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26/09/2016

German development aid hits record high in draft budget

Development Policy

German development aid hits record high in draft budget

Finance Minister Schäuble's draft 2016 budget plans a hefty increase in German development aid.

[Deutscher Bundestag / Thomas Tritschel / photothek.net]

Berlin’s draft budget is on its way, with plans for a massive increase in development aid. Still, critics fear the numbers could be distorted, and warn against the improper allocation of resources. EurActiv Germany reports.

The federal government approved the largest increase and the highest development aid budget in the history of the Federal Republic on Wednesday (18 March).

The 2016 budget plans to increase allocations for development aid to €7.4 billion.

“In this way, we are underlining our development policy responsibility, particularly in light of the ongoing humanitarian crises and growing challenges in the area of international climate protection financing,” said German Finance Minister Wolfgang Schäuble on Wednesday, presenting key points of the draft budget.

German ministries would have around €1.3 billion more at their disposal to provide aid in poor countries throughout the coming year. The Development Ministry (BMZ) would receive an additional €860 million, the Foreign Office €370 million and another €50 million would go to the Environment Ministry.

By 2019, development aid is planned to receive more than €8.3 billion in total additional funding.

Schäuble cited the “increasingly difficult international environment” as the reason for boosting spending. The German government is confronted with growing “imponderables and uncertainties”, a ministry spokesman said.

>>Read: Schäuble criticised for ‘cosmetic’ increase in development funds

Development Minister Gerd Müller wants to use the majority of the additional funding for the refugee crises in the Middle East and Africa.

The Development Ministry plans to take measures to prevent refugees from leaving their homes and help integrate them in their countries of origin, he explained. To do this, Müller indicated plans to implement an infrastructure programme for these regions.

The centre-right politician also wants to support projects combating world hunger and aimed at protecting the climate and natural resources.

0.7% ODA target still far off

As a part of the Millennium Development Goals (MDGs) announced in 2000, the international community pledged to increase its ODA expenditures to 0.7% of gross national income (GNI) by 2015.

After national elections in 2013, the German government also indicated continued commitment to the goal in its coalition agreement.

But even with the latest budget increase, Germany is far from reaching the 0.7% target. Calculations by development campaigner ONE expect the current ODA rate of 0.38% – compared to 0.72% in the UK – to rise to 0.4% in 2016. By 2019, ODA could increase to 0.46%.

“We will fix ODA at 0.4%,” Schäuble confirmed.

Still, the Social Democratic Party’s development expert in the Bundestag, Sascha Raabe, welcomed the “unusual and drastic” step.

“It is a good day for all those who have, for years, been pushing for more resources for the poorest people in this world,” Raabe said.

The German Foundation for World Population also praised the boost in funding, while pointing out additional room for improvement. “The funds are not enough to reach the 0.7% target,” the foundation’s managing director Renate Bähr reminded.

“Focus on women”

ONE also prompted the German government to focus on the fight against extreme poverty in its latest budget increase. 50% of funds should be allocated to Least Developed Countries (LDCs), the NGO said, referring to the 48 poorest countries in the world.

“To this day, many top receivers of German development aid continue to be G20 countries and newly industrialised countries,” explained Andreas Hübers, a political advisor at ONE.

“If we hope to eradicate extreme poverty by 2030, we can only achieve this if we better utilise the potential of women. After all, they are the ones most affected by extreme poverty,” Hübers continued.

ONE and the German Foundation for World Population are demanding a concrete step-by-step plan from the German government. The latter must clearly specify when and with which resources it hopes to reach the 0.7% target, the organisations argue.

Climate versus development?

Meanwhile Germany’s Greens warns against premature excitement. “The devil is in the details,” warned Uwe Kekeritz, development spokesman for the Greens’ Bundestag faction. “We fear that the funds for climate protection and development will be played off against each other – at the expense of long-term development goals.”

Müller has been counting each euro twice, Kekeritz said, once for climate projects and at the same time for development projects. “More transparency is needed here and, most importantly, additionality,” he contended.

Speaking with EurActiv Germany, Kekeritz also argued for more targeted use of financial resources.

“The development ministry keeps churning out more and more projects, many of which are hardly useful,” the Greens politician said. “We need structural changes in our development cooperation.”

Background

In 2005, member states pledged to increase Official Development Assistance (ODA) to 0.7% of Gross National Income (GNI) by 2015 and included an interim target of 0.56% ODA/GNI by 2010.

These were based on individual targets of 0.7% ODA/GNI for the EU 15 and 0.33% GNI for the 12 member states which joined the EU in 2004 and 2007, according to the European Commission.

Countries that were already at or above 0.7% ODA/ GNI pledged to sustain their efforts. Heads of state and government reaffirmed their commitment to reach the 0.7% target by 2015 at the European Council on 7/8 February 2013.

A Eurobarometer survey from October 2012, said that 85% of polled EU citizens believed that Europe should continue donating aid to developing countries.

Further Reading