Continue reading

The six fathers of ISIS

(As defined by Ziad Majed and abridged by Amir Ahmed Nasr in this excellent post):

ISIS is the offspring of more than one father, and the product of more than one longstanding and widespread sickness.
1. ISIS is first the child of despotism in the most heinous form that has plagued the region.
2. ISIS is second the progeny of the American invasion of Iraq in 2003, both the way in which it was initially conducted and the catastrophic mismanagement that followed.
3. ISIS is third the son of Iranian aggressive regional policies that have worsened in recent years.
4. ISIS is fourth the child of some of the Salafist networks in the Gulf (in Saudi Arabia and other states).
5. ISIS is fifth the offspring of a profound crisis, deeply rooted in the thinking of some Islamist groups seeking to escape from their terrible failure to confront the challenges of the present toward a delusional model ostensibly taken from the seventh century, believing that they have found within its imaginary folds the answer to all contemporary or future questions.
6. ISIS is sixth the progeny of violence or of an environment that has been subjected to striking brutality.

Ahmad Nasr also adds the observation that:

With the exception of reason #2, all other factors are local and traceable to the region and its state of affairs – affairs that have yes, been influenced by the legacy of European colonialism, the dynamics of the  Cold War, but lately much more so by the behaviours of local authoritarian actors.

Environmentally friendly oil rigs? Well yes, Norway, but….

oil rig

Photo: Dave Taylor/www.oilrig-photos.com

We are big fans of Norway here at GD. And look – in a bid to make oil production more environmentally friendly, the Norwegian parliament is hoping to force offshore oil rigs to use electrical power rather than burn gas or diesel.  Hurrah, obviously –  what’s not to love about the Scandinaviafication of oil production.

The Norwegians aren’t alone either.  Environmentally friendly drilling (by oil workers in shiny lipstick, obviously), is a thing, it seems…

So yay and double yay.  Let’s make oil production all green and cuddly and maybe we can stop worrying about those millions of barrels that are rolling up out of the sea every day and burning…oh wait a minute….

No SDGs for you, North Korea! (updated)

Gird your loins: the zero draft of the UN Open Working Group on Sustainable Development Goals is out! While most post-2015ers will have raced ahead to see what Goals are included, they’ll have overlooked a small but significant detail in the preamble. As you’d expect in a document of this nature, the usual genuflections to countries in special circumstances are naturally observed:

We recognize that each country faces specific challenges to achieve sustainable development, and we underscore the special challenges facing the most vulnerable countries and, in particular, African countries, least developed countries, landlocked developing countries and small island developing States …

But there are also a couple of additions to the usual list, lest anyone feel left out:

…as well as the specific challenges facing the middle-income countries. Countries in situations of conflict also need special attention.

Now, you might think that this diverse array of country categories must cover just about every developing country on Earth. But you’d be wrong. For as the proper development nerds among you will immediately have realised, there is a small number of developing countries that are neither least developed (according to the UNCTAD definition), nor middle income (according to the World Bank list) – Kenya, DPRK, the Kyrgyz Republic, Tajikistan, Tanzania, and Zimbabwe, to be specific.

In practice, Kenya, Tanzania, and Zimbabwe are covered elsewhere on the list, given that African countries warrant a special mention of their own. Kyrgyzstan and Tajikistan? Both landlocked – so they’re included too. Which means that, uniquely among the diverse array of the world’s developing countries, only North Korea fails to warrant inclusion in a category for special attention under the SDGs. Oops. Someone call Dennis Rodman!

Update: Peter Chowla writes in to point out that all is not lost for DPRK’s SDG coverage, as it is “most definitely a country in a conflict situation”: for one thing it never signed a formal peace treaty with the US after the Korean War, and for another thing it declared war on South Korea last year. So there we are: panic over!

Patching Up Nigeria’s North-South Divide

In the post-colonial period, African politics has tended to look something like this (as excerpted from my book on West Africa, The Ringtone and the Drum):

The French anthropologist Emmanuel Terray, drawing on his experience in the Ivory Coast, identified two distinct but parallel systems of government in Africa. The first is the world of the air-conditioner. This system, which is inspired by the Western style of government, gives off an impression of bureaucratic and technocratic efficiency. It is a world of presidents, constitutions, parliaments and laws, and speaks the language of democracy, development and modernisation. It pertains to certain places and certain hours of the day, to ‘office hours (as long as one defines these relatively flexibly),’ to government buildings made of cement and steel and glass, to presidential palaces and airports with VIP lounges, to ‘glorious official soirées in illuminated gardens.’ While the air-conditioner hums in the background, the leader, in his three-piece suit and tie and speaking in fluent metropolitan French or the smooth American burr favoured by Charles Taylor, announces grand development plans to his spellbound foreign backers: hydroelectric dams, a new motorway, airports, universities – the appurtenances of a modern state. He promises elections free and fair, and looks businesslike, not awestruck, when he takes his seat at the United Nations.

But much of this is display. As Terray observed, the principal function of the world of the air-conditioner is not to govern, but ‘to show, particularly to the outside, that the country works, that it holds rank in the concert of nations’ (recall the Sierra Leone government’s gift to Haiti’s earthquake victims, and its explanation that the country needed to play its part as a member of the international community). The serious business takes place not here, but amid a second world, the world of the veranda. This is a world of palavers under baobab trees, of sharing what you have, of the impenetrable African night, of obligations – personal, not bureaucratic, obligations – to your ancestors and your community; a world, at its most extreme, of human sacrifices in sacred forests. For our leader’s real concern is not democracy, nor the provision of services to his nation, nor that nation’s prosperous future. His real concern is in meeting his obligations to his narrow band of supporters, in feeding them in the here and now so that they will sustain him in power. This second system acts as a brake on the pride and greed of the Big Men, who are allowed to enrich themselves only if part of the material and political booty they accrue is generously redistributed. Like Gulliver tied down by the Lilliputians, Terray noted, the Big Man is ‘far from being entirely the master of his choices.’ As long as he produces the goods, the little people will sing his praises, vote for him, pass on rumours and render him other services. But if he fails to deliver, and to keep delivering throughout his time in power, they will jump ship. It is a tit for tat relationship, which requires the leader to be permanently on his toes.

Some countries may have moved away from this model in recent years; a few may even have been blessed with leaders who attempt to govern for all their people. On the ground, however, this is how African governments continue to be perceived – their reputation for cronyism has yet to be shaken off.

And perception is important. In Nigeria, which has been no exception to the above rule, the perception of many people is that the informal system of rotation of the presidency between northerners and southerners that had prevailed since 1963 has been broken. It may or may not be a coincidence that the murderous activities of the northern terrorist group Boko Haram, which some influential figures believe pose an existential threat to the country, ratcheted up after the accession to the presidency of Goodluck Jonathan in 2010. Jonathan, a southerner, succeeded the northerner Umaru Yar’Adua when the latter died after just three years in office. The informal rotation had hitherto seen the eight-year tenure of a northerner followed by a roughly similar period in charge by a southerner, but Jonathan’s victory in the 2011 election meant that by the end of his term southerners would have been in power for thirteen of the previous sixteen years. That he plans to run for re-election in 2015 has exacerbated northerners’ concern.

Northern Nigeria already lags behind the south. All ten of the country’s poorest states are in the north, school attendance is lower, and infant, child and maternal mortality rates are all much higher than in southern states. With a northern president in power in a patrimonial polity, northerners at least had the hope that they would have their “turn to eat” every few years. Without that reassurance, even in the unlikely event that the gulf between north and south does not continue to widen, many northerners’ perception is that they have been cut loose, and that the ‘material and political booty’ accrued by presidents will now be the exclusive preserve of southerners.

There are a number of measures that must be taken to quell the growing anger of the north, but in a country that threatens, as Foreign Policy magazine has recently put it, to ‘come apart at the seams’, political representation is among the most important. While it waits for leaders that govern for the many rather than the few, or for institutions that force them to do so, formalising the regular geographical rotation of presidents by enshrining it in the Constitution (thereby obliging the major parties to abide by it in putting forward candidates) may help narrow Nigeria’s north-south divide. In an ideal world this would not be necessary – leaders would take into account the interests of all their countrymen and distribute resources equally. But Nigeria is not an ideal world. The north-south divide has been accentuated by the long rule of southern presidents, and has helped bring about the emergency the country is facing. Formalising the rotation of the presidency is only a patch on a wound, but it may be a necessary one for northerners again to feel that they have a future as Nigerians.