Robert Calderisi on Kenya, the role of foreign aid

Robert Calderisi

From Saturday's Globe and Mail

In the last few days, a number of outside voices have offered advice on the crisis in Kenya, Robert Calderisi wrote Saturday in his Globe essay High time to lose patience in Kenya

"We can't just sit by," said the chairman of the African Union, opening its annual meeting in Addis Ababa on Wednesday. "If Kenya burns, there will be nothing for tomorrow."

The president of Rwanda, Paul Kagame, favours a military coup d'état.

"It might not be fashionable," he says, "but in situations where institutions have lost control, I wouldn't mind such a solution."

Mr. Calderisi argues that Less draconian approaches may also work — but only if Kenya's problems are seen in a larger light.

"So how can the international community respond to Kenya's — and Africa's — impatience for progress?" he asks.

"It can seize the assets of senior officials who, until now, have salted away their loot in Western banks with total impunity.

"The world can continue to provide direct support to community groups, human rights activists, democratic reformers, and those promoting a free press.

"And, in a number of cases, the answer may be to make foreign assistance more openly political . . .

"Making aid more political does not mean using it as a convenient instrument of foreign policy. But if the goal is to fight poverty, the way a government treats its citizens — including its journalists, entrepreneurs and small farmers — should be central to the level of aid it receives."

Whether you agree or not, it's a provocative thesis, so we're glad that Mr. Calderisi was online to answer your questions on his essay, on his arguments and on the situation in Kenya.

Your questions and Mr. Calderisi's answers appear at the bottom of this page.

Mr. Calderisi has worked on Africa since 1975, mostly at the World Bank, where he held a variety of senior positions including Chief of the Bank's Regional Mission in Western Africa based in the Ivory Coast (1991-94).

He also served as the Bank's international spokesman on Africa (1997-2000) and Country Director for Central Africa (2000-2002).

He is the author of The Trouble with Africa

Editor's Note: globeandmail.com editors will read and allow or reject each question/comment. Comments/questions may be edited for length or clarity. HTML is not allowed. We will not publish questions/comments that include personal attacks on participants in these discussions, that make false or unsubstantiated allegations, that purport to quote people or reports where the purported quote or fact cannot be easily verified, or questions/comments that include vulgar language or libellous statements. Preference will be given to readers who submit questions/comments using their full name and home town, rather than a pseudonym.

Estanislao (Stan) Oziewicz, Foreign Editor, globeandmail.com: Robert, thank you for being with us today as troubling events continue to unfold in Kenya. Some of our readers are eager to challenge your ideas, so let's start.

Terry Maurice, from Guelph, Ontario: The World Bank has an atrocious record with respect to how it delivers 'world aid.' Draconian economic measures are put in place, ostensibly to 'open markets' but in reality are aimed at gaining control of the economy, banking, and privatizing essential services such as water and then forcing cutbacks on social services to pay interest on the World Bank debt. Read Michel Chossodovsky's 'The Globalization of Poverty' and John Perkins' 'Confessions of an Economic Hit Man' if you want to find out how almost every major conflict in the Third World goes back to the measures implemented by the World Bank and the International Monetary Fund. It is a disgusting display of greed by wealthy nations, especially the United States, to gain control of the third world's resources, labour and money supply. Your comments please.

Mr. Calderisi: The World Bank certainly has a bad reputation in progressive circles but if you asked the approximately 50,000 professionals who work within the United Nations system or for national foreign aid agencies (like Canda's CIDA), the response would be much more positive, or at least more mixed. Not about the quality of all its decisions or the successes of all its projects, because people in the field know how hard it is to translate good intentions into concrete results on the ground. But most of them would probably acknowledge that the Bank has the best talent and the greatest resources to do the kinds of things every aid worker wants to accomplish. It also has no foreign policy or trade interests to protect, like most countries that give aid. And it has a big "bully pulpit" from which it can try to affect international perceptions and policy on sensitive issues like industrialized countries' trade policies, especially in agriculture, that limit the opportunities for poor countries to literally grow their way out of poverty. The Bank under Jim Wolfensohn (1995-2005) was as energetic about promoting common sense on this subject, as well as corruption and debt relief, as his predecessor Robert McNamara (1968-1981) was in arguing that aid was a fraction of the amount the West spent on weapons.

Over the years, the World Bank has had many arguments with the International Monetary Fund -- usually, but not always, behind closed doors -- on how best to serve the interests of developing countries. The issues are sometimes complex and the debates are worthwhile. One last point: The World Bank has not really added to the debt burden of the poorest countries recently. Since 1985, all of its lending for Africa has come from a special fund -- topped up by about 30 countries in the world, including Canada -- that offers interest-free loans over 40 years. By the time these credits are repaid, 80 per cent will have been a grant.

The debate about the respective roles of markets and governments in creating wealth and distributing it fairly remains lively, and the Bank and the IMF are good targets for the frustrations of those who think that globalization always hurts the poor or that rich countries can always dominate poorer ones. But these institutions are only reflecting the views of their member governments, all of whom are represented on their Boards. China and India, for example, have their own seats there. Partly because the Bank and IMF are the creations of governments, they believe in the importance of public policy, globally and nationally, in helping the poor. If they were simply serving the corporate interests of the West, I assure you that they would be shut down. Some right-wing thinkers see the Bank as interfering with the "free play" of market forces.

Finally, those education and health services were not cut back because of World Bank advice. Africa lost half its shares of world markets in the 1970s and 1980s to other developing countries. That represented a $70 billion loss of income every year. The Bank had only $3 billion a year to help countries deal with the consequences.

Nimmi Thind, from London, Ontario: As a social worker who has worked in the slums of Bombay, I believe the only word that comes to mind is 'accountability' in every ministry of the government. Restoring peace is the first step, and the Western world should realize that the concept of a country having boundaries is difficult where the people's first allegiance is to their tribe. Reforms can take place only when people have food to eat and jobs. Education and health at the grassroots level is extremely important. Democracy cannot be established on an empty stomach. People should be made self reliant. Do you agree?

Mr. Calderisi: I agree wholeheartedly. At a conference in South Africa, I heard Nelson Mandela say the same thing about "democracy on an empty stomach" and no one can question his democratic credentials. In fact, rudimentary forms of accountability are being introduced wherever possible. For example, in Uganda people in the rural areas have insisted that the list of materials delivered for improving a clinic or school be posted on the front door of the establishment, down to the number and weight of the bags of cement, so that everyone can track their use. This has cut down on the amount of public resources "lost" to other purposes. Africans across the continent are fighting hard for greater public accountability and we must not discourage them by bailing out bad governments, or spreading our aid so widely that it waters the weeds as well as the flowers.

A. Kim, from Canada: What role can the African Union play in stabilizing the current political conflict in Kenya?

Mr. Calderisi: Unfortunately, the African Union does not always have the moral, let alone military weight to intervene effectively. The Chairman of the AU (the President of Ghana) visited within days of the outbreak of violence but left empty-handed. In parts of the continent, like Sudan and Somalia, the AU depends heavily on financial or logistical support from Western countries, and this takes time.

Trixie Belden, from Canada: Guess what? The money flowing out of Canada (and the United States and the United Kingdom) already is politicized. It has been for a long time. The question is: Do Canadians understand that and what to they want to do about it?

Even though informal financial flows outstrip Official Development Assistance (ODA), a majority of Canadians still think of aid as government-to-government transfers. The World Bank estimates that in 2005 global remittances exceeded $200 billion (U.S.). Together with ODA, the total amount of money as a percentage of our GNP that moves to developing countries is much higher than the touted 0.7-per-cent development assistance benchmark used to rank OECD (Organization for Economic Co-operation and Development) countries. That total is also greater than the aid budgets of the Scandinavian countries that typically hold first rank in foreign aid measurements, but which also lack the demographic diversity that makes diaspora remittances possible.

Perhaps it's time we had a better understanding of how private financing fuels both conflict and peace building in developing countries. A majority of Canadians believe that Canada has a moral obligation to help the poorest of the poor. However, that claim to universality is challenged by a belief that Canada should focus on fewer countries, while tying our carrots to basic performance measures. Such choices come with trade-offs. Focusing our aid on fewer countries means having a better sense of how our aid is used. A Senate Committee report on the mission to Afghanistan recommended that CIDA hand over $25 million to the military apparently because our forces are better positioned to deliver aid. Another Senate report challenged CIDA to make good on its efforts to help stabilize sub-Saharan Africa, arguing that our aid is spread too thinly without demonstrable results. The Manley report also recommended better targeting in Afghanistan. What do you have to say?

Mr. Calderisi: I agree that private flows are more important than public ones, and that has probably always been true. They are also more likely to reach poor people. The volume of remittances, i.e,., money outside Africa, Latin America and Asia that people send home, mostly to their relatives, now exceeds $300 billion. This is three times the total aid the rich countries provide. This does not include all the private charities that are active in Africa. Their work is not always efficient, but they make a great difference to individual peoples' lives and, just as important, boost their morale and express values of international solidarity much better than the mega-million projects people hear about on the radio.

Fanya Kazi, from Toronto: While we all share the concerns on the current crisis facing Kenya right now, it is very unfortunate that you have chosen to take advantage of this situation to make his case that aid to Africa needs to be tied to unspecified political agendas. Your choice of Kenya to pursue this argument actually undermines it because first, as you have noted, Kenya for the last couple of years has not needed foreign aid to finance its budget and, secondly, Kenya has pursued and implemented the major reforms he considers necessary as conditions for receiving aid.

Kenya has been able to do this largely due to the major reforms by the Kenya Revenue Authority. The tax collection has dramatically improved since President Kibaki's government came to power. The government was able to achieve an astounding increase in tax revenue by stopping tax fraud and corruption. As well, due to major economic reforms implemented by Mr. Kibaki's government, Kenya had a strong growth rate above 7.0 per cent before the elections in December 2007, up from 0.6 per cent growth in 2001. This was the highest growth rate experienced in Kenya for more than 30 years.

Furthermore, last year Kenya won the United Nations Public Service Award for improving transparency, accountability, and responsiveness in the public service. Also in 2007, Kenya received an international award, for reforms that have made it easier to do business in the country, from the International Finance Corporation, an arm of the World Bank. Therefore, Kenya has been able to achieve major reforms and progress without having political conditions to any foreign aid it receives. Attaching political agendas to this aid, which mostly goes to assisting in the fight against AIDs, TB and malaria, is not only uncalled for but also immoral.

Mr. Calderisi: Many countries have made progress in introducing clearer rules and greater public accountability, sometimes -- but not always -- because of outside pressure. It is important to give credit where credit is due. But one of the people who knows the most about Kenya's remaining shortcomings is the former anti-corruption chief, John Githongo. I doubt that he has much confidence in the degree of change so far, as he is in self-imposed exile in the United Kingdom, following threats to his life after submitting a report on internal corruption to President Kibaki last year. Two of the three ministers he charged with gross thievery of public resources are now back in the Cabinet.

Doomsday Machine, from Canada: Two things come to mind in implementing these kinds of strategies. First, the single biggest impediments in pursuing a politicized and targeted aid policy are at home. In particular, there is pressure from those who cling to the artificial 0.7 per cent mantra and who fail to take into account the flow of remittances that generate income for peoples back home and that often contribute to conflict there. The money flowing out of Canada now easily exceeds that 0.7 per cent mark when remittances are included, but it is not targeted and often undermines are efforts abroad (Sri Lanka, for example). A second domestic pressure comes from those who see aid's primarily goal as poverty reduction and one that should be applied everywhere without consequence. Moreover, if targeted aid is a primary objective, then donors will need a better set of evaluative tools for evidenced-based decision making. They need to know if they are having the impact intended and if they are generating unintended consequences through their actions.

Mr. Calderisi: I doubt that most remittances fuel conflict (although Sri Lanka and, some years ago, Irish-American contributions to the IRA, are certainly cases of that). As for public opinion in the West, there is virtual unanimity that aid should be to reduce poverty, including fighting disease. What other reason could there be -- that public opinion would support, or that would constitute good foreign policy? As for basing ourselves on objective evidence, 40 years of data from the major aid organizations' own evaluation departments indicate that aid only works only with governments that share the aid givers' values and have adopted good policies for their own reasons rather than to impress outsiders. Most other aid is wasted or even counterproductive -- by discouraging domestic reformers who are pressuring their governments to change.

Mr. Oziewicz, globeandmail.com Foreign Editor: Robert, I guess this debate will continue as long as we have foreign aid. As you can see, our readers have a deep interest in this subject as well as conflicting views. Do you have any final thoughts before I end this discussion?

Mr. Calderisi: Thank you for arranging this discussion. All I would add is that I agree with Fanya Kazi that there are moral issues involved here, that should inspire us -- but not drag us too far away from our common sense. I still believe in trying to improve the way we provide foreign aid. Doing anything less would be like giving up the search for a cure to cancer. But, as with cancer, sometimes tough medicine is required, and the people who have advocated that consistently to me are the young Africans I have talked to over 30 years.

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